The Depths of Discovery: Power Nickels Next Big Step

0:08 Okay, everyone, thank you for joining Power NECO's live event. I'm pleased to introduce their CEO, Terry Lynch, and their VP of IR, Duncan Roy. Today, they'll be discussing their latest drill initiatives. I want to encourage you to participate in the live Q&A at the end. So just as a reminder, you can submit the questions in the bottom right-hand side of your screen at any point during the presentation.

0:29 As always, the summit will be recorded and will be available on Six.com to watch afterwards. So without further ado, I'll kick things off to you, Terry. Great. Sounds good. Thanks for having us again. And we just wanted to give you a quick update. Obviously, you announced yesterday that we're back drilling and our quest to be the world's first carbon neutral nickel mine. So just gonna give you a quick sort of recap of what we've done so far, and then we'll talk about where we're going and then take some Q and A and hopefully get out of here fairly quickly in like 30 minutes or so. So without further ado, we're just going to jump ahead a little bit. Obviously, started with the 3.1 million tonnes that we had historically. We followed that up with 8 holes that proved up that resource, so that was a good start.

1:20 And then we started the drill program last fall. And pay attention to these red bodies here. This is the good stuff. That's the higher grade. And you'll see as we come to know the ore body more over time these these maps sort of change but we start off obviously with this banger hole 2209 which was 40 meters of almost 1.6 percent Nickel EQ so that was a great start and then we then we step forward with you know, you can see that the red shape started to broaden out a bit, 10 meters of almost 3%. And then over here, we had almost 16 meters of 1.6. And then a little bit east, we start to have another 50 meters. So those were the initial holes and gave us a pretty good head start.

2:15 And this is what we call the pathway of the River of Nickel. And this is sort of like pulling sort of 10 of our top holes together. It gives you sort of a feel for it. And what you're starting to notice here is looking at the tree line of this, this is the surface as we go down sort of left to right, you know, in the sort of a southeasterly trend. This is what we're seeing. And what's really cool is this is quite a wide section here. This is where most of our tonnage is gonna come from. And it's open at depth and a long strike. So we'll keep that theme as we start to test it going forward. And now let's have a look at this slide. So this is a bit of a busy slide, but hole number 1 here looks like it's in not really the juice area, but that's sort of an optical illusion because this whole trend is coming south and east.

3:15 And so we're feeling that we're gonna pick up the ore body over here and this will turn this into red, and this will become a really good extension for us. So we'll hope to talk more about that perhaps even next week. But yeah, this, this, this, this, so what we're, what we're thinking with these holes is that we're, we're, we're open at depth and a long strike. So to the extent that we can step out here, this one, This hole is almost a 300 meter step out. It's a big one. So that hits, it's going to be very good. And we think these are highly probable holes that will continue to sort of advance your body.

4:01 And who knows how deep it could go. So that's sort of exciting for us from a fundamental perspective and that's what's sort of the main theme of working that what we call NISQ main in terms of just seeing how big that can be. Now, stepping back a sec, just to give you some perspective on the overall ore body. So this is NISQ main down here and we're working deeper. Okay, so, you know, we've got this great, you know, collection of resources up top in around the 200 meter level and goes up to the surface. And then we think it's gonna keep on going down and hopefully improving at depth.

4:47 So that's what our initial focus on the first phase of the fall program and the second half of this year is on. And then the other thing that we're gonna do later in September, late September, early October, is we had this, obviously this amazing breakout hole of almost 8 meters of 1 ounce PGMs, you know, at 60 meters of depth, which is a really a terrific result. So it was in a bit of a marshy area, so it was a winter target. And so we're hoping to be able to drop a rig there in late September, if all goes well, and drill maybe 3 extension holes there to see just how far that carries.

