Zonia Copper Oxide Deposit - May 2021 - TSX-V: CDU | www.cardero.com - Cardero Resource Corp.
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TSX-V: CDU | www.cardero.com May 2021 Zonia Copper Oxide Deposit Arizona, USA
Forward Looking & Cautionary Statements This presentation contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable Canadian and US securities legislation. All statements, other than statements of historical fact, included herein including, without limitation, statements regarding any potential increase in shareholder value through the acquisition of undervalued precious metal deposits for development, joint venture or later disposition, the potential to partner with mine developers to achieve production at any of the Company’s properties (existing or future); the potential for the capital costs associated with any of the Company’s existing or future properties to be low; the potential for the Company to outline resources at any of its existing or future properties, or to be able to increase any such resources in the future; concerning the economic outlook for the mining industry and the Company’s expectations regarding metal prices and production and the appropriate time to acquire precious metal projects, the liquidity and capital resources and planned expenditures by the Company, the completion of the acquisition of the Zonia project; the anticipated content, commencement, timing and cost of exploration programs, anticipated exploration program results and the anticipated business plans and timing of future activities of the Company, are forward-looking statements. Forward-looking statements are based on a number of assumptions which may prove incorrect, including, but not limited to, assumptions about the level and volatility of the price of gold; the timing of the receipt of regulatory and governmental approvals; permits and authorizations necessary to implement and carry on the Company’s planned exploration programs at its properties; future economic and market conditions; the Company’s ability to attract and retain key staff; and the ongoing relations of the Company with its underlying lessors, local communities and applicable regulatory agencies. Accordingly, the Company cautions that any forward-looking statements are not guarantees of future results or performance, and that actual results may differ, and such differences may be material, from those set out in the forward-looking statements as a result of, among other factors, variations in the nature, quality and quantity of any mineral deposits that may be located, the Company’s inability to obtain any necessary permits, consents or authorizations required for its activities, material adverse changes in economic and market conditions, changes in the regulatory environment and other government actions, fluctuations in commodity prices and exchange rates, the inability of the Company to raise the necessary capital for its ongoing operations, and business and operational risks normal in the mineral exploration, development and mining industries, as well as the risks and uncertainties disclosed in the Company’s most recent management discussion and analysis filed with various provincial securities commissions in Canada, available at www.sedar.com. The Company undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this presentation or to reflect the occurrence of unanticipated events except as required by law. All subsequent written or oral forward-looking statements attributable to the Company or any person acting on its behalf are qualified by the cautionary statements herein. John Drobe, P.Geo., a Qualified Person as defined by National Instrument 43-101, has reviewed and approved the technical information contained in this presentation and has approved the disclosure herein. John Drobe is not independent of the Company, as he holds common shares of the Company. 2 TSX-V: CDU | www.cardero.com
Project Location in Central Arizona
▪ Arizona responsible for 65% of US copper VMS
Past-producers
production and undeveloped
▪ $4.87 billion impact on state economy Active mines
Porphyries
▪ 51,200 mining-related jobs annually
Past-producers
and undeveloped
Active mines
Permitting Advantage: Resource and Phase I production Zonia Project Location
Contained within 100%-owned private land.
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Preliminary Economic Assessment – March 2018
Base case uses $2.00/lb Cu designed pit shell & $3.00/lb Cu price
PRODUCTION PROFILE
▪ After-tax NPV8% of $177 million Total Tons Leached 92.6 million
Head Grade 0.30%
▪ After tax IRR of 29%, with a 2.89 Mine Life 8.6 years
year payback of initial capital Payback Period 2.89 years
Mill throughput 30,000 tpd
▪ Initial capital cost of $198 million Copper Recovery (oxide) 73%
▪ Cumulative Net Cash Flow After Copper Recovery (transition) 70%
Total Copper Recovered 421.5 million lbs
Taxes of $331 million Average Annual Production 49.1 million lbs
NPV@10% Sensitivity to Changes OPERATING COSTS
Mining Costs $0.64/lb of copper
Processing Costs $0.74/lb of copper
G&A $0.08/lb of copper
CAPITAL REQUIREMENTS
Initial Capital $198million
Sustaining Capital $40.8 million
The PEA is preliminary in nature and includes inferred mineral
resources that are too speculative geologically to have economic
considerations applied to them that would enable them to be
categorized as mineral reserves. There is no certainty that PEA
results will be realized. Mineral resources are not mineral reserves
and do not have demonstrated economic viability.
