CORPORATE PRESENTATION FEBRUARY 2021 TSX HRT
|
FRANKFURT H4O
|
OTC HRTFF
GOLD PRODUCTION GROWTH. PROLIFIC MINING REGION. www.hartegold.com @HarteGold Harte Gold Corp TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
1
Disclaimer
Cautionary Statements Regarding Forward-Looking Information and Non-IFRS Financial Measures Certain information contained or incorporated by reference in this presentation of Harte Gold Corp. (“Hart Gold” or the “Company”), including any information relating to the Company’s strategy, the Sugar Zone Mine Property, plans or future financial or operating performance, constitutes “forward-looking statements”, within the meaning of applicable securities legislation. All statements, other than statements of historical fact, are forward-looking statements. The words "seek", "anticipate", "budget", "plan", "continue", “envisage”, "estimate", "expect", "forecast", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar words suggesting future outcomes or statements regarding an outlook identify forward-looking statements. In particular, this presentation contains forward-looking statements including, without limitation, with respect to: announcing Feasibility Study results in early Q1 2021; 2021E gold production of 60,000 to 65,000 ounces; achieving 800 tpd mine production in Q1 2021; increasing development rates to over 13 metres per day by Q1 2021; increasing the number of active mining areas to six by Q1 2021; estimates of total cash costs per ounce, AISC per ounce, projected capital, operating and exploration expenditures; mine life and production rates; estimated timing for continued development of and production from, the Sugar Zone Mine Property; anticipated gold production from the Sugar Zone Mine Property; the relationship between the Company and BNP Paribas and Appian; and further exploration activities. Forward-looking statements are necessarily based upon a number of estimates and assumptions including material estimates and assumptions related to the factors set forth below that, while considered reasonable by the Company as at the date of this presentation in light of management’s experience and perception of current conditions and expected developments, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements and undue reliance should not be placed on such statements and information. Such factors include, but are not limited to: fluctuations in the spot and forward price of gold; the speculative nature of mineral exploration and development; changes in mineral production performance; exploitation and exploration successes; Company’s ability to attract and retain qualified candidates to join the Company’s management team and board of directors; diminishing quantities or grades of reserves and resources; increased costs, delays, suspensions and technical challenges associated with the development and construction of capital projects; operating or technical difficulties in connection with mining or development activities, including geotechnical challenges and disruptions in the maintenance or provision of required infrastructure and information technology systems; failure to comply with environmental and health and safety laws and regulations; timing of receipt of, or failure to comply with, necessary permits and approvals; uncertainty whether the Sugar Zone Mine Property targeted investments will meet the Company’s capital allocation objectives and internal hurdle rate; the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future cash flows; the impact of inflation; fluctuations in the currency markets; damage to the Company’s reputation due to the actual or perceived occurrence of any number of events, including negative publicity with respect to the Company’s handling of environmental matters or dealings with community groups, whether true or not the possibility that future exploration results will not be consistent with the Company’s expectations; risks that exploration data may be incomplete and considerable additional work may be required to complete further evaluation, including but not limited to drilling, engineering and socioeconomic studies and investment; risk of loss due to acts of war, terrorism, sabotage and civil disturbances; litigation and legal and administrative proceedings; business opportunities that may be presented to, or pursued by, the Company; risks associated with employee relations including loss of key employees; increased costs and physical risks, including extreme weather events and resource shortages, related to climate change; and availability and increased costs associated with mining inputs and labor. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold concentrate losses (and the risk of inadequate insurance, or inability to obtain insurance, to cover these risks). Many of these uncertainties and contingencies can affect our actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, us. Readers are cautioned that forward-looking statements are not guarantees of future performance. All of the forward-looking statements made in this presentation are qualified by these cautionary statements. Specific reference is made to the most recent Annual Information Form and in other filings of the Company with securities and regulatory authorities which are available on SEDAR at www.sedar.com for a more detailed discussion of some of the factors and risks underlying forward-looking statements that may affect the Company’s ability to achieve the expectations set forth in the forward-looking statements contained in this presentation. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law In this presentation we use the terms “EBITDA”, “cash operating cost” and “All-In Sustaining Cost” or “AISC”. These should be considered non-IFRS financial measures as defined in applicable Canadian securities laws and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. For additional information regarding non-IFRS financial measures used by the Company, please refer to the heading “Non-IFRS Measures” in the Company’s Management Discussion and Analysis for the three months ended September 30, 2020 and 2019, available at www.sedar.com.