5:37 Obviously with 1 ounce PGMs, that can grow very quickly into something significant. And then the other thing that we're gonna be following up on is we've basically did a bunch of, we did the airborne EM, and we're now using the ambient noise tomography that we talked to you all about. And it's an amazing technology. We're about 6 weeks into it now and we're starting to get some really interesting

6:08 data and it's helping to guide certainly our drill program even now and going forward, it will certainly, what we're noticing or we see is we believe there's sort of 3 major trends

6:27 on NISC main. We're following the primary one right now at depth, but there's a couple of others to follow up on which we'll be doing. And then we'll be tying into some of the airborne EM stuff up in here and towards Wildcat. And then, You know, we're still getting the data back. We haven't got Wildcat yet, covered by the ambient noise tomography, but it will be done shortly. That's being, I think it starts tomorrow. And this section just has come in, so we're just starting to analyze that now. But what we're seeing is super exciting. So we're very stoked about what we're seeing, with the exploration geoscience program, like the ambient noise and the downhole EM and the airborne EM.

7:19 And now of course we're keen, we're back out drilling and the truth arbiter, the drill is turning. And so we finished hole 1 yesterday at 525 meters which was our target. And we're moving on to hole 2. Just stepping back just to, yeah, so hole 2 would be,

7:47 There's hole 2. So hole 1 is there, hole 2 is here. So we're assuming we're gonna get some more of these red spots as we move down at depth. So that's the initial thrust of our objectives.

8:03 And yeah, I mean, that's the basics. So, you know, I'm happy to take some questions from the audience in case there's Any thoughts out there that we could answer some questions on fairly quickly? And we can get into it from however you'd like to drive. So we'll turn it back over to you, my friend. Sounds good, Terry. Thank you. You can come back to full screen if you'd like. We did have some pre-submitted questions, so I'll start with those. Yep. In regards to the first hole of the campaign, it looks like you sort of went deeper to start. Why did you and the team decide to drill at depth for the beginning of this campaign?

8:50 We basically looked at all the data and obviously the scientific team, and they just felt that the ore body was open at depth and a long strike, and that the right

9:05 practical mining approach is to keep on extending at depth and this is catching up to this sort of a south easterly trend and keep on stepping it out. Ken Williamson, who's joined as VP of Exploration, he was the first guy to model this deposit in 3D, and He's had a very good feel for it, as have the GeoVector guys. The team has really worked fantastic together. They feel that they've got a pretty good idea of the pitch and the down dip of the ore body, and we've been able to target it. So that's why they chose to go with this big step out hole and it looks like it's in the yellow, which is not theoretically the good stuff. The red, as a color map goes is what you're

10:03 looking for. But we expect that, you know, just as we've turned a lot of this map red, we're gonna turn that yellow into red as well. Great, and another individual is wondering how that ambient noise tomography is helping with the campaign? Yeah, you know, it's amazing stuff. I mean, you know, the team, I mean, this is all of our first times working with this new technology. And so we're learning, you know, what it does well and, you know, some of its, you know, weak points, you know, because everything's got its pluses and its minuses. But we've been very impressed with what we've been able to learn. And it's really been interesting, like where we've gone back and it really looks like you're looking at a subsurface view of our mountain range, you know.

10:56 And this ultramarfic sequence, which is where

11:03 the ore body is lying, it basically looks like a mountain range. It's a big-ass mountain range. It's not just like a thin line. It's got width and depth to it.

11:20 But also there's valleys. And we were able to sort of see in some of our misses where we thought, wow, you thought that would have been good. And then, bang, and then we saw with the fleet, yep, that was a valley that just dropped off. And then it picks up sort of across the valley, and there's your ultramagnetic unit again, and there's your ore body again. So It's pretty neat to be able to see it in 3D. And I think it's really helping the guys visualize, the scientific team visualize how the ore body's turning. And in some cases, sometimes it folds in on itself. Mother Earth is a very tricky lady. She doesn't give up her body very easily.

12:09 So it's really been good to have these tools to help us, guide us to catch her sleight of hand and where she shifts things. So it's been very productive. So yeah, we're super happy with that program. And probably when it's all said and done and we have a thorough analysis of it, it'll probably be mid-September or so, then we'll probably do a fleet talk where we'll actually show people what we're seeing and what it means. And I think that'll be pretty compelling, if you're a mining investor at least, to look at. Great. Neil has a couple of questions here.

