Updated Mines and Money Presentation
Released
Released
Announcement PDF
Advancing El Zorro
Chile’s Newest
Gold Project
Investor Presentation
August 2021
Disclaimer
This presentation and any accompanying verbal presentation (together the Presentation) are confidential and have been prepared by Tesoro Resources Limited (Tesoro or the Company) and approved by the Board of the Company. The information contained in the Presentation
(Information) is summary only and should be read in conjunction with any other documents provided to you by the Company. The Information is current as at 30 August 2021 and the Company does not undertake to provide any additional or update information, whether as a result of new
information, future events or results or otherwise. By receiving the Presentation, you acknowledge and represent to the Company that you have read, understood and accepted the terms of this disclaimer.
The Company has prepared the Presentation based on information available to it at the time of preparation. No representation or warranty, express or implied, is made as to the currency, accuracy, reliability, completeness or fairness of the information, opinions and conclusions contained in
this Presentation. Tesoro, or related bodies corporate, shareholders or affiliates, nor any of their respective officers, directors, employees, affiliates, agents or advisers (Agents) guarantee or make any representations or warranties, express or implied, as to or take responsibility for, the
currency, accuracy, reliability, completeness or fairness of the information, opinions and conclusions contained in this Presentation. Tesoro does not represent or warrant that this Presentation is complete or that it contains all material information about Tesoro or which a prospective investor
or purchaser may require in evaluating a possible investment in Tesoro or acquisition of shares. To the maximum extent permitted by law, Tesoro and its Agents expressly disclaim any and all liability, including, without limitation, any liability arising out of fault or negligence, for any loss
arising from the use of information contained in this Presentation, or otherwise arising in connection with it.
Any forward-looking statements in this Presentation, including projections, forecasts and estimates, are provided as a general guide only and should not be relied on as an indication or guarantee of future performance and involve known and unknown risks, uncertainties, assumptions,
contingencies and other important factors, many of which are outside the control of Tesoro and which are subject to change without notice and could cause the actual results, performance or achievements of Tesoro to be materially different from the future results, performance or
achievements expressed or implied by such statements. Past performance is not necessarily a guide to future performance and recipients of this Presentation are cautioned not to place undue reliance on such forward-looking statements.
The information contained in this Presentation is for information purposes only, does not constitute investment or financial product advice (nor taxation, accounting or legal advice) and is not intended to be used as the basis for making an investment decision. In providing this Presentation,
Tesoro has not considered the objectives, financial position or needs of any particular recipients. Before making an investment decision prospective investors should consider the appropriateness of the information in this Presentation having regard to their own objectives, financial situation
and needs, and seek legal, taxation and financial advice appropriate to their jurisdiction and circumstances.
This Presentation is not a prospectus, product disclosure statement or other offer document under Australian law or any other law (and will not be lodged with the Australian Securities and Investments Commission or any other foreign regulator) and is not, and does not constitute, an
invitation or offer of securities for subscription, purchase or sale in any jurisdiction. In particular, this Presentation does not constitute an invitation or offer of securities for subscription, purchase or sale in the United States or any other jurisdiction in which such an offer would be illegal. The
securities referred to in this Presentation have not been, and will not be, registered under the U.S. Securities Act of 1933 as amended or the securities laws of any state or other jurisdiction of the United States and may not be offered or sold, directly or indirectly in the United States. The
information in this Presentation is strictly confidential. It may not be disclosed, reproduced, disseminated, quoted or referred to, in whole or in part, without the express consent of Tesoro.
Competent Person’s Statements
The information in this Presentation that relates to Exploration Results is based on information compiled by Mr Zeffron Reeves (B App Sc (Hons) Applied Geology) MBA, MAIG). Mr Reeves is a member of the Australian Institute of Geoscientists and Managing Director and shareholder of the
Company. Mr Reeves has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves. Mr Reeves consents to the inclusion in this Presentation of the matters based on this information in the form and context in which it appears.
The information in this Presentation that relates to Geophysical Results is based on information compiled by Dr Jayson Meyers who is a Fellow of the Australian Institute of Geoscientists. Dr Meyers is a consultant to Tesoro Resources Limited and has sufficient experience which is relevant
to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr Meyers
does not hold any securities in the Company. The Company confirms it is not aware of any new information or data that materially affects the Geophysical Results included in the original announcement on 16 April 2021.
