Imperial Metals Corporation (III) Earnings Call Transcript & Summary

Thank you, Darb. The next item of business is to approve the amended and restated share purchase plan. As Chair, I propose the following motion: that the amended and restated share purchase plan be approved, the wording of such resolution is set out on Page 27 of the Management Information Circular dated March 30, 2023. I will now again pause a moment for questions. Darb, were there any questions?

No, not at this time.

Thank you. There being no questions, I declare the polls now closed for the approval of all matters before this meeting. Based on the interim scrutineer's report, I've been advised by the scrutineer that the majority of the proxies deposited for the meeting have been voted in favor of each of the foregoing resolutions at the meeting. I would ask that the scrutineer compile the final report regarding the results of voting on all business matters and results will be published by the company on SEDAR and by news release. I direct that the results be included with the minutes of this meeting. Imperial knows of no other matter to properly come before the meeting, therefore, as Chair, I propose the following motion: that the meeting be terminated. I will now pause one last time for questions. Darb, were there any questions?

No, not at this time.

Thank you. There being no questions received, I declare the motion carried. Thank you all for your attendance at the formal part of this meeting. I now turn the meeting over to Brian Kynoch for his presentation.

Thanks, Pierre. Good afternoon, and thank you for attending our Annual General Meeting. I'll now give a presentation on giving an update on our major projects with a focus on Mount Polley. And then after the presentation, if you have some questions, we'll try and answer them. Start off with saying that some of the comments I may make could contain forward-looking statements, which are uncertain, and actual results may differ from those expressed today. And we can go further through this forward-looking information notes. First slide I've got here has a photo of the Springer pit in 2022 and one in 2023. As you can see, mining has progressed to the point where the Cariboo and Springer pits are effectively merged into one in the Cariboo ramp is providing access to the Springer pit. The water balance at sites improved and the water that you can see in the Cariboo Springer pits in the 2022 photo has been removed. And in the 2023 photo, you can see that the pit bottom in the Springer is actually below the surface of the tailings right than the central part of the photo. And the saddle between the 2 pits has now been excavated, and we're down into the kind of the heart of Phase 4 pit ore. One other item to note on this slide, I know they're relatively small, but if you look in the center of the 2023 photo, you could see a causeway on top of the tailings that swings around the western edge of the Springer pit and then out into the middle of the Springer pit. We drilled 3 wells in that causeway through the tailings and down into the blasted rock below that was left on the bottom of Phase 3. We installed 2 pumps and use the third well to measure drawdown. And later, you'll see in the slides, that's been very effective at dewatering the Springer pit. This is a plan view of the 2 pits before the mine was restarted. And in the central part of the photo, you can see clearly the saddle has now gone between the 2 pits. And that saddle excavation provided the majority of the material that was treated in 2022, with more oxidized the lower grades than the ore beneath. And that's why later, you'll see recoveries have been improving and grade's been improving because now we're -- as I said, we're down in the core of the ore body. And on this next slide, we've got a cross-section through the -- if you look at that on the plan there, you'll see Section 3,300 North. So we're going to look at a section looking north next. And on this slide, you can see the saddles removed now we're down -- it says 964 on the slide there that where we're in the Phase 4 pit, but we're actually down to 952 now. And you can see that we're down below the surface of the tailings on the right-hand side there. And now we'll -- being down there, it's dry and we'll start moving the tailings going to the left-hand side of that photo. And later, you're going to see another section in the vicinity showing the drilling that we just completed. So this next photo is the water tailings ready to move. So on the left-hand side of the photo, you see that dry sand there. That's the tailings that were deposited in the pit in 2015. They're dry sandy tailings, we've started the mine that we can just mine right across it so far. We'll see what happens as we get further across because it's probably going to be a little bit finer. This is really close to the point where we discharge the tailings. It'll probably get finer as we go across. The permitting