sage march 2014 investor presentation
TRANSCRIPT
Aug-Sept 2012
Path to
Production
March 2014TSX-V : SGX
Path to Production
Timmins, Ontario
Path to Production
Forward Looking Statements
1
Statements made in this presentation, other than those concerning historical information, should be
considered forward-looking statements which are subject to various risks and uncertainties. Such
forward-looking statements are made based on management’s belief as well as assumptions made by,
and information currently available to, management.
The Company’s actual results may differ materially from the results anticipated in such forward-looking
statements as a result of a variety of factors. Additional information concerning factors that could cause
actual results to materially differ from those in such forward-looking statements is contained in the
Company’s filings with the securities and regulatory authorities.
Note: All currencies are in Canadian dollars unless otherwise noted
Path to Production
2
Sage Gold plans are to develop production from their existing resources on the
Clavos and Lynx projects to generate cash flow.
CORPORATE STRUCTURE
CORPORATE VISION
Exchange Symbol: TSX.V – SGX
OTC – SGGDF (USA)
• Shares O/S: 123.9 million
• Shares F/D: 139.1 million
• Current price: $0.02
• 52 week high/low: $0.045/$0.01
• Market Cap: C$ 2.5 million
• Average Strike Price of Warrants/Options: $0.14
• Proceeds from Warrants/Options: $2.1 million
Path to Production
3
SAGE GOLD ADVANTAGE
Near term production
1. Clavos Au and Lynx Cu- Ag - Au project Potential to generate strong cash flow for the company
Sage has access to custom mills for both the Clavos and Lynx projects
Permits in place to re-open Clavos for dewatering and underground rehabilitation
2. Both Clavos and Lynx have 43-101 resources
3. Preliminary Economic Assessment on Clavos Project 71% Internal Rate of Return (pre-tax) and $23.2MM Net Present Value
47% Internal Rate of Return (after-tax) and $12.6MM Net Present Value
4. Blue Sky Potential – Clavos and Lynx Projects Open at depth and on multiple directions along strike
Management will focus on continuing to increase resources
5. Excellent Infrastructure - Clavos Established infrastructure with $46 million spent on underground development
Note: The PEA does not indicate the economic viability of the mineral resource and is preliminary in nature, includes inferred resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and that there is no certainty that the PEA will be realized. Mineral resources that are not mined reserves do not have demonstrated economic viability. A PEA is deemed to be reliable +/- 50% level.
Path to Production
4
TIMMINS GOLD CAMPS CLAVOS
PROJECT
Timmins, Ontario
Path to Production
5
CLAVOS PROJECT- HIGHLIGHTS
Located in the prolific Timmins Mining camp and close geographically (20kms) to
Goldcorp’s (TSX-G) high grade Hoyle Pond mine which has produced more than 2.4 M
ozs since 1985 and is still in operation
Existing infrastructure in place including underground ramp access to the 300m level,
underground levels developed every 25m, power to site, surface ventilation system,
water management system
Low initial Capex required for potential production,$14.1million (represents 100% of
Capex requirement)
Permits in place to re-open Clavos mine
Clavos is also located 10kms from the Brigus Gold mill in Stock Township.
Natural Gas pipeline on the Clavos Property – Potential Fuel and Power savings
Path to Production
6
NEAR TERM PRODUCTION PLANS
Q2-3 2014
Financing
Q4 2014 – Q1 2015
Dewater and Rehab mine
Initial Tonnage Extraction and Production
Q4- 2015 - Commercial Production
CLAVOS
PROJECT
Timmins, Ontario
Path to Production
7
GOLD PRICE US$ / Oz (Au) $1400/Oz $1500/Oz $1600/Oz
Base Case
Gold Production Oz/Au 145,448 145,448 145,448
Revenue Cdn$ million 203.6 218.2 232.7
Initial Capital Expenditures (100%) Cdn$ million 14.1 14.1 14.1
Sustaining Capital Cdn$ million 21.1 21.1 21.1
Total Capital Cdn$ million 35.1 35.1 35 .1
Operating Expense Cdn$ t/Ore 142.5 142.5 142.5
Net Smelter Return Cdn$ t/Ore 6.1 6.5 7.0
Cash flow (undiscounted) Cdn$ million 19.9 34.0 48.1
Pre Tax
Net Present Value (NPV) 8% Cdn$ million 13.5 23.2 33.0
Internal Rate Of Return (IRR) % 48% 71% 94%
After Tax
Net Present Value (NPV) 8% Cdn$ million 5.6 12.6 19.5
Internal Rate Of Return (IRR) % 27% 47% 67%
Life of Mine Year 7 7 7
Payback Period Year 2.25 2.00 1.75 Note - assumes an exchange rate of 1:1 of Cdn to US Dollar;
-tax rates are based on a blended rate between Sage and SAS
-excludes any financing costs
-contingency on capital expenditures of 30%
-CAPEX figures represents 100% of financing
The PEA does not indicate the economic viability of the mineral resource and is preliminary in
nature, includes inferred resources that are considered too speculative geologically to have
the economic considerations applied to them that would enable them to be categorized as
mineral reserves and that there is no certainty that the PEA will be realized. Mineral resources
that are not mined reserves do not have demonstrated economic viability.