The information in this Presentation that relates to Mineral Resources is based on information compiled by Mr Daniel Saunders, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Saunders is a full-time employee of Cube Consulting Pty Ltd,
acting as independent consultants to Tesoro Resources Limited. Mr Saunders has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition
of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. The Company confirms that it is not aware of any new information or data that materially affects the Mineral Resource information included in the original announcement on 28 July 2021
and that all material assumptions and technical parameters underpinning the estimates continue to apply and have not materially changed. The Company confirms that the form and context in which the applicable Competent Persons’ findings are presented have not been materially modified
from the original announcement.
The Company has released all material information that relates to Exploration Results for the El Zorro Gold Project, on a continuous basis to the ASX and in compliance with JORC 2012. The Company confirms that it is not aware of any new information that materially affects the content of
this ASX release.
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
2
Investment Highlights
Au
Chanaral
•
•
•
Tesoro (ASX:TSO) holds one of the largest
& most prospective mining permits in the
‘Core Atacama’ Province of Chile.
Cu
TERNERA
Strategically positioned in a tier one
jurisdiction, near infrastructure & surrounded
by world-class mining projects. (1)
Cu/Au
Discovered the El Zorro Project, a well
defined 661,000oz (2) gold orebody. Scoping
study & revised resource expected Q4 2021.
•
Significant exploration potential with less
than 2% of the 555 km2 permit area drilled.
•
Active exploration program underway with
six rigs drilling 60,000 meters over the next
six months.
•
Cu/Fe
Caldera
Fe
Cities
El Zorro Project
Other Mines
Santo Domingo Proposed Port
Yamana Gold License
Copiapo
Airport & Power
Strong Cash Position of A$13.7 million. (3)
Pan American Highway
Cu/Au
Au
Tesoro License (555 km2)
Notes: 1- Refer to Appendix 2 on Chile, 2- Refer to Maiden Mineral Resource, 28 July 2021 in Appendix 3, 3- At 30 June 2021
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
3
Company Strategy & Corporate Snapshot
Strategy
Utilise extensive geological experience to discover, define & develop high quality mining projects in the ‘Core Atacama’ province of Chile.
Mineral Resource (0.3 g/t cut-off) (1)
Mt
2.7
Indicated
Au g/t
0.88
koz
75
Mt
22.4
Capital Structure
Inferred
Au g/t
0.81
koz
586
Mt
25.1
Total
Au g/t
0.82
koz
661
Share Price History (A$)
0.35
0.30
A$0.105
603.2 million
98 million
A$66 million
1,743,085 shares
A$13.7 million
Nil
Shareholders
0.25
Top 20
Board & Management
Wholesale Investors
Other
0.20
0.15
0.10
0.05
51%
18%
24%
58%
Broker Coverage
Jan-21
ASX Share Price (2)
Shares on Issue
Performance Rights
Market Capitalisation
Average Daily Volume
Cash (3)
Debt
Feb-21
Mar-21
Apr-21
May-21
Jun-21
Jul-21
Aug-21
MST Access
PAC Partners
Buy
Speculative Buy
Notes: 1- Refer to Maiden Mineral Resource, 28 July 2021 in Appendix 3, 2- At 30 August 2021 3- At 30 June 2021
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
4
Board & Management
John Toll
Chairman
John is a Partner at Azure Capital Limited
with >15 years of experience in corporate
advisory, focusing mainly on equity
financing transactions across a range of
industries including mining, technology,
general industrials, biotech & infrastructure.
>27 years of international resource sector
experience as a Geologist, Project Manager
& Fund Manager. Previously worked in
Private Equity (FUM USD800 million) & as a
Director of Societe General’s Mining
Finance Team in New York. Operational
roles include Project Manager, Senior Mine
Geologist & Mine Geologist for Ivanhoe
Mines, Lion Ore International & Western
Mining Corporation.
Qualified lawyer with >20 years’ experience
in corporate law & compliance. She is
currently Non-Executive Director of ASX
listed companies Vmoto Limited, Bellevue
Gold Limited & Company Secretary to a
number of public unlisted & listed
companies.
Administrative, management & development
professional with experience in Chile. He has
worked on numerous resource projects from
greenfields exploration, discovery, production,
closure, retreatment & tailings reclamation.
Part of the development team with Fortescue
Metals Group during development of its
Pilbara mining operations, he has 10 years of
resource sector experience. Sergio has
represented numerous foreign companies
investing into resource projects in Chile & was
Commercial Manager of Metallum Chile Ltd.
where he was involved in the acquisition &
development of their operation in Chile. Prior
to this he was General Manager of Acorn
Mining Chile Ltd & Country Manager for
Cleveland Mining Chile Ltd. Sergio has a
Business Management degree from
Universidad del Desarrollo & is a member of
the civil police & a military reserve officer.