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NI 43-101 Resource Estimate
▪ Measured and Indicated Resources of 76.8 million short tons grading 0.33% copper containing
43-101 Resource Estimate
510 million pounds of copper (0.2% copper cut-off grade).
▪ Inferred Resources of 27.2 million short tons grading 0.28% copper containing 154.6 million
pounds of copper (0.2% copper cut-off grade).
▪ Low strip ratio of 1:1 waste to mineralized material in base case.
Cut-Off Grade Short Tons Copper Contained
Classification
(% Cu) (x ‘000) (%) Copper (M lbs)
Measured 0.2 15,400 0.42 129.3
Indicated 0.2 61,400 0.31 380.6
Measured & Indicated 0.2 76,800 0.33 510.0
Inferred 0.2 27,200 0.28 154.6
Cut-Off Measured & Indicated Inferred
Strip
Grade Short Tons Copper Contained Short Tons Copper Contained
Ratio
(% Cu) (x ‘000) (%) Copper (M lbs) (x ‘000) (%) Copper (M lbs)
0.25 1.96 54,500 0.43 312.6 16,200 0.37 63.2
0.20 1.01 76,800 0.33 510.0 27,200 0.28 154.6
0.15 0.52 96,200 0.30 578.6 41,600 0.25 205.5
Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part
of the Mineral Resources will be converted into Mineral Reserves. Inferred resources are that part of a Mineral Resource for which
quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to
imply but not verify geological and grade or quality continuity. It is reasonably expected that the majority of Inferred Mineral Resources
could be upgraded to Indicated Mineral Resources with continued exploration.
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NI 43-101 Resource Estimate Input Value
Mining Cost $1.50/t
Process Cost $3.40/t
Resources are stated within a Lerch- G&A $0.45/t
Grossman optimized pit shell using Recovery Oxide 73%
Recovery Transition 70%
the following parameters:
Recovery Primary Sulfide 0%
Pit Slope 45°
Cu Price $2.50/lb
Zonia Block Model on DTM
Blocks with Total Cu > 0.1%
NW
SE
~500 metres
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Cross Section Through Centre of Deposit 7 TSX-V: CDU | www.cardero.com
Zonia 100% Owned by Cardero
Date Cash (US$) Cardero Shares
▪ Cardero acquired a 100% interest in
Initial Payment $25,000 (paid) - the Zonia copper oxide deposit in
November, 2018
August 30, 2015 $26,350 (paid) -
October 15, 2015 $150,000 (paid) 1,000,000 (issued) ▪ Total consideration was US$1,925,000
and 22,679,099 common shares of
January 31, 2016 $75,000 (paid) 1,500,000 (issued) Cardero Resource Corp.
July 31, 2016 $75,000 (paid) -
* For the final cash payment of
January 31, 2017 $450,000 (paid) 2,500,000 (issued) US$573,650, Cardero made five equal
installments of US$126,060
July 31, 2017 - 2,500,000 (issued) commencing on November 6, 2018 and
ending March 31, 2018, for a total
January 8, 2018 $500,000 (paid) 4,000,000 (issued) payment of US$630,300.
August 17, 2018 $50,000 (paid) -
October 26, 2018 - 6,179,099 (issued)
October 31, 2018 $573,650* 5,000,000 (issued)
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Project History & Existing Infrastructure
▪ 17.1 million tons mined from 1966 to 1975;
produced 33.2 million pounds of cement
copper from the 7.1 million tons placed on
heaps
▪ 60,000 meters of historical drilling in 700
drill holes, mostly defining near-surface
oxide resource Recently upgraded substation close to mine entrance
▪ The drill holes were not assayed for gold,
silver or other base metals such as zinc
▪ Existing power via a 67Kv line starting at a
recently upgraded substation near mine
entrance (7.5km). Power line will need
upgrading to 1.5MW for production
▪ Sufficient groundwater available on site to
support mining operations
Mine entrance gate
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Mine Site
1. 2. 3.