Clavos
PEA
Economic
Model
Path to Production
8
WHAT MAKES CLAVOS UNIQUE
ENVIRONMENTAL PERMITTING
all permits in place to dewater and commence Tonnage extraction – 700 tpd
EXISTING SURFACE INFRASTRUCTURE
10 km truck haul road to Hwy 101 10 km from 27.6 kV overhead power line mine access roadways mobile shop, generator, compressor & cold storage
building office trailer dry facility settling & polishing ponds
replacement value $5.0m
Path to Production
9
CLAVOS EXISTING UNDERGROUND
2,923m of primary access
710m of secondary access
3,208m of lateral level development
+200,000 m of surface & underground diamond drilling
10 levels with detail geological mapping & channel
sampling
Replacement value $40.0m
FootwallHanging WallSedimentContact
Hanging WallFootwallContactSediment
2.5 km
Path to Production
10
Total Indicated 1,258,400 4.81 g/t 194,600
__________________________________________________________________________
Total Inferred 795,600 4.70 g/t 120,000
__________________________________________________________________________
Note: The 2012 resources are estimated at a cut-off grade of 2.75 g/t Au, high gold assays are cut to 60 g/t Au and an average long-term gold
price of US$1600 per ounce was used.
CLAVOS NI43-101 MINERAL RESOURCE Oct ‘12
Tonnes Grade Total OuncesCategory
Convert Resources To Reserves:
discrepancy in underground survey prevents assigning reserve
categories
re-survey to verify actual location for underground workings
stope definition drilling to provide data base for upgrading
resource categories
NOTE: subject to PFS
Path to Production
11
CLAVOS PEA REPORT 2013
Forecasted production rate 600 tpd Life of Mine 7 years Forecasted Full production 3rd year, 4th Qtr. Internal dilution in resource block estimate External dilution:
- cut & fill methods 10% at 0 gms/t- long hole methods 40% at 0 gms/t
Tonnage recovery:- cut & fill methods 95%- long hole methods 90%
Note: The PEA does not indicate the economic viability of the mineral resource and is preliminary in nature, includes inferred resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and that there is no certainty that the PEA will be realized. Mineral resources that are not mined reserves do not have demonstrated economic viability.
Path to Production
12
ONAMAN PROPERTY - LYNX PROJECT - ONTARIO
Lynx Cu Ag Au 9,096 acres
Mill
Path to Production
13
ONAMAN
Yellow = .5% Cu x 3 metres – Cut Off Red = 1% Cu x 3 metres
Lynx NI43-101 Resource
1.936 million tonnes, 1.44% Cu
39.6 g Ag/T, 0.58 g Au/T
Lynx NI43-101 Open Pit Resource 485,000
tonnes 2.1 % Cu, 45.3 g Ag/T, 0.70 g Au/T
at 1% Cu cut off
LYNX PROJECT
Beardmore, Ontario
Path to Production
14
LYNX PROJECT – Cu Ag Au
Located within the Onaman Property – Northern Ontario
VMS system – high grade Cu-Ag-Au 43-101 Resource
Numerous VMS targets on the Onaman Property – potential to host large VMS deposit
Open at depth and along strike – Existing compliant resource - only drilled to 250-300 metres
Open Pit component – potential to increase size to the north
Existing mill in Beardmore – 75 km to Lynx
Path to Production
15
Patrick J. MarsChairman and Director
Mr. Mars is an independent consultant specializing in mine financing and analysis with over 30 years of
experience in the investment industry. Mr. Mars has acted as Chairman, CEO, or Director for several public-
traded mining companies and is currently Director of Aura Minerals, Carpathian Gold, Selwyn Resources and
Yamana Gold.
Peter BojtosDirector
Mr. Bojtos is a professional engineer with extensive experience in mineral development and production. Since 1996
following a successful career as CEO of several companies, Mr. Bojtos serves on mining company boards as an
independent Director.
Gary RobertsonDirector
Mr. Robertson is a Certified Financial Planner. He has worked in the financial industry for the past twenty years, and
presently serves on the board of several private companies as well as on the board of six Canadian junior gold mining
companies.