Zeffron Reeves
Managing Director
Shannon Coates
Company Secretary
Geologist with >20 years of experience in the resources
sector on resource projects from greenfields exploration,
discovery, definition & feasibility, construction, production
to closure. Zeff previously Managing Director of ASX
listed Metallum Ltd which had a number of development &
operational projects in Chile. He has also held senior
management positions with companies developing
projects in Brazil. He has had previous exploration
success identifying & delineating new gold districts in
Brazil & Chile.
Geoff McNamara
Non-Executive Director
Sergio Uribe
Country Manager, Chile
El Zorro: Chile’s Newest Gold Project
341600mE
(4)
•
Tesoro Owns 85% of the El Zorro project. (1)
7036000mN
341800mE 7036100mN
342200mE
342000mE
TSO Drilling
Mineralised intercept (m/Aug/t)
•
Maiden Mineral Resource of 25.1 Mt @ 0.8 g/t for 661
koz of gold at 0.3g/t Au cut-off including 15.4Mt @ 1.09
g/t for 540koz at 0.5g/t Au cut-off. (2)
Fault
July 2021 Resource Estimate
US$1700/oz Au
Pit Shell
1.0/12.10
600mRL
21.28/0.34
1.0/7.09
•
•
•
•
•
Resource has low sensitivity to lower gold price
RPEEE pit shells. (3)
Scoping Study Underway for an Open Pit Mine
Development. Expected 4Q 2021.
37.0/0.43
incl. 4.0/1.15
Logistical advantages should provide significant CAPEX
& OPEX savings:
• Low Power Costs (12-17c/kwh, less than Australia)
• Distance to Port only 57km
• Distance to Workforce 53km
US$2000/oz Au
Pit Shell
14/0.55
30.5/0.40
76.0/0.93
incl. 12.0/1.39
incl. 18.7/1.57
400mRL
8.0/0.78
26.0/0.49
US$2500/oz Au
Pit Shell
Awaiting Results
26.0/0.49
incl. 56.0/3.49
incl. 1.0/7.73
incl. 8.5/2.49
200mRL
0
36.0/0.40
incl. 1/0.81
4.0/1.83
Good Metallurgy implies Simple Flowsheet. Design to
include Single Stage Crushing & SAG Mill with Gravity &
CIL.
Potential for Attractive Strip Ratio with Outcropping
Orebody.
US$1800/oz Au
Pit Shell
1.7/1.43
8.0/1.08
100
metres
Indicated + Inferred Resource (0.30 g/t cut off)
USD/Oz Gold Price Pit
Mt
Au g/t
1,700
18.3
0.88
1,800
19.4
0.88
2,000
20.9
0.86
2,500
25.1
0.82
Section -140m
+/- 10m
koz
519
548
580
661
Notes: 1- Tesoro may increase its holding of the JV via capital contributions. On the 26 August 2021, 15% JV partner Wanaco disputed the valuation & the procedure followed for the recent capital increase approved in the Shareholders
Meeting of El Zorro SCM held on 11 February 2021. Tesoro is vigorously defending its position and is considering its legal options to have this spurious claim rejected by the court. 2- Refer to Maiden Mineral Resource, 28 July 2021 in Appendix
3. Alternate scenarios using different gold price inputs for the Reasonable Prospects for Eventual Economic Extraction (RPEEE) resource limiting pit shell demonstrate the sensitivity of contained mineralization.
4. Refer ASX announcements 10/06/2020, 4/09/2020, 16/12/2020, 21/12/2020, 25/06/2021, 6/07/2021 and 19/08/2021
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
6
Enormous Exploration Potential
•
Significant Intrusive
Related Gold System
(IRGS) analogous to the
Tintina Province in the
Yukon & Alaska (Fort
Knox, Pogo, Brewery).
•
Minimal historical mining
by artisanal workers at El
Zorro & less than 2% of
the permit area drilled.
•
Ternera deposit open in
all directions with
multiple prospects
identified within close
proximity.
•
Discovery Cost to date
only US$21/oz (half the
global average (2)).
•
Aggressive exploration
planned targeting
>60,000m drilling.
•
Six rigs drilling 24/7.
PERMIT
EXPLORATION TARGETS
TERNERA EXPLORATION
Notes: 1- Refer to Maiden Mineral Resource, 28 July 2021 in Appendix 3. 2- Refer to https://minexconsulting.com/wp-content/uploads/2021/05/Gold-Exploration-Trends-PDAC-May-2021.pdf for discovery costs of US$45/oz
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
7
Recent Activity
Exploration Drilling
Core Shed
Local Workforce
Ternera Drill Rigs in Operation
8
Recent Exploration Highlights
Ternera (1)
New thick high grade gold zones outside
existing resource (see cross section right).