All dollar amounts stated are denominated in Canadian dollars ($) unless specified otherwise. All tonnages in metric, unless otherwise noted.
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
2
Harte Gold Overview
• Prolific gold producing region of Ontario
• Operational turnaround in in 2020 • Feasibility study provides a compelling multi-year production growth trajectory • Massive district-scale land package with untapped exploration potential • Cleaning up the balance sheet for maximum financial flexibility
Producing gold mine and significant land package (over 79,000 ha) TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
3
Sugar Zone Property Comparison
AGNICO EAGLE
Sugar Zone Property
• Largest property in Ontario1 • 5th largest in Canada1 • One of a handful of “independent” deposits • P+P Mineral Reserves: 797 Koz Au @ 7.2 g/t Au • Significantly underexplored
Property
Meadowbank
Brucejack
Meliadine
Hope Bay
Sugar Zone
Detour Lake
Red Lake
168,613
121,811
111,358
110,100
79,335
64,577
46,000
Measured + Indicated Resources
1,160
6,700
2,799
5,173
1,070
4,505
2,530
Inferred Resources
1,520
2,300
2,631
2,127
567
1,260
2,390
Size (hectares)
1)
Selected property packages in Canada ranked by size (hectares)
Source: public company information, management estimates
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
4
Executing On Vision & Strategy
1.
✓
Achieve operational excellence
✓
Expansion to 1,200 tpd
2.
3.
• Transformational change is underway – 800 tpd in Q1 2021
• Feasibility Study provides a pathway for growth: 2023 and beyond
Define exploration potential • Exploration update and strategy: Mid-Q1 2021
2021 AND BEYOND
Capital Structure 4.
• Continuing discussions with BNP: Underpinned by strong relationships with both BNP and Appian, all options are being explored
Corporate Strategy 5.
• Define long-term strategic priorities
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
5
Managing Leading Indicators For Future Success KPIs trending positively, setting the stage for growth in 2021
Processed Grade
Mine Development metres per day
11.4
13.1
13.5
January Actual
FY 2021E
7.7
g/t Au 5.7
7.1 5.7
9.2
Q3 2020
Q4 2020
Mill Production*
Q3 2020
Q4 2020
January Actual
FY 2021E
Ounces Recovered
tonnes per day
700 473
503
Q3 2020
Q4 2020
800
Avg. oz Au per month 3100
January Actual
FY 2021E
Q3 2020
5200 3611
3785
Q4 2020
January Actual
FY 2021E
* Q3 represents mine production after mine restart
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Positive Feasibility Study Results For Expansion To 1,200 tpd Defines growth potential
✓ Mine life: 9 years (2021 to 2029)
Gold Production Growth
✓ Expansion Capital: $21 million, of which a majority is to be
+58%
spent in 2022
98,700
58% increase over 2021 estimates
✓ AISC reduction: US$1,025/oz, post expansion
✓ Expansion timeline: Start by Q3 2021, with benefits of 1,200 tpd starting Q1 2023
✓ Free cash flow growth: $96 million by 2023, 166% increase
Gold Production (oz Au)
✓ Production growth: 98,700 oz / year average post expansion, 60,000–65,000
25,649
over 2021 estimates (analyst prices)
✓ NPV: Pre-tax NPV5% of $417 million, after-tax NPV5% of $332 million at analyst consensus prices
✓ Incremental IRR: 89% at analyst consensus prices TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
2020
2021E
2023E – 2027E
Sugar Zone Restart and Ramp-up
800 tpd Sugar Zone Only
1,200 tpd Sugar Zone + Middle Zone
7
“Top Down” Mine Design and Schedule Middle Zone
Sugar Zone North
Sugar Zone South
Year 2021 2022 2023 2024 2025
2026 2027 2028 2029
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Underground Development and Ounces Per Vertical Metre Illustrative Comparison to Nearby Mines
Oz Au per Vertical Metre
Oz/vertical metre - Planned
Ounces/vertical metre - cumulative
~10,000 850
944
@ 7.2 g/t Au
First 9 yrs @ 5.8 g/t Au Last 5 yrs @ 9.6 g/t Au
890
@ 9.6 g/t Au
7.2 g/t
Producing: Island Gold Mine 14 years
Producing: Eagle Mine 25 years
Hemlo
2 years
Eagle
Producing: Sugar Zone Mine
Island Gold
(400)
Sugar Zone
Vertical Development (metres)
0
Producing: Hemlo 35 years
(800) 10.4 g/t
(1,200)
14.4 g/t
Island Deep Area
(1,600)
Mine Development
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Reserves
Inferred Boundary
9
Project NPV5% NPV5% Summary – Before Hedge, Debt and Corporate Costs
Sensitivity Analysis – After-Tax (C$m)