to drive -- we're going to -- and you'll see on the next slide, we're dry stacking the tailings. We're putting the tailings up on top of the South rock dump area. And that permitting that took a little bit longer than we wanted, but it just didn't make any sense to haul tailings down that are dry and capability moved and then put them back in a tailings pond. So you'll see on the next slide what we're doing with these dry tailings. So here's actually starting to dry stack the tailings in a cell on top of the -- we call it the third dump, the Southeast rock disposal area. And you can see there probably 785 dumping a load of the dry tailing into cells, some created cells. Tailings are so dry. I think they stack anyway. Anyway, we create cells to make sure we contain the tailing. This slide is actually a slide that I presented in the 2021 AGM. It's from the 2020 exploration. When we drilled 1 hole in the Springer pit, you'll see it going across there. It's highlighted SD-20-162. And you can also see if you can get any closer, this is -- these are on our website. If you look in close, it has long interval at good grade. And it was particularly drilled to go, you'll see that one really deep vertical hole. It would go down there and have another check at what's happening at depth in the Springer mineralization. And the other thing you can note on the slide there is you can see area called the shadow, a circle there with an ellipse the shadow of the Polley fault exploration target. So between the 2 pits, the Polley fault separates the 2 zones and kind of underneath the Polley fault, historically, it was undrilled, relatively undrilled especially at depth, really near surface that was drilled, but at depth, it was never drilled. And I took a quote out of what I said in my 2021 that says, success here may add to open pit mineable tonnes. And when we mine out the saddle, we will drill it. Well, it took a few years that the saddle is finally gone and we've now started to drill here and testing the Springer mineralization, both at depth and to the east towards the Cariboo pit. And over the next couple of slides, I'll show you some of the results of the latest drill program. So this one is a plan view and it shows the 5 holes we recently completed. They all hit significant intervals of mineralization. And actually, today, I talked to Jim tomorrow, we should be starting a drill program to follow up on the excellent results we got in the first phase. And so the next slide is going to be a section through 3320 North, and it's the furthest north one on this slide, and it has the trace of SD-23-167 on it. So here's the Section 3320. And as I said, it's the furthest north of the section of the current drilling. And we hit 162 meters of 0.5% copper and 0.52 grams per tonne gold from 30 meters. So good grades, close to surface. This exceeded our expectations. It's probably the second best interval in the Springer database between the 800 and 1,000-meter elevation. Elevation you can see on the right-hand side of the slide. We didn't expect to get this good of material there. And then you can also see on the slide that the Cariboo pit has kind of effectively pre-script the Eastern side of an extended for your pit. So in this area, we find more ore here. This is a really good place to find it because it should be accessible at relatively low strip ratio. And this is the area, this northern part. This section and the section South where the next 5 poles, we're going to drill, we're going to drill them all up this end, relatively shallow. You can see this one didn't hit as much mineralization at depth. We're going to go to the relatively shallow area because more good results here can have an impact on our mine plan sooner because of it. Because it's kind of a shallower than some of the stuff you're going to see on the next slide. So this is a section 60 meters south of the one we were just looking at. And it also had to get intercept 159 meters at 0.46 copper and 0.57 grams per tonne gold in SD-23-166. Now this mineralized interval starts a little bit deeper. It's about 150 meters down, but it does, again, confirm that the mineralization continues towards the east -- to the east towards the Polley fault on this section. And again, you also see this is right across -- this is right in the saddle area, so it's right across from the Cariboo pit. And it's kind of like it's been pre-stripped. Now this last section I'm going to show you is the southernmost section 3160. It's got 2 drill holes on it, 163 and 165. And you can see both of these hit really long intervals of mineralization east towards the Polley fault and extending the mineralization against the depth, well below the base of the pit. And these 3 flights drilling in this area, the area between the Springer and Cariboo pit. There's a really good chance that -- well, continued drilling here could substantially increase the resource at Mount Polley, and especially the stuff to