Rio2 Limited (RIO:CA) Presents at Mining Forum Europe 2026 Transcript

2026-04-14 13:11:47 ET

Rio2 Limited (RIO:CA) Mining Forum Europe 2026 April 14, 2026 10:10 AM EDT

Company Participants

Andrew Cox - President, CEO & Non-Independent Director

Presentation

Unknown Executive ...

[Audio Gap] and from Andrew Cox, President and CEO of Rio2.

Andrew Cox
President, CEO & Non-Independent Director

Okay. Good afternoon, everyone. Thank you to the Mining Forum for giving us this opportunity to present Rio2 and our projects.

Just as a brief introduction, Rio2 is a Canadian listed junior that's currently in a transition from developer to producers. So that comes via two opportunities, one being the conversion of Fenix Gold from construction into operation that happened in January this year. And in January this year, we also acquired an underground copper mine producing asset in Peru. So we're now a developer, and you probably see that reflected in our share price graph. This is just a photo of Fenix South, where we're actually mining today in the Fenix Gold project.

Reader Advisory that you should probably read.

So our company is -- whilst we're listed in Canada, we're probably not a typical company because our head office is based in Lima, Peru. We have a small finance office in Vancouver, people -- staff working from home, but our technical office or our technical managers staff are based in Lima, and we're probably a very Latin-based company in that respect. And that's probably a strength for us to be operating in South America. Myself and Alex Black both live in Lima 20 years now, and we've sort of become Latinos to some degree.

Our operation, our main operation is Fenix Gold in Chile, located in the third region, Atacama. And then recently, the Condestable mine in Peru that's been acquired and is now part of our portfolio.

Just a quick shot of the people in the company. We don't really expect you to want to know who they all are or what they all do. But it's important just to say that except -- with the exception of the people that have come on board from Condestable, 90% of the rest of these people have come from what was the Rio1 company, Rio Alto Mining, which operated in Peru from 2009 through 2015 before it was brought out by Tahoe Resources. So there's a lot of experience, a lot of knowledge. We built and operated two heap leach projects in Peru in that period. And it's the same team, the same people that we've taken to Chile and have executed on the construction of the Fenix Gold project.

So we consider Fenix Gold to be our cornerstone project. It's located in Atacama. City of Copiapó, approximately 160 kilometers by road, 2 hours drive, Asphalted road, [ Tassill ] road to the project. Our nearest neighbor that people might take as a reference point is La Coipa, Kinross' project. And as you can see in the Maricunga belt, there's a whole lot of projects, a lot of gold endowment and projects that are probably being looked at again with the gold price where it is and these projects generally restricted for water. Water is a big issue in the area. And for us, that's one of our challenges to be able to expand our project to its full potential is to resolve the water issue.

So just some facts about the project from the 2023 feasibility study that we did with a $1,650 reserve gold price, the project had 17 years of mine life. This is the Phase 1 operation with 20,000 tonnes per day processed. We are limited at Stage 1 by trucking water. So the projects was a fast track startup.

How do we do that? We truck the water to the site and we generate cash flow while we resolve the problem of how we build a pipeline, how we expand the project to its full potential. And we have 5 million ounces of resources. And the 20,000 tonnes a day, obviously, that's way too smaller mining rate. But we need to earn cash flow, we need to be able to put a desal pipeline into the project. And at 80,000 tonnes a day, that then enables us to produce 300,000 ounces a year for more than 10 years. So that's the biggest challenge we have right now, the biggest value unlock that we're driving for as a company.

As I mentioned, we just finished construction. So we're producing gold since January. And we have a large land package unexplored, which we're not really putting money into exploration outside of the project right now. This year, we have earmarked $10 million for near-mine exploration, mostly at depth.

Section for the geologically inclined people here. This is -- basically, it's an [indiscernible] of volcanos. The sort of vertical structure, as you can see in the colors are volcanic breccia pipes and the mineralization is generally associated with the breccia pipes and to a degree in stock work around in the host rock. So it's a big bulk low-grade oxide gold project. And the thing that you're probably not seeing from here, but the attitude, the highest point in that cross-section or long section rather at Fenix North is close to 5,000 meters and Fenix Central is 4,900 and then Fenix South is closer to 4,800. So it is a high altitude mine, and that does have some challenges.

You can see in the blue -- so the light blue line, that's the reserve 1,500 from the '23 feasibility study. And then the black line under that is the resource shell at $1,800 gold. The exploration program that we're doing is orientated to depth. In the section under Fenix North, we don't have much drilling information now. And when we run the gold at $4,000 or $5,000, so the pit is not pulling down because we haven't got information down below that. So we're targeting deep drilling in this campaign to try and include that in our resources.

Shot of Fenix South, where we're mining today. This is a peak of a hill when we started. So we've had some breaking issues there getting started, getting that area opened up. We're now not tripping over ourselves finally, we've opened up space. We've got drilling happening. We can get great control in front of us and slightly starting to put some water into the mining and deliver the tonnes like we planned to the leach pad.

Some recent photos of the construction of the leach pad to the top left, that's ongoing. To the right is the process plant and the [indiscernible] plant where we're storing water at the moment, water being delivered by trucks currently 1,400 cubic meters per day. Photo of a gold pour and then in the bottom right-hand is the exploration drilling and the deep drilling that we're doing.

Condestable, the second project we brought and a lot of people are saying, why copper, why underground? And we're typically known as an open cast heap leach run-of-mine operator, that's what our 3 projects have been. But it was an opportunistic purchase. It was a project that's close to us in Peru, very easy to access from Lima. It generates good cash flow, steady production for the last 10 years, and it's currently producing at 8,400 tonnes per day or roughly 27,000 tonnes of copper equivalent. And if you want to put that into gold terms, because I have to do it in my head, but it's 80,000 ounces roughly equivalent of gold.