2021
2022
2023
2024
2025+
Analyst Consensus Prices
1,938
1,871
1,782
1,735
1,624
$476 $420
$402 $371 $332
$329
$321
$267
Analyst Consensus
US$1,600
CAD:USD Expansion Capital
$549
Pre-Tax NPV After-Tax NPV $417
Gold Price Mine Costs Sustaining Capital
US$1,700
US$1,800
US$1,900
After-Tax NPV5% (CAD Millions)
Project NPV5% (CAD Millions)
US$/oz
$450
$426
$354 $350
$332
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
$310
$250
$254
$245
$150 -10%
Flat Gold Price (US$/oz Au)
$417
-5%
Base Case
5%
10%
+ / - % Change in Input 10
Cumulative Free Cash Flow (After-Tax) US$1,600
US$1,700
Analyst Consensus
US$1,800
US$1,900
After-Tax Cash Flow, Cumulative (C$ MIllions)
$600
$528 $500
$467 $412 $406
$400
$341 $300
$200
$100
$0 2021
2022
2023
2024
2025
2026
2027
2028
2029
Cumulative after-tax, unlevered, before corporate costs and hedge payments
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Opportunities to Further Enhance Value •
Expansion of near-mine mineralization along strike •
•
Expansion of mineralization at depth
• •
Step-out and infill drilling along strike at Sugar Zone South, Middle Zone and Wolf Zone to add additional sources of ore feed, increasing overall ounces per vertical metre
Infill drilling of Inferred Resources at depth to extend mine life
Cost optimization, particularly related to paste backfill vs. rockfill •
Complete a trade-off study analysis of continuing solely with rockfill as a primary backfill method, instead of paste backfill, with the potential of further reducing operating and capital costs
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Near-mine Exploration Potential Opportunity grow mineralization along strike and at depth
Three undeveloped zones along strike: Lynx, Wolf, and Fox
Lynx Zone
Sugar Zone South Extension
Sugar Zone
Middle Zone
Wolf Zone
Fox Zone North
0m
500m
?
? ?
1,000m
?
Indicated and Inferred Resources ≥ 3 g/t
1 km
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
?
? 1 km
1 km
13
Regional Exploration Defining property exploration potential
Surface Prospecting Work Completed at TT8 •
TT8 Zone at the Southeast Area of the Sugar Zone Property
Prospecting returned five mineralized showings, extending overall TT8 mineralized trend up to 11 km
Regional Workplan for 2021 •
Systematic database compilation of historical data (drilling, geophysics, magnetics, structural mapping and surface prospecting)
•
Complete lithological mapping and Geochem to define improved drilling targets for 2021
•
Continue drilling the TT8 structure testing for width and steeper plunging mineralization
•
Line cutting and IP at the southern extension of TT8 also underway to better understand structure Selected mineralized showings TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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SUMMARIZING THE OPPORTUNITY TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
Summarizing the Opportunity
Growing from a Solid Operational Base
Significant Growth Trajectory
• Significant operational improvement in 2020
• 2020: 25k oz
• Exceeded 2020 guidance
• Post-expansion: ~100k oz
• Transition to owneroperator complete
• 2021E: 60-65k oz • Post-expansion AISC to decrease to US$1,025/oz
Minimal Capital Cost to Expand
Potential to Extend Mine Life
• $21M (majority to be spent in 2022)
• Near-mine extension drilling
• 89% incremental IRR for expansion project
• TT8 prospecting and drilling
• $417M pre-tax NPV
• Defined pipeline for long-term growth • Further data compilation
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Significant Production Growth, Low Cash Cost Position Market Capitalization(1) (C$M)
Wesdome
$1,281
Pure Gold
$880
Victoria
$815
Argonaut
$735
Calibre
$644
Roxgold
$556
Karora
Argonaut
255
$484
Americas G&S
Roxgold Harte (2023E)
$651
Calibre
188
Pure Gold
$685
Wesdome
$686
McEwen
147
Roxgold
126
Mandalay
$688
Wesdome
120
Victoria
$695
Mandalay
117
TMAC
$794
102
Calibre
$806
Karora
101
Harte (2021E)
$823
Argonaut
$864
TMAC
99
Superior
91
+64%
Americas G&S(3)
$191
Harte Gold
$145
Pure Gold
68
Superior
Fiore Gold
$115
Harte (2021E)
62
Fiore Gold
$84
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
(21%)
Harte (2023E)
Mandalay
Superior
$592
195
$389 $284
2021E Cash Cost(2) (US$/oz Au)
Victoria
$531
McEwen
TMAC
2021E Production(2) (koz Au)
Americas G&S(3)
Fiore Gold 1. 2. 3.