4.
1. Leach pad from former production. 2. Mine site and buildings. 3. Signage at entrance to mine site.
4. Pit panorama: Zonia mine site was pre-stripped in 1967, followed by limited production (7 Mt on leach pads).
10 TSX-V: CDU | www.cardero.comCopper Mineralization
Drill RRC09-27 grading 11.12% Cu over 8.5 feet . Supergene Drill RRC09-27; further oxidation of chalcocite to cuprite,
chalcocite, copper pitch oxide rim, chrysocolla, malachite. copper “pitch” and malachite.
Outcropping mineralization in pit. Drill RRC09-X08 from an interval grading 0.33% copper.
Chrysocolla, azurite and minor remnant sulfides.
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TSX-V: CDU | www.cardero.comMining and Processing ▪ Deposit amenable to conventional truck & shovel mining, heap leaching and SX-EW processing ▪ Soluble copper mineralization allows for low-cost heap-leaching and & SX-EW processing to produce 99.99% pure copper cathode ▪ Extensive metallurgical test-work averages 73% recovery ▪ Low acid consumption of 25 lbs/ton Stage I Solvent Extraction (SX): extraction & upgrade of copper ions from low-grade acidic leachate (liquor) from heap. Stage II Electro-winning (EW): Copper extracted from the electrolyte & deposited onto cathodes 12 TSX-V: CDU | www.cardero.com
Phase I Permitting Status Phase I permitting, restricted to private land, has reduced permitting requirements compared to an application on public lands. Main permits required: ▪ Aquifer Protection Permit – previous application submitted in 2012 and renewed application will benefit from comments made during review ▪ Water Quality Certification (Section 401) ▪ Air Quality Permit ▪ Pollutant Discharge Elimination System ▪ Dredge and Fill permit (Section 404) ▪ Landfill / Solid Waste Disposal Retaining dam & pond with sump pump, French Gulch looking north ▪ Dam Safety permit ▪ Surface Water Appropriation Permit ▪ Reclamation Plan 13 TSX-V: CDU | www.cardero.com
Exploration – New Porphyry Cu Target
▪ Extensive 150 metre spaced
rock sample grid generated a
large, coherent anomaly
northeast of drill-defined
mineralization
▪ Defined by coincident elevated
Mo, Cu & Au, with depressed
Mn and Zn: classic porphyry Cu
footprint
▪ New target measures 1500 X
2000 metres and appears to be
“sister” deposit
▪ Same host rock as main deposit
(quartz monzonite porphyry), but
less foliated
▪ Permit applications filed for a
5000 metre programme on both
BLM and Arizona state land
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TSX-V: CDU | www.cardero.comExploration – New Porphyry Cu Target
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TSX-V: CDU | www.cardero.comExploration – IP Data Supports Cu Oxide Target
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TSX-V: CDU | www.cardero.comExploration – IP Survey Indicates NE Extension
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TSX-V: CDU | www.cardero.comSulphide Mineralization: Evaluating Gold Credits
• Historical drill samples at
Zonia have only been
analyzed for copper as almost
all holes terminate within the
upper oxidized zone. Only
the most recent drill
programmes were deep
enough to intersect primary
sulphides, with several drill
holes extending below the
copper-oxide resource and
intersecting underlying
copper-sulphide
mineralization.
• Cardero decided to test the
idea that the underlying
sulphide mineralization had
potential to host significant
gold grades. Eleven drill
samples from storage were
selected across a range of
copper grades so that a good
Au to Cu grade ratio curve
could be established. All
samples returned significant
gold values, with an average
Au:Cu ratio of 0.44:1.