So it's -- the Condestable project for us, and it's a running mine. It doesn't need CapEx pumped into it. It doesn't need much support. It's got a very good management team, and we see there's a bolt-on cash flow generator to Fenix to help fund the expansion of the Fenix project.

Just some data, 60 years of production, the copper equivalent, 27,000 again, currently reserves 11 years. So we bought a project with 11 years of reserves in front of it. There is some big expansion potential near term to move from 8,400 tonnes per day to 10,000 and then 12,000 through permitting. That's basically largely completed, very good mining costs, $2.25 per pound. This is for a medium-sized mine. I think that's pretty competitive. And again, a big land package of unexplored hectares that need to be looked at, but we reduced time and budget -- we need to do something.

Some photos of Condestable It's a rare mine in Peru. It's on the coast. It looks out at the coast, low altitude, so a very desirable place to work versus 4,800 meters, for example. Costal views beach houses at the beach, a nice place to work. Photo of the filtration plant. So we're currently -- Condestable is currently moving from wet tailing to dry stack tailings. That is largely advanced to be commissioned in the next month. The electric trucks are currently an ongoing trial with 6 electric trucks, BYD trucks underground. It seems to be going well, reducing cost, reducing emissions, reducing ventilation, et cetera, et cetera, and a photo of underground mining.

So the corporate snapshot. Currently, at today's price, we're roughly worth USD 1.1 billion as a company, share price of $2.80. The cash balance is $93 million, and we have associated with that $87 million of debt, which is related to the Condestable purchase.

Our share price was going very well at the end of last year. It was climbing nicely. The rerate from construction to operation. The acquisition of the Condestable project, which was received very well by the market, pushed us up to $4 and gold came off. Trump invaded Iran and then lots of turbulence, lots of -- you see some of those -- the amounts of shares transacted, some of those days were massive, 15 million, 20 million shares being traded. So it had a big impact and we seem to be recovering and climbing. It's also a list of some of our shareholders, the biggest shareholders -- insider holdings in the company are currently around 7%.

So what are we doing? What are we looking for going forward with Rio2 two assets, but both of them have organic growth potential, and this is what we're basically aiming for as a company. We're ramping up Fenix. This year, 2026, we expect to produce 60,000 to 70,000 ounces. And from 2027 onwards, we get to a flat rate of 20,000 tonnes per day to the leach pad, and that allows us to produce 100,000 ounces for the next 4 or 5 years. We are pushing to release a PFS study on the expansion case at the end of this quarter, currently waiting on 2 costing studies for a desal pipeline from Copiapó to the project. And we need the data for CapEx for OpEx for the time line. And then that will allow us to publish a technical document, which will let the market see what the potential expansion at Fenix looks like in the future.

The drilling that I mentioned, long-deep drilling, which will internally to an updated [ MRE ] statement at the end of the year and making a decision on the pipeline, on the water supplier, we then stat engineering, feasibility studies, permitting, EIA process, and we expect that to take us into like the end of 2028. So ideally, we would be taking a construction decision on the expansion at the end of 2028.

Rough numbers, currently estimated to be $400 million on the pipeline and $150 million CapEx on the project itself with internal expansion. So that ballpark figures, not from the studies, but from the preliminary information we're seeing.

So from 2028 to the end of '28, basically a 2-year construction time frame for the pipeline and the project in parallel. And from, let's say, 2031, we would be ramping up again at Fenix towards 80,000 tonnes per day and 300,000 ounces per year production profile.

In the case of Condestable, it's currently ticking along at 8,400 per day. The mineral reserve resource statement due this quarter, which will basically reflect that we've maintained 10, 11 years of reserve life in front of ourselves. So we've covered depletion in this period. And finally, the approval of the modification to the -- for the 8,400 tonnes per day process or project to 10,000 tonnes per day. So that will be granted in roughly June. We then have environmental permit to expand the project to 10,000. And then on top of that 10,000, additionally, we can ask for a 20% additional production capacity on a short-form permit with the administrative permit. So looking forward, we've got the ability now to take this project to 12,000 tonnes per day throughput.

How do we do that? Okay, we need, obviously, the plant to be upgraded. So we're currently looking at that. We have an engineering construction team from Fenix have finished in Fenix, they come back to Peru and they are getting involved with this project. We estimate a CapEx of around 50 -- sub-$50 million to upgrade the plant to 12,000 tonnes per day. And in parallel, the filter plant that you saw, the dry stack tailings at that deals with the tailings aspect of the expansion. We have something like 100 million tonnes of space permitted in the new modification for tailings, so that's resolved. And the dry stack also resolved the water issue. So the extra water required to go to 12,000 tonnes a day comes from the dry stack filter filtration plant.

We are also allocating $5 million to near mine exploration and Condestable. And what we're looking for there is at the surface, historically, there were 2 open pits above the underground operations. And we see potential there to prove up a resource at surface. It could be millions of tonnes at a grade of 0.5 roughly. It's been left behind historically and today, that's very interesting to us from an open mine perspective to the plant.

The mine is operating at about 0.75 copper currently, [ 0.225 ] gold and silver, which equates to about 1% copper equivalent. And then with that information on the drilling and it may require more drilling, assess options to develop the open pit project in parallel, and that may be part of the 12,000 tonne a day expansion plan or maybe a separate aspect of the project, depending on the resource that we discover.

So that's basically Condestable. This is a video to finish. It's probably a feel good video. It's a human resource shots and people doing stuff. And a bit of color so you can sort of appreciate that what the project look like.

[Presentation]

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