85
48
Karora
$868 $882
McEwen
Market data as at January 19, 2021 Based on analyst consensus estimates of production and cash cost. Harte based on January 2021 Feasibility Study Americas Gold & Silver shown on an AuEq basis
$981 $1,006 $1,167
17
APPENDIX TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Setting the Stage: Operational Summary Sugar Zone mine posts a strong finish to 2020 Record quarterly production in Q4 2020 and guidance beat for FY 2020 • Q4 2020: Production of 10,835 ounces Au, highest quarterly period on record • FY 2020: Production of 25,649 ounces Au exceeds upper range of 2020 guidance (20,000-24,000 ounces)
2020 Operating Summary
Ore Tonnes Processed Head Grade Recovery Gold Ounces Produced
Unit
FY 2020
Q4 2020
Q3 2020
Q1 2020
tonnes
134,360
46,288
36,367
51,705
g/t Au
6.3
7.7
5.7
5.5
%
94.2%
94.9%
93.4%
94.0%
oz Au
25,649
10,835
6,218
8,597
The above table compares Harte Gold’s operating performance for Q4 2020 relative to the previous quarters of operations for 2020. In Q2 2020, operations were placed on temporary care-and-maintenance due to the COVID-19 pandemic so is not considered an operating quarter.
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Updated Resource Modelling Underpins The Feasibility Study Mineral Resource Estimate (September 30, 2020) Classification
Indicated
Inferred
Zone
Tonnes (kt)
Grade (g/t Au)
Ounces (koz Au)
Sugar
1,315
15.53
657
Middle
1,326
8.95
381
162
6.13
32
Total
2,803
11.87
1,070
Sugar
891
10.98
314
Middle
844
8.21
223
Wolf
132
7.04
29
1,866
9.45
567
Wolf
Total
Mineral Reserve Estimate (December 31, 2020) Classification Probable
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Zone
Tonnes (kt)
Grade (g/t Au)
Ounces (koz Au)
Sugar
1,994
7.59
487
Middle
1,460
6.62
311
Total
3,454
7.18
797
20
Mine Design and Schedule Mine design •
Deswik stope optimizer used to evaluate the resource block model
•
Cut-off grade of 5.0 g/t Au used to evaluate the overall reserves and mine design
•
Sills developed on 15 metre levels (Sugar Zone), 20 metre levels (Middle Zone)
Optimized underground development •
Decline and lateral waste and ore development were designed to efficiently access stoping blocks
•
Costs determined by zero-base and historical methods. Key drivers include: labour, equipment availability and utilization and UG infrastructure
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Ore Tonnes Processed and Grade
500,000
10.0
LOM grade: 7.2 g/t Au* 8.7 8.1
8.0
7.7
7.1
6.9
7.1
7.0
6.6
300,000
6.0
5.4 200,000
4.0
100,000
2.0
0
0.0
2021
2022
800 tpd TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
2023
2024
2025
2026
2027
2028
Grade (g/t Au)
Processed Tonnes
400,000
2029
1,200 tpd * Average recovery 94.3% over LOM
22
Gold Production (Oz Au)
800,000
114,085 102,261 92,136
93,239
91,997
90,000
600,000 71,812
67,570
62,458 56,044
60,000
30,000
400,000
200,000
0
Cumulative Production (oz Au)
Recovered Annual Production (oz Au)
120,000
0 2021
2022
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
2023
2024
2025
2026
2027
2028
2029
23
Operating Cost Summary •
Total site costs: $221 per tonne, decreasing to $197 per tonne post expansion
•
Mining:
• •
•
Processing
Site G&A 90 0
80 0
Unit haulage and backfill costs increase as operations continue deeper in the mine Offset by economies of scale
Processing: •
Mining 300
Decrease 22% on a per unit basis following expansion
Site G&A:
250
Unit Costs ($/tonne)
•
Site Operating Cost Breakdown
704
221
70 0
197 200
58 43
150
43
163
122
34
50 0
40 0
100 50
60 0
30 0
120
120
420
20 0
10 0
•
Decrease 25% on a per unit basis as a large portion of site costs are fixed and will benefit with scale
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
0
0
2021 $/tonne
2023-2027 $/tonne
LOM C$m
24
Expansion Capital Summary •
Expansion capital of $21.1 million incurred from mid-2021 to Q1 2023
•
Mill Expansion:
LOM Expansion Capital Summary (C$m)
Mill Expansion 18.0
•
Addition of a second ball mill
•
Two additional rougher flotation cells and one cleaner cell
• •
Replace secondary cone crusher
Additional tailings thickener
Expansion mine equipment: Additional 30 tonne haul truck
•
Three additional LHD loaders
2.3 20
4.6
12.0 15
10.0
8.0 14.0
6.0
10
2.5 2.0
2.3 2.3
0.1 2.4
16.3 5
2.3
0.0
0
2021 •
21.1
14.0
4.0 •
Permitting 25
16.3 16.3
16.0 Unit Costs ($/tonne)
•
Mine Equipment
2022
2023
LOM
Ancillary equipment
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25
Mill Expansion
Additional Process Plant Equipment Highlighted in Blue
Expanded Gold Room
Tailings Thickener
Additional Ball Mill
Expanded Crushing Circuit
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Expanded Flotation Circuit
26
Mine Sustaining Capital •
Underground Capital: paste distribution, mine ventilation, underground shops and infrastructure.