12:54 He's wondering how long is the strike and how many meters of overburden is there? Yeah, you know, I mean, it at this point, it probably is like a kilometer or so. And how much overburden it it's it goes, it starts, you know, like up here, if you look at this screen. Are we on full screen still or no? Yeah, we are. Yeah, okay. So, this is the surface, so there's no overburden there. And this is about like where my cursor is now that little red bit there That's about 70 meters or so 80 meters.

13:41 So it's not a lot to get down into this So it's it's it's pretty even that's one of the great things about NISK, it's a shallow deposit, at least for the first one. You know, we're expecting, I mean, down here, hole 3, hole 1 was 525 meters, but with the incline, probably true depth is maybe 425 or something like that you know 400 and 2 will be a little bit deeper 3 a bit deeper 7 a bit deeper so we're obviously pushing pushing the envelope down here thank you An individual is just looking for more clarities on holes number 1 and 212. He's wondering where they're located. He saw a sketch yesterday or she saw a sketch yesterday indicating that you're drilling a ways south of Maine. Is that correct?

14:34 Yeah, I mean, the initial holes are really sort of in the, what we call NISQ Maine, but they're South and East and deeper. So we're testing the extension of the ore body to the South and East at deeper levels. The 9, 10, 11, 12 over here is following up on some EM targets that were identified. So, they're not currently on our screen. But we've got some theories as to what we might find over there. Great and Konstantin wants some wants to know given the FPX Nickel news lately they're wondering about the First Nations and the restrictions on the NISP project is there any risk there And is it generally easy to permit?

15:37 You know, we're, you know, with good relationships with the James Bay Cree, you know, all of our drillers have stayed every night in their resort hotels that they have up there and were not anticipating anything but spirit of cooperation. The Quebec government's done quite a different job of working with the Aboriginal First Nations than the other provinces. And to their credit, they've basically cut them in on the deal, and they've shown them how they can, you know, profit and benefit as their communities can benefit by keeping high-paying jobs at home and getting their youth and their community well-employed at very high-paying jobs.

16:30 So, and all within the framework of still being, obviously a responsible environmental citizen. There's, I think, 4 mines permitted within about, you know, 100 clicks radius of us. So, we'll still have to go through our process of course, but we're not expecting any significant community resistance to it. We'll do the right things and we think they'll do the right things and everyone will mutually benefit. Okay, Terry, that's all the questions we have submitted today and I Am gonna respect the audience's time in your time as well and we can end it here But thank you all for taking the time out of your day to attend the event If you did come in a little late, the recording will be available on 6.com in the following days, so look out for that.

17:24 Terry, do you want to say any last words before we close off today? Yeah, you know what, I mean the only thing I would say is that we think it's going to be a good fall. This chart is a chart I always come back to, and I think as an investor it's a great chart for you to look at. And it basically looks at power nickel in comparison with other high-grade nickel sulfide mines around the world. So we don't see ourselves as FPX or Gigametals or Canonickel, and I'm not disparaging those companies that are fine companies. Different animals, they're chasing much lower grade, much bigger deposits, much more capex, you know, different animal. This, you know, so when we look and we sort of say, well, these are the nickel sulfide mines around the world that basically the market believes will become mines.

18:19 And they range in sort of like, you know, sort of the 100 million to 600 million in value. And we're at 25 or so, or 30 or something, I don't know. It's pretty cheap. And yet you look at, you know, what we're at, we're about to announce our 43-101 in October. We think that'll show that we're gonna be commercial for sure, that's why we're able to do the CVMR deal that we announced last week, where they're actually doing, we're doing a feasibility study on this right now. So in our mind, this is gonna become a mine. And so our valuation at some point is gonna take a major leap forward. So if you're a shareholder of Power Nickel, hold on to those babies. And if you're not a shareholder, maybe you better find a way to get some, because I think if you're looking for a risk return, you know, investment in the mining sector, hard to find 1 better than Power Nickel.

19:20 Now, I'm long and therefore recommend and we have to take that into consideration. But yeah, I think it's a tremendous value proposition and a great time. You know, drilling is when good things can happen and we're drilling now. So anyway, we'll leave those thoughts with you and we'll look forward to keeping you posted as we move along with the power nickel, you know, quest to become the Canada's next nickel mine.