Mr. Freeman has extensive experience in public markets, finance and compliance, this includes six years as Director of
Markets and Compliance at the OFEX Market (now ISDX). Mr. Freeman is Compliance Officer of Loeb Aron & Company
a London corporate finance firm, a Lay member of the Upper Tribunal (Tax & Chancery) and of the Probate Committee
of the ICAEW. Mr. Freeman is also a director of TSX-V quoted Cabo Drilling Inc., of AIM quoted Capital Lease Aviation
PLC and of Jenolan Ltd.
Joe BaylisDirector
Mr.Baylis brings over 23 years of domestic and international mining industry experience to the Company. Mr.Baylis
graduated with an LLB from the University of Western Ontario and is a member of the Law Society of Upper Canada.
Sandy ChimDirector
Mr. Chim is an international business executive. He is the President and CEO of Century Iron Mines Corporation (TSX-
FER), a director of Augyva Mining Resources Inc. (TSX.V-AUV) and non executive director of Prosperity Minerals Holdings
Limited. Mr.Chim resides in Kowloon, SAR, Hong Kong, PRC.
C. Nigel LeesPresident, CEO and Director
.
Mr. Lees is a founder and past director of TVX Gold Inc., a significant gold producer in North and South America,
which merged into Kinross Gold, listed on the TSX and the New York Stock Exchange. Mr. Lees has over 30 years
experience in the Canadian investment industry and is currently a Director of several publicly traded mining companies
including Yamana Gold.
BOARD OF DIRECTORS
Peter FreemanDirector
Path to Production
16
MANAGEMENT and CONSULTANTSManagement
William D. LoveVP and Business Development
Ron ReedChief Financial Officer
Michael SkutezkySecretary and Legal Counsel
Consultants
Bob RitchieMining Engineer
Mr. Peter Hubacheck is a consulting geologist and President of W. A. Hubacheck Consultants Ltd. He has over
35 years of experience as a project geologist, exploration manager and Qualified Person for the purposes of NI
43-101, with experience in the exploration for gold, silver, base metals, uranium and diamonds in Canada and the
USA. He holds a Mining Technologist (1974) diploma from the Haileybury School of Mines and Technology,
Haileybury, Ontario and a B.A.Sc. (Geol. Eng. 1977) degree from the South Dakota School of Mines and
Technology, Rapid City, South Dakota.
Mr. Ritchie is a Professional Engineer with over 40 years of experience in mine management and development,
feasibility studies and mine construction. He has worked with several mining companies including Goldcorp,
Noranda Mines and St. Andrew Goldfields. He was responsible for the construction of the Stock (now Brigus
Gold) Mill. Mr. Ritchie is a graduate of the Michigan Technological University with a Bachelor of Science in
Geology Engineering. He is also a Qualified Person (QP) as defined by NI43-101.
Peter HubacheckP.Geo, QP
C. Nigel LeesPresident, CEO and Director
Mr. Lees is a founder and past director of TVX Gold Inc., a significant gold producer in North and South America,
which merged into Kinross Gold, listed on the TSX and the New York Stock Exchange. Mr. Lees has over 30 years
experience in the Canadian investment industry and is currently a Director of several publicly traded mining companies
including Yamana Gold.
Mr. Love is a geologist who has been involved in mineral exploration in Canada and was part of the world class Hemlo
discovery team. He was also an institutional equity salesperson in London, England, for a Canadian brokerage firm.
Mr. Love has spent the last fifteen years as a venture capitalist and a corporate finance specialist in a variety of
resource and technology companies.
Mr. Reed is a CGA with an MBA ( Finance) from the NY Institute of Technology. He has more than 20 years of senior
experience in implementing financial business strategies and has been involved in more than 15 acquisition and
divesture transactions. Since 2009 he has been providing CFO services in the mining sector.
Mr. Skutezky was Assistant General Counsel of Royal Bank for 25 years focused on International Project financing
based in Montreal and Toronto, in addition to working in Eastern Europe with Canadian Law Firms. He has recently
formed his own professional corporation for the practice of law and is the principal of Rhodes Capital Corporation.
Path to Production
17
WHY INVEST IN SAGE GOLD
Near Term Potential Production Q4 -2015
Clavos Positive Preliminary Economic Assessment – low Capex/ Fast Payback
Lynx – Compliant Resource / Large Deposit Potential/ Open Pit tonnage
Clavos/ Lynx - potential to increase tonnage through further in-fill and exploration
drilling
Production Financing – Joint Ventures being pursued
Low market capitalization
SMALL AND PROFITABLE IS BEAUTIFUL
Path to Production
18
CONTACT INFORMATION
Sage Gold Inc. 365 Bay Street, Suite 500
Toronto, ON M5H 2V1
Tel.: 416 204-3170
Fax: 416 260-2243
Karen Levy