•
Tailings and Water Management: Expansion of the North TMF, construction of the South TMF and water management.
•
•
•
•
Mine Equipment Maintenance: Overhaul and major component replacement of the equipment fleet. Underground Electrical: Distribution of electrical equipment for ventilation, drilling and dewatering. Paste Backfill: Substitution of the existing ceramic disk filtration system with a cloth disk filter. Reclamation / Closure Costs: Incurred at the end of mine life.
LOM Total ($m) Underground Capital
31
Tailings and Water Management
27
Mine Equipment Maintenance
18
Underground Electrical
14
Paste Backfill
15
Reclamation / Closure Costs Other
Total Sustaining Capital
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
8 11
126
27
Development Metres (m)
Underground Capital Development 6,000
Underground Development:
5,000
LOM total: 34,500 metres LOM costs: $199 million Annual Average: 3,800 m / year Average development rate (2022+): 11.5 m / day
4,000
3,000
2,000
1,000
0 2021
2022
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
2023
2024
2025
2026
2027
2028
2029
28
Production and AISC Profile 120,000
2023 to 2027:
114,085
2,000
Production: 98,700 oz Au AISC: US$1,025/oz Au
90,000
92,136
71,812 1,430
93,239
91,997
1,354
1,336
62,458
1,117
60,000
67,570
1,002
1,500
56,044 1,157
1,074
1,048
1,000
884
30,000
Cash Cost (US$/oz)
Recovered Annual Production (oz Au)
102,261
500
0
0 2021
2022
2023
2024
2025
Gold Recovered (oz Au)
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
2026
2027
2028
2029
AISC (US$/oz)
29
Capital Structure Opportunities to enhance current capital structure to support long-term growth
Working Capital
Figures in CAD mm
$89M
Lender: BNP Paribas
Hedge: ~20k oz/yr (through 2023)
Interest rate: LIBOR + 4.375%
Price: ~US$1,390/oz
Working capital position has been reset
Term Loan Maturity ($61M): Jun-2025 Revolver Maturity ($28M): Jun-2022
$37M
Lender: Appian (major shareholder of Harte Gold)
Senior BNP Debt
Interest rate: 14%, paid in shares
Discussions underway on re-sculping debt
Maturity: Jun-2023
$145M* Basic S/O: 878.7 million Fully diluted S/O: 973.3 million Major shareholder: Appian, at 25% 1 CAPITAL STRUCTURE
Hedge Minimize impact by growing production
* Share price as February 11, 2021
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30
Corporate Summary Market Information
Senior Credit Facility
Headquartered: Toronto Ontario
Lender: BNP Paribas
Basic Shares Outstanding: 878.7 million
Interest rate: LIBOR + 4.375%
Fully DilutedShares Outstanding: 973.3 million
Maturity: March 2025
Market Cap (C$) $145 million (as at Jan 11, 2021)
Gold hedge: ~20,000 annually through 2023 @ US$1,390/oz
Markets: TSX: HRT Frankfurt: H40 OTCBB: HRTFF
Significant Shareholders
Share price performance (Last Twelve Months) $0.25
Mackenzie: 2% J. Zechner: 1%
Analyst Coverage Haywood:Target price: $0.30
HRT share price (C$)
Appian Capital: 25% $0.20
$0.15
$0.10
$0.05
$0.00 Jan-20
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
Apr-20
Jul-20
Oct-20
Jan-21
31
NI 43-101 Compliance Unless otherwise indicated, Harte Gold Corp. (the “Company”) has prepared the technical information in this presentation including Mineral Reserve and Mineral Resource estimates (“Technical Information”) based on information contained in the technical reports and news releases (collectively the “Disclosure Documents”) available under the Company’s profile on SEDAR at www.sedar.com. Each Disclosure Document was prepared by or under the supervision of a qualified person (“Qualified Person”) as defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators (“NI 43-101”). For readers to fully understand the information in this presentation, they should read the technical reports identified below in their entirety, including all qualifications, assumptions and exclusions that relate to the information set out in this presentation which qualifies the Technical Information. Readers are advised that Mineral Resource estimates that are not Mineral Reserves do not have demonstrated