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Stornoway Corporate Presentation December 2015
1. BUILDING QUÉBEC’S FIRST DIAMOND MINE
Corporate Update, December 10th, 2015
Matt Manson Orin Baranowsky
President & CEO Director, Investor Relations
2. 2
Forward-Looking Information
This presentation contains "forward-looking information" within the meaning of Canadian securities legislation. This information and these statements, referred to herein as
“forward-looking statements”, are made as of the date of this presentation and the Corporation does not intend, and does not assume any obligation, to update these
forward-looking statements, except as required by law. These forward-looking statements include, among others, statements with respect to our beliefs, plans, objectives,
expectations, anticipations, estimates and intentions. Although management considers these assumptions to be reasonable based on information currently available to it,
they may prove to be incorrect.
Forward-looking statements relate to future events or future performance and reflect current expectations or beliefs regarding future events and include, but are not limited
to, statements with respect to: (i) the amount of Mineral Resources and exploration targets; (ii) the amount of future production over any period; (iii) assumptions relating to
recovered grade, average ore recovery, internal dilution, mining dilution and other mining parameters set out in the 2011 Feasibility Study or the Optimization Study; (iv)
assumptions relating to gross revenues, operating cash flow and other revenue metrics set out in the 2011 Feasibility Study or the Optimization Study; (v) mine expansion
potential and expected mine life; and (vi) future exploration plans. Any statements that express or involve discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “anticipates”, “plans”,
“projects”, “estimates”, “assumes”, “intends”, “strategy”, “goals”, “objectives”, “schedule” or variations thereof or stating that certain actions, events or results “may”, “could”,
“would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be
forward-looking statements.
Forward-looking statements are made based upon certain assumptions by Stornoway or its consultants and other important factors that, if untrue, could cause the actual
results, performances or achievements of Stornoway to be materially different from future results, performances or achievements expressed or implied by such statements.
Such statements and information are based on numerous assumptions regarding present and future business prospects and strategies and the environment in which
Stornoway will operate in the future, including the price of diamonds, anticipated costs and Stornoway’s ability to achieve its goals, regulatory developments, development
plans, exploration, development and mining activities and commitments. Although management considers its assumptions on such matters to be reasonable based on
information currently available to it, they may prove to be incorrect. Certain important assumptions by Stornoway or its consultants in making forward-looking statements
include, but are not limited to: (i) anticipated geological formations; (ii) Stornoway’s interpretation of the geological drill data collected and its potential impact on stated
Mineral Resources and mine life; (iii) future exploration plans and objectives. Additional risks are described in Stornoway's most recently filed Annual Information Form,
annual and interim MD&A, and other disclosure documents available under the Corporation’s profile at: www.sedar.com.
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections
and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these
forward- looking statements as a number of important risk factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations,
anticipations, estimates, assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the
assumptions and estimates expressed above do not occur, including the assumption in many forward-looking statements that other forward-looking statements will be
correct, but specifically include, without limitation: (i) risks relating to variations in the grade, kimberlite lithologies and country rock content within the material identified as
Mineral Resources from that predicted; (ii) variations in rates of recovery and breakage; (iii) the uncertainty as to whether further exploration of exploration targets will
result in the targets being delineated as Mineral Resources; (iv) uncertainty of results of exploration in areas of potential expansion of resources; (v) changes in
development or mining plans due to changes in other factors or exploration results; and (vi) the additional risks described in Stornoway's most recently filed Annual
Information Form, annual and interim MD&A and Stornoway's anticipation of and success in managing the foregoing risks. Stornoway cautions that the foregoing list of
factors that may affect future results is not exhaustive, and new, unforeseeable risks may arise from time to time.
3. 3
Forward-Looking Information (continued)
Readers are referred to the technical report dated as of February 28th, 2013 entitled “The Renard Diamond Project, Québec, Canada, Feasibility Study Update, NI 43-101
Technical Report, February 28, 2013” in respect of the January 2013 Optimization Study, and the press release dated September 24, 2015 in respect of the September
2015 Mineral Resource estimate for further details and assumptions relating to the project.
The Qualified Persons that prepared the technical reports and press releases that form the basis for the presentation are listed in the Company’s AIF dated July 27, 2015.
Disclosure of a scientific or technical nature in this presentation was prepared under the supervision of Patrick Godin, P.Eng. (Québec), Chief Operating Officer and Robin
Hopkins, P.Geol. (NT/NU), Vice President, Exploration, both “qualified persons” under NI 43-101. Darrell Farrow, PrSciNat, P.Geo.(BC), Ordre des geologues du Quebec
(Special Authorisation # 332) of GeoStrat Consulting Services Inc. is the independent Qualified Person responsible for preparation of the mineral resource estimate for the
Renard Diamond Project. GeoStrat Consulting Services Inc, a mineral resources consultancy, focuses on client interaction and involvement in developing resource
models, and has experience in exploration, geological modeling, resource evaluation, production, resource reconciliation and accounting of diamond deposits around the
globe. GeoStrat has verified the results disclosed herein with respect to the mineral resources, and has conducted appropriate verification on the underlying data, including
visitations to the Renard site and the primary process laboratories.
The Renard
Diamond Project,
November 16, 2015
4. 4
Stornoway Diamond Corporation TSX:SWY
Notes:
1. Assuming a C$:US$ conversion rate of C$1.10
Fully Financed
July 8th 2014: C$946M1 one-shot project financing completed.