TSX-V: CDU 18Grades from select sulphide mineralization
underlying the Zonia copper-oxide resource
Copper
From To Width Gold Total
Drill Hole Equivalent
(ft) (ft) (ft) (g/t) Copper (%)
(%)*
RRC-10-CC 580 585 5 0.584 0.68 1.21
RRC-10-EE 365 370 5 0.258 0.70 0.94
RRC-10-EE 395 400 5 0.638 1.09 1.66
RRC-10-EE 570 575 5 0.174 0.39 0.55
*Copper Equivalent
RRC-10-HH 620 625 5 0.116 0.34 0.45 calculations use metal
RRC-10-21 787 794.5 7.5 0.176 0.32 0.50 prices assumptions of
$2.20/lb for copper,
RRC-10-22 851 860 9 0.084 0.33 0.43 $1200/oz for gold, and
RRC-10-35 505 510 5 0.035 0.29 0.34 $15/oz for silver. Copper
equivalent calculations
RRC-10-28 520 525 5 0.117 0.40 0.52 reflect gross metal
RRC-10-26 300 305 5 0.055 0.30 0.36 content and have not
been adjusted for
RRC-10-J1 410 415 5 0.048 0.33 0.39 metallurgical recoveries
There are approximately 855 sample intervals underlying the existing copper-oxide resource that have
been analyzed for copper, and which could now be analyzed for gold, allowing the Company to further
calculate copper equivalent grades for the sulphide mineralization. Ultimately though, additional
drilling is needed to outline the extent and grade of sulphide mineralization.
TSX-V: CDU 19Future Development
▪ Cardero intends to drill test the Northeast Anomaly (18 holes, 5000m) permits from the BLM and the state of
Arizona can be obtained within 60-90 days; refundable reclamation bonds would be required. Success at this
new target would add significant upside to the project.
▪ Additional work to be performed on the potential gold content in the sulphide target.
▪ Prepare for Prefeasibility level studies to further advance the project towards production. This includes a
programme of geotechnical and condemnation drilling , as well as infill drilling to convert Measured, Indicated
and Inferred resources to reserves, and also potentially expand the deposit to the northeast.
▪ Continue to advance environmental work and permitting for the mine plan. Some of the necessary baseline
work and permit applications have already been completed.
▪ For the first phase of development, as described in the PEA, a mine plan constrained to private land will offer
the easiest permitting route for the project.
▪ Cardero will also review potential projects within the copper space and look to potentially add projects of merit
in the future.
20 TSX-V: CDU | www.cardero.comMove Forward Project Schedule
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr 11 Yr 12 Yr 13 Yr 14 Yr 15
Prelininary Economic Assessment
Drill Inferred Resources and NE Zone
Phase I Metallurgical Testing
Private Bankable Feasibility Study*
Land
Phase 1 Permitting^
Finance & Construction
Phase 1 Production
Drill Resource Expansion
Phase II Feasibility Study
Phase II
Public Land Phase II Permitting**
Construct Expansion
Phase II Production^^
* Hypothetical, dependent on positive results of the future PEA; Phase I Bankable Feasibility will maximize the rate of
production attainable while limiting facilities to private land
^ Phase I permitting is estimated at 2.5 years.
** Phase II permitting involves expansion onto public land and as such the permitting time is less well constrained. It is estimated
at 4 to 7 years, with 7.5 years allowed for in the project schedule.
^^ Phase II production time is unknown and additional life of mine is for illustrative purposes only.
The company will need to raise additional funds in order to move the Zonia project forward
and there can be no assurance that it will be successful in doing so. If the Company is not
successful in raising funds, it may be forced to curtail or cease operations.