economic viability. The Disclosure Documents are each intended to be read as a whole, and sections should not be read or relied upon out of context. The Technical Information is subject to the assumptions and qualifications contained in the Disclosure Documents. The Mineral Reserve estimate was prepared under the supervision of Mr. Chris McCann (P.Eng), Director of Technical Services for the Company. Mr. McCann is a Qualified Person as defined by NI 43-101. The Mineral Resource estimate was prepared by Mr. Vincent Cardin-Tremblay (P.Geo), former VP Geological Services for the Company. Mr. Cardin-Tremblay is a Qualified Person as defined by NI 43-101. The Mineral Reserve estimate in this presentation is current to December 31, 2020. The Mineral Reserve estimate was prepared using the resource model under the Mineral Resource estimate. For further Technical Information refer to the Company’s news release “Harte Gold Announces Positive Feasibility Study Results for Expansion to 1,200 tpd” dated January 20, 2021 and the “Technical Report and Feasibility Study On The Sugar Zone Gold Operation”, dated February 14, 2019, available on the Company’s SEDAR profile at www.sedar.com.
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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Notes to Mineral Resource and Mineral Reserve Estimates The Mineral Resource estimate in this presentation is dated September 30, 2020 and the Mineral Resource ounces are inclusive of the Mineral Reserve ounces. 1.
2. 3. 4. 5. 6. 7.
8.
The stated Mineral Resources comply with the requirements of National Instrument 43-101 – Standards of Disclosure for Mineral Projects ("NI 43-101") and are classified in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum's "CIM Definition Standards – For Mineral Resources and Mineral Reserves" (the “CIM Definition Standards”). Mineral Resources, which are not Mineral Reserves, do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues. The Inferred Mineral Resource in this estimate has a lower level of confidence than that applied to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of the Inferred Mineral Resource could be upgraded to an Indicated Mineral Resource with continued exploration. The Mineral Resource estimate was prepared by Mr. Vincent Cardin-Tremblay (P.Geo), former VP Geological Services for the Company. Mr. Cardin-Tremblay is a QP as defined by NI 43-101. Mineral Resources have been estimated as of September 30, 2020 using a gold price assumption of US$1,600 per ounce Au. A resource cut-off grade of 3.0 g/t Au has been estimated based on operating cost projections and applicable metallurgical recovery. The cut-off grade was used in combination with a minimum mining width factor of 1.8m to define the resource. Numbers may not add due to rounding.
The Mineral Reserve estimate presented in the following table is current to December 31, 2020. 1. 2. 3.
4. 5. 6.
The stated Mineral Reserves comply with the requirements of NI 43-101 and are classified in accordance with the CIM Definition Standards. Mineral Reserve estimates reflect the Company's reasonable expectation that all necessary permits and approvals will be obtained and maintained. Mineral Reserves are the economic portion of the Indicated Mineral Resources. Mineral Reserve estimates include mining dilution at grades assumed to be zero. The 2020 Mineral Reserve estimate was prepared under the supervision of Mr. Chris McCann (P.Eng), Director of Technical Services for the Company. Mr. McCann is a QP as defined by NI 43-101. The Mineral Reserves were estimated as of December 31, 2020 using a gold price assumption of US$1,450 per ounce Au. A mining cut-off grade of 5.0 g/t Au has been estimated based on operating cost projections, sustaining capital development cost, mining dilution and recovery, royalty payment requirements and applicable metallurgical recovery. Numbers may not add due to rounding.
TSX: HRT | FRANKFURT: H4O | OTC: HRTFF
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