• 205.00m @ 0.96g/t Au; including 21.00m
@ 5.26g/t Au
• 40.00m @ 2.11g/t Au; including 17.50m @
4.51g/t Au
Ternera East (2)
New discovery.
• 21.28m @ 0.34g/t Au; including 4.50m @
1.14g/t Au
• 36.00m @ 0.40g/t Au; including: 4.00m @
1.69g/t Au
Ternera Drill Section +60m looking northwest. Hole ZDDH0170 & ZDDH0164 showing strong gold
mineralisation outside of existing Mineral Resource model and significantly expanding known gold zones.(3)
Notes: 1- Refer to ASX announcement 19 August 2021.
2- Refer to ASX announcement 11 August 2021.
3- Refer to ASX announcements 9/10/2020, 16/2/2021, 27/07/2021, 4/08/2021, 19/08/2021, & 27/08/2021
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
9
New Exploration Targets
•
Drone Hill & Toro Blanco have structural trends & high chargeability
anomalies, as identified by the recently expanded Gradient Array
Induced Polarisation (GAIP) survey (see map on right). (1)
•
Drone Hill first drill hole intersected a high grade gold zone of 11.50m @
1.13g/t Au; including 1.57m @ 7.37g/t Au. (2)
Note: 1- Refer to ASX announcement 16 April 2021.
2 – Refer ASX announcement 23 March 2021
TORO BLANCO
DRONE HILL
TERNERA NORTH
TORO BLANCO
TERNERA EAST
TERNERA EAST
TERNERA
TERNERA
TORO GORDO
TORO GORDO
DRONE HILL
10
Roadmap to Create Shareholder Value
Immediate Focus
• Continue to grow resources at El Zorro via low-cost drilling.
• Identify repeats within the regional El Zorro exploration concessions.
• Complete scoping study & build organisational capability to progress El Zorro to production.
Key Activities for 2021/2022
2021
2022
Q3
Q4
Q1
Q2
Q3
Q4
Exploration & Development
Ternera Resource Drilling (50,000m)
Ternera Mine Drilling
Resource Update
Resource Update
Met Testwork
El Zorro Project
Mining Studies
Financial Analysis
Scoping Study Report
Feasibility Study
Environmental Approvals
FID
Regional
Exploration
Exploration
Ternera East, Drone Hill, Toro Blanco Drilling (10,000m)
Maiden Resource
Drilling
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
Analysis
Approvals
Key Announcements
11
Relative Valuation Offers Material Opportunity
Relative to ASX listed gold peers at study or development stage for projects in Tier One jurisdictions, Tesoro has
significant re-rating potential with broker valuations implying a >4x return. (1)
EV/Resources (A$/oz) (2)
300
250
200
150
100
50
0
Challenger
Company
Challenger
De Grey
Capricorn
Tesoro
ASX Ticker
CEL
DEG
CMM
TSO
Project
Hualilan & El Guayabo
Mallina
Karlawinda
El Zorro
De Grey
Region
Argentina & Ecuador
Australia
Australia
Chile
Capricorn
Status
Exploration
Study
Commissioning
Study
Cut-Off
(g/t)
0.3
0.3
0.3
Tesoro
EV
(A$ million)
179
1,570
791
50
Gold Resource EV/Resources
(koz)
(A$/oz)
627
285
6,800
231
4,228
187
661
76
Notes: 1- Refer to MST Access Broker Report 10 May 2021 (on Tesoro Website), 2- Enterprise Value in AUD at 5 August 2021. All Resource Estimates as per Company Presentations & Resource Updates.
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
12
Appendix 1: Environmental & Social Strategy
Our environmental & social strategy is aligned to the United Nations (UN) Sustainable Development Goals (SDG) with the
company committed to ensuring its exploration & operational activities generate positive sustainability outcomes.
Sustainability Pillars
Summary
Health & Safety
Occupational Health & Safety are fundamental responsibilities Tesoro has towards its workforce. Our
strategies & practices are based on providing a safe workplace for all employees, suppliers &
contractors.
Climate Change
Total GHG emissions on a $ per value basis for newly mined gold is significantly lower than that for
other major metals & mined products. Tesoro is committed to put in place a framework to ensure
future mine developments are built & operated to support global greenhouse mitigation targets.