21 TSX-V: CDU | www.cardero.comCardero Management
Stuart R. Ross, CEO and President John Drobe, Chief Geologist
• Mr. Ross has had a distinguished career as a senior officer • John is a geologist with over 30 years geoscience experience,
and director of several public companies, including specializing in porphyry copper-gold, epithermal and skarn
companies listed on the NASDAQ and TSX Venture deposits throughout Latin America. He graduated with
exchanges. B.Sc. and M.Sc., both in geology. Previously John held the
• His sector experience includes mining, beverage position of Chief Geologist for Corriente Resources and was
production and distribution, medical services, gaming responsible for all aspects of exploration and resource
and merchant banking, including 17 years as a senior definition at the company's Mirador, Panantza, and San
officer and director of Clearly Canadian Beverage Corp Carlos porphyry copper deposits. Following the sale of
(1986 to 2003). Corriente in 2010, John was the Vice President Exploration
• Most recently, Stuart was President and CEO of El Tigre for Dorato Resources and most recently Chief Operating
Silver Corporation, a TSX Venture listed silver exploration Officer for Indico Resources in charge of developing the
company (2007 to 2015). Irmin copper oxide deposit. John joined Cardero in 2015 as a
• He supervised the exploration and engineering related to result of the Zonia acquisition and serves as the Qualified
that company from an early exploration project up to the Person, as defined by National Instrument 43-101. John also
production of a NI 43-101 Feasibility Report and Reserve serves as an exploration manager and qualified person for
calculation. Wealth Minerals.
Sead Hamzagic, CFO Marla Ritchie, Corporate Secretary
• Mr. Hamazagic is a Chartered Professional Accountant • Marla brings over 25 years' experience in public markets
with 34 years of public practice experience and financial working as an Administrator and Corporate Secretary
management experience. He has been, and continues to specializing in resource based exploration companies to the
serve as, a CFO for several TSX-V and private companies, Company. Since 2001, she has been the Corporate Secretary
and is well-versed in reporting requirements for public for Cardero Resource Corp. Between 1992 -- 2003, Marla
companies. worked for Ascot Resources Ltd, Brett Resources Inc., Golden
Band Resources Inc., Hyder Gold Inc., Leicester Diamond
Mines Ltd., Loki Gold Corporation, Oliver Gold Corporation
and Solomon Resources Limited. She is also currently the
corporate secretary for Corvus Gold Inc., Dorato Resources
Inc., International Tower Hill Mines Ltd. and Wealth Minerals
Ltd.
22 TSX-V: CDU | www.cardero.comDirectors
Robert van Doorn, Director
• Mr. van Doorn is a mining engineer with over 50 years in mining and mining finance. Recently he was
Chairman, President & CEO of Mundoro Mining Inc. (a public company developing the Maoling Gold
project in China), Executive Vice President of Business Development for Rio Narcea Gold Mines S.L. (a
public company with projects in Spain and Mauritania), and Executive Vice President of Golden China
Resources Corporation (a joint venture with Kingsway Capital, a Hong Kong merchant bank, involved
in Chinese mining investments). His career prior to 2002 includes positions as Senior Mining Analyst
at Loewen, Ondaatje, McCutcheon, as Global Gold Analyst at Morgan Stanley and as Business
Development Manager at Royal Dutch Shell.
• In a distinguished career, Mr. Van Doorn's achievements include investment recommendations and
financing of successful exploration companies such as Great Basin Gold, Pangea Minerals Ltd., Platexco
Inc., Argentina Gold and Arequipa, whose discoveries have been developed into major mines. At Rio
Narcea Mr Van Doorn was instrumental in the acquisition of the Tasiast project in Mauritania.
• Mr. Van Doorn is currently non-executive Chairman of Tri Metals Mining and was previously director
of Romarco Minerals, Leydenburg Platinum, Hana Mining, Golden China and Mundoro Mining.
Robert Kopple, Director
• Mr. Robert Kopple is an experienced investor, businessman and lawyer. He is involved in a broad range
of corporate financing activities with public companies. Mr. Kopple is an experienced lawyer and a
senior partner in a law firm based in Los Angeles specializing in estate planning, tax law and business
transactions. He is an experienced investor with diverse interests in real estate and in a number of
operating companies in mining, health care and technology. Mr. Kopple is a significant investor in
Cardero Resource Corp.