the north, the shallower, we could probably -- for sure, we're going to change our mine plan if we intersect more stuff there. A final slide on Mount Polley. A little bit about the ramp-up compare in the fourth quarter of 2022 for the first quarter of 2023. I think one of the things I'd really like to highlight, and I mentioned before, if you look at copper recovery, 81% versus 67% much higher again, that we're now deeper into that Phase 4 ore. We're not mining the stuff that was more highly oxidized stuff up in that saddle zone. And as I said, in particular with copper, this ore that we were treating in our formulas, we would have only predicted a 77% recovery instead of an 81%. In the plant, we made 1 major improvement to the plant. We've installed a new filter press. It's been installed and being commissioned. So upgrading the plant. We continue to have some problems with electrical here, but we -- the plant is running and we're addressing these problems in this stage manner. And once we have them worked out, we'll push our way. I'm going to ask questions at the end. We'll push our way to reach the maximum historic throughput of about 20,000 tonnes a day. As with all other mines and seemingly all other business activity, finding trained people to fill all the positions at Mount Polley is difficult. And we're working through this by relying more on contractors than we have in the past, and by focusing efforts on training people new to mining. I'll move to some slides from Red Chris. So the highlight at Red Chris has been the continued exploration success at the East Ridge, with this drilling continuing to confirm the continuity and to expand the footprint of the mineralization in the East Ridge. This follow-up drilling that Newcrest is undertaking is on basically 100 x 100-meter grid to help them understand the mineralization, get the geotechnical and geometallurgical information they need and to extend the higher-grade mineralization. And the drilling to date is tested the quarter about a kilometer long, 450 meters wide and for the vertical extent of a kilometer. And within this larger zone, there are areas of higher grade mineralization. And in parts of it, the mineralization remains open at depth. And so on the next section, I'm going to show you a slide or on the next slide, I'm in the solid section. In the upper right, there's a dashed section line, the yellow dot section line. So it's going to be along that section through the East Ridge. There we are. So this is a section through the East Ridge. And a couple of things I'd like to note is you can see that mineralization is near vertical in orientation. So that is a good geometry for casing. And secondly, I know the print is fine there, but if you can go to our website, you'll see there are high grades. And one of the examples in kind of the middle of that -- upper middle of that set of drilling full RC 750 had 250 meters of 1 gram a tonne gold and 1.1% copper. So excellent grade. So this drilling has resulted in an enhanced exploration target, is now up to the latest estimate that Newcrest has done between 400 million tonnes at 0.49% copper and 0.42 grams per tonne gold and 500 million at 0.47 and 0.39 grams per tonne gold. This is a significant increase from the initial exploration target. And to be clear, this target that's been described, is outside of the current resource estimate for Red Chris. So the potential here of the exploration target is great. But it is conceptual in nature, and they still need to do a little bit drilling -- more drilling to complete the estimate of the mineral resource. And they expect to have an initial resource for the East Ridge before the end of the year. And you can see it now, this is -- this slide, I missed a part of Newcrest slide. So this East Ridge, it looks like the second. It will be better grade than the macro Block 2. So in the East Ridge, they have 3 different blocks that they're going to mine in the block cave. This is -- this area is only second to the first macro block. So they might resequence how they mine this before it is actually mined or looking at maybe East Ridge should be second. On the next slide, I'll go a long section through the Red Chris deposit. You can see the East Ridge out on the right-hand side, the East zone side, it's in the main zone, but you also see 3 circles on there in the main zone and 2 in the Gully Zone. So both -- all 3 of those are drill targets that should be followed up with more drilling. In addition to this, they've -- by applying the knowledge they've gained from looking at the Red Chris, they've identified 7 high priority porphyry copper gold targets across the huge claim group that is now held by the joint venture and a program of geological mapping and sampling and some drilling is planned to investigate these targets. On this next slide, the exploration ramp. You called in June 2021, it's now advanced more than 3,000 meters. In addition to that, the first ventilation