Environment
Tesoro applies leading exploration techniques, technology & practices to promote drilling efficiency &
minimise environmental impacts. Furthermore Tesoro is committed to continual improvement of its
environmental performance through a robust environmental management program.
People & Culture
Attracting, developing & retaining a diverse, inclusive & competent workforce is important to Tesoro &
a key foundation to the company's policies and practices.
Community Partnerships
Tesoro partners with the local & host communities of the Coastal Cordillera region of Chile to share
value through the creation of local jobs & business opportunities.
Economic Sustainability
Generating economic growth & value for all our investors, employees & stakeholders through
successful exploration & investment in the Coastal Cordillera region of Chile.
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
UN SDG
13
Appendix 2: Why Chile
1) Low Sovereign Risk: Chile has a population of over 19 million people & is considered to be one of South America’s most
stable & prosperous nations, enabling the country to significantly reduce poverty. Chile’s gross domestic product (GDP) is
expected to rebound to 5.5% in 2021 (1), on the back of government stimulus & a rapid COVID-19 vaccination rollout (one
of the best in South America).
2) Extremely Low Corruption: Chile ranks in the top quartile of countries in Transparency International’s 2020 Corruption
Index, equal with the United States of America.
3) Supportive Government Policy Towards Mining: Mining is a major driver of the Chilean economy, contributing to more
than 50% of Chile’s exports & 9% of GDP. The Fraser Institute’s 2020 (2) annual survey ranked Chile as the best country in
South America for mining exploration investment based on public policy factors such as tax rates & regulation.
4) Significant Mineral Endowment: As the top producer of both copper & iodine in the world, Chile is also home to several
other highly valuable natural resources including molybdenum, selenium, rhenium, nitrates, iron ore, lithium & of course
precious metals such as gold. Most of the world’s largest mining companies operate in Chile.
Source: 1-World Bank, 2- https://www.fraserinstitute.org/sites/default/files/annual-survey-of-mining-companies-2020.pdf
TESORO RESOURCES (ASX:TSO) | CORPORATE PRESENTATION
14
Appendix 3: Mineral Resource
Maiden Mineral Resource Estimate of 661 koz gold announced on 28 July 2021
Cut-off Au g/t
0.3
0.4
0.5
0.6
0.7
0.8
Mt
2.7
2.1
1.7
1.4
1.2
0.9
Indicated
Au g/t
0.88
1.03
1.17
1.28
1.4
1.64
koz
75
68
63
58
54
45
Mt
22.4
17.4
13.7
11.1
8.9
6
Inferred
Au g/t
0.81
0.95
1.08
1.21
1.34
1.61
koz
586
529
476
430
385
312
Mt
25.1
19.4
15.4
12.5
10.1
6.9
Total
Au g/t
0.82
0.96
1.09
1.22
1.35
1.62
koz
661
597
539
488
439
357
Mineral Resource Estimate Parameters
• 148 HQ diameter diamond drill holes used (46,937m)
• Domaining based on 3D modelling of lithology (El Zorro Tonalite) & faults
• Resource Classification Criteria:
• Geological continuity and volume;
• Drill spacing & drill data quality;
• Modelling technique; and
• Estimation properties, including search strategy, number of informing composites, average distance of composites from blocks & kriging quality parameters.
• Mineral Resource has been reported above a 0.30 g/t Au cut-off. Selection of the cut-off has considered results of metallurgical testing (ASX release 9 June 2020). The applied cut-off has been
reviewed against that reported from peer projects with similar mineralisation styles and proposed processing options & is considered comparable.
Pit Optimisation Parameters
• It must be noted that the optimisation pit shell provided was for the purpose of constraining the Resource model only and is NOT an economic assessment of an open pit mining operation at El Zorro
or indicates the economic gold price required for potential future mining at El Zorro.
• The optimization was completed to delineate the portion of the Resource estimate that could potentially be mined by an open pit at some time in the future. The pit optimization was based on certain
assumptions that are considered at to be preliminary & have a high degree of uncertainty. The purpose of the optimization is to provide a constraint around the resource with some explained economic
parameters.
• The gold price selected for the pit optimization was based on cut-off grade calculations using the conceptual cost, recovery and dilution inputs as outlined above, to match the geological cut off grade in
the Mineral Resource Estimate. A gold price of US2,500/oz provides an estimated cut off grade for an optimized pit shell of approximately 0.3g/t Au, in line with the Mineral Resource cut-off grade.
15
Tesoro Resources Limited
Suite 5, 62 Ord Street
West Perth, WA 6005
Phone: +61 8 9322 1587
Email: info@tesororesources.com.au
Web: www.tesororesources.com.au
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