TSX-V: CDU 23Directors
Dr. Deepak Malhotra, Director
• Dr. Deepak Malhotra has a Ph.D. in Mineral Economics (1978) and M.S., Metallurgical Engineering (1973) from
Colorado School of Mines and B.S., Metallurgical Engineering (1970) from Indian Institute of Technology.
• Dr. Malhotra with over 45 years of mining industry experience is a world renowned processing expert. He
provides expertise in Process Design, Process Development, Plant Auditing and Troubleshooting and Capital
and Operating Cost Estimates. He has utilized his education in Mineral Engineering and Mineral Economics
coupled with his industrial experience in metallic/nonmetallic minerals and precious metals to find innovative
solutions to mineral related problems. He holds four patents and has published over 80 articles and edited
several books.
• After working for AMAX Inc. for 17 years, Dr. Malhotra started his own metallurgical testing and consulting
company in 1990. The clients include World Bank/IFC, international financial institutions, mining companies
and Governments. He has worked with mining organizations worldwide (from Kazakhstan to Chile and
Canada to India).
• Dr. Malhotra's process work had led to commercialization of about 15 plants worldwide with capital ranging
from $50 MM to $750 MM. He periodically teaches graduate course titled "How to Prepare Bankable Feasibility
Studies and Short Course titled "Plant Auditing for Improved Metallurgical Performance", Operator Training
Courses and Industrial Mineral Project Evaluation Short Course. He is a Registered Member of Society of
Mining Engineers, Member of Canadian Institute of Mining and Metallurgical Engineering and QP for the
Canadian Stock Exchange. He has been awarded Gaudin award and Arthur C. Daman Lifetime Achievement
Award by the Society of Mining and Metallurgy and Exploration Engineers. Dr. Malhotra is currently a director
of Canarc Resources, Blackrock Gold and Resource Development Inc.
TSX-V: CDU 24Directors
Keith Henderson, Director
• Mr. Henderson is a mining industry executive with 20 years' experience throughout Africa, Europe, and North
and South America. He was educated in Europe, graduating with B.Sc. (Hons) and M.Sc. in geology and has
extensive experience in multiple mineral deposit types and commodities. After several years in consulting roles,
Mr. Henderson worked with Anglo American Exploration in Europe and North America, leading a number of
exploration projects and ultimately he was project manager for Anglo Coal as the company made its first entry
into Canada. In 2007, Mr. Henderson joined Cardero Resource Corp. as Executive Vice-President, where he
played a critical role in advancing the Pampa de Pongo through a positive scoping study and ultimate sale for
US$100 million cash. Mr. Henderson is currently a director at Desert Star Resources, and Remo Resources.
Henk van Alphen, Director
• Mr. Van Alphen has been in the mining business for over 36 years, first as an exploration drilling contractor,
then as President of Pacific Rim Mining Corp. Mr. Van Alphen laid the foundation for Pacific Rim becoming a
successful South American-based resource company and was instrumental in the company’s entrance into
South America. He has been a director of Cardero Resource Corp. (“Cardero”) since 1999, was the Chief
Executive Officer of Cardero from May 14, 2001 to November 9, 2011, President of Cardero from April 10, 2000 to
June 1, 2011, Managing Director of Cardero from November 9, 2011 to March 19, 2013 and Chief Executive Officer
and President of Cardero again from March 19, 2013 to August 15, 2017. He is currently CEO and a Director of
Wealth Minerals Ltd and is presently also a director of Blackrock Gold Corp., Ethos Gold Corp., Gelum Capital
Ltd. (formerly Jagercor Energy Corp.) and Centenera Mining Corporation, all public natural resource
companies listed on the TSX Venture Exchange (“TSXV”).
TSX-V: CDU 25Contact Information
STUART ROSS
PRESIDENT & CEO
Cardero Resource Corp.
2300-1177 West Hastings
Street
Vancouver, B.C., V6E 2K3
P 1 604 408 7488 ext 3883
C 1 778 980 7187
sross@cardero.com
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