raise has been completed and is getting close to be being fans all installed and operational. On this slide, it's an oblique section, and it shows the proximity of -- they've actually generated some conceptual cave shapes in the East Ridge. And you'll see how close it is to the development being completed to for the East Zone cave. They were right in the same area. If you -- I mentioned the first vent raises then. So if you look where it says East zone decline in construction, approximately 3 kilometers that vertical line through the E and the C, that's the first vent raise, and it's been completed. Now they're working on the feasibility study, and they expect that to be completed in the back half of this year. And as part of that study, they're looking at opportunities to try and maybe bring some high-grade ore forward to help ore quicker payback and maybe come in a little bit higher than they are planning now in the East zone so that we can maybe spend a little bit of money and get higher grades to the mill sooner. On this next slide, this is the results of the prefeasibility study -- outline of the results of the prefeasibility study. And based on this, we should have and easily or a financeable project when the feasibility study is delivered. We'll have a cost estimate and then we'll be in a position to finance our share of the cost to complete the development of the block cave at Red Chris. And we'll look at kind of all the possible ways of financing and pick the one that's going to work best for us. And then one slide on Huckleberry. So we've spent about 2 years doing what I kind of think of as basic geology starting kind of from the ground up trying to look at our entire claim package. So in 2021, we completed a TEM survey, an aerial survey. And it's the first survey that we've done on this property that covers the entire property, and it gave us magnetic susceptibility, conductivity. It gave us some -- for the first time, we have some information on the entire property. Then we spent last summer ground proofing that. So we collected rock samples. We prospected. We did some work on the geochemistry and there are these 4 target areas here. And one particular I'd like to highlight is the one in the kind of center there called Whiting Creek. So it's just to the west of some historic drilling called the Creek Zone. It was an anomaly -- you'll see there's -- within that box, there's 2 geophysical anomalies that TEM survey came up with. It also, when we went in there, got some copper in rock samples collected during the ground truthing. We also did, as I said, did some geochemistry. So it's an area that shows an increase in [indiscernible], which is a good thing for porphyry copper deposits or a good indicator of such. And so this is a natural place to step up from the Creek zone and we plan to conduct a drilling program here. So I think it's about 8 kilometers. The -- if you look at the bottom, where it says main zone and again, there's a target there that's outlined by the geophysics. That's where the existing Huckleberry mine is. I think we're about 8 kilometers away. So in proximity to an existing facility, I think we have an excellent target. And then to close, copper is -- a lot of copper is going to be needed, is going to be needed in that amount to decarbonize the world's economies. And I think we're in a great position to benefit from this transition with our copper assets, including 30% of Red Chris, the 100% of Mount Polley, 100% of Huckleberry and several other copper prospects that we have in our inventory. And with that, I'll close and if people have questions, we'll try to answer.

So we have a question, how much of this recent drilling bottom tenure. So maybe if I can go back. Okay. We'll look at the furthest north one first. Hard for me to see that in. Yes. Okay. Got it. So this is a 3320 section. And on this one, you can see that the good intercepts in 67 are higher up near the top, and we probably went -- let's see, 150 meters with only sporadic intersections of mineralization. So in this one, we probably -- it didn't bottom an ore. If you go to the next one. So I've got here 3260. So this one, it's a little bit less clear that you maybe shouldn't drill a little bit deeper. There's a little bit more mineralization between beneath the good intercept. But again, this one looks like it's bottomed an ore. It's the next phase of the further south ones where you can see you probably could have drilled that deeper. But we're already -- I think those holes are about 500 meters. We're already to a substantial depth and I don't know. This mineralization -- if we find a way to get down there, it's probably tens of years, not single digits of years to get there. So we can follow that up later. Any more questions? Well, thanks so much for attending. We appreciate it. Have a great day.

This concludes today's meeting. Thank you all for attending. Everyone, have a great day. You may now disconnect.

Goodbye.