On Budget, On Schedule
Construction 52.7% complete compared to 49.0% planned by end October 2015. Forecast cost to
complete within C$811m budget. Plant Commissioning 2H 2016. Commercial Production 2Q 2017.
100% Ownership in Renard, Québec’s First Diamond Mine
Road Accessible; Strong Social License; Fully Permitted; Under Construction
Site Overview Sep 16, 2015
The Renard
Diamond Project,
September 16, 2015
6. 6
Why Stornoway? Renard’s Cash Flow Potential
Based on Base Case Economics
Renard is Expected to Generate Substantial Cash Flow
over its first 11 years of Mining
After Tax, After Stream Operating Cash Flow of between
$150 and $250 million, or $0.20 to $0.30 per share
Assumptions
Mineral reserve case only, averaging 1.6mcarats per annum at US$190/carat
Capital and operating cost parameters as established in the January 2013 Optimization Study
and October 2013 LNG FS
Base case diamond pricing from March 2014; No “special” diamonds.
2.5% annual real diamond price escalation
C$:US$ conversion rate of C$1.10
Based on terms of Financing Transaction closed on July 8th 2014
Assumes full conversion to equity of US$81million of Convertible
Debentures giving 825 million shares outstanding.
Significant Upside Potential from Resource,
Large Diamonds and Processing Capacity
8. 8
The Renard Diamond Project
Québec’s First Diamond Mine
Chibougamau
Montréal
Toronto
800km
360km
Renard
1996: Start of initial regional exploration by Ashton & SOQUEM
2001: First kimberlite discovery
2001-08: Drilling, “mini-bulk” sampling, bulk sampling
2008-10: First NI 43-101 Resource and PEA
November 2011: Feasibility Study issued. First mineral reserve
December 2012: ESIA filed
February 2012: Road construction commences under Plan Nord
March 2012: “Mecheshoo Agreement” executed
Nov.-Dec.2012: Mining Lease and Québec Authorizations
issued
January 2013: Optimization Study issued
July 2013: Federal Canadian Authorizations Issued
September 2013: Road opens
April-July 2014: $C946m financing completed. Construction
commences
2Q 2017: Scheduled Commercial Production
2001: First Kimberlite Discovery
+7-9 Years: First NI 43-101 Resource and PEA
+16 Years: Commercial Production
+12 Years: Final Authorizations Issued
10. 800m
900m
1100m
1200m
1000m
Renard Mine Plan and Key Operating Assumptions
A Combined Open Pit and Underground Operation
Notes
1. Key Assumptions:C$1=US$1, Oil US$95/barrel, 2.5% real terms diamond
price growth, 82.9% ore recovery, 23.8% mining and internal dilution, 0cpht
dilution grade.
2. Expressed in May 2011 terms. Average price US$190/carat in March 2014
terms.
3. Expressed in October 2012 terms, as adjusted in October 2013 LNG FS.
Includes C$754m of costs and contingencies and C$57m of escalation
allowance.
4. Expressed in October 2012 terms. Operating costs C$54/tonne in October
2013 LNG FS terms. Excludes capitalized preproduction costs.
5. Before stream
Reserve and Resource categories are compliant with the "CIM Definition Standards
on Mineral Resources and Reserves". Mineral resources that are not mineral
reserves do not have demonstrated economic viability. The potential quantity and
grade of any Exploration Target is conceptual in nature, and it is uncertain if further
exploration will result in the target being delineated as a mineral resource.
Reserve Based Mine Plan1
(Jan 2013 FS Optimization and October 2013 LNG
Option FS)
Mine Life 11 years
Mineral Reserve 17.9 mcarats
Ave. Diamond Price2
$180/carat
Production Rate 2.2 mtonnes/yr
Ave. Diamond Production 1.6 mcarats/yr
Gross Revenue (C$M)2
$4,268
Initial Capital Costs3
$811m
Operating Cost4
$58/t ($76/carat)
Operating Margin5
67%
Payback 4.8 years
10
0m
100m
200m
400m
600m
700m
500m
300m
Renard 4
Renard 9
Renard 65
Renard 2
Renard 3
Mineral Resource Estimate Effective September
24, 2015 (NI 43-101)
13 mcarats Inferred Mineral Resources
33 to 71 mcarats TFFE
30 mcarats Indicated Mineral Resources
An Updated Renard Mine Plan, scheduled for Q2
2016, is expected to include additional mine
production from new Indicated Mineral Resources
in Renard 2 and Renard 65, deepening of the
Renard 2-3 open pit, extension of the underground
mine infrastructure to 700m, and an optimized
schedule for plant commissioning and ramp-up.
11. 11
Renard 2 Mineral Resource Update
Effective September 24 2015. Changes to Previous Estimate Shown in Italics
Pipe shape
at surface
(1.89ha)
High TFFE at
1,250m (1.38ha)
Notes
1 Reserve and Resource categories were completed in accordance with the "CIM Definition Standards
on Mineral Resources and Reserves". Mineral resources that are not mineral reserves do not have
demonstrated economic viability.
2 Totals may not add due to rounding.
3 Carats per hundred tonnes. Estimated at a +1 DTC sieve size cut-off.
4 Diamond valuation data utilized for the test of prospects of reasonable economic extraction are
derived from a diamond valuation exercise undertaken in March 2014 (see Stornoway Annual
Information Form dated July 2015).
0m
700m
850m
1250m
INDICATED
INFERRED
TFFE
600m: Base of
Previous Indicated
Mineral Resources
Depth
Below
Surface
Kimberlite
outline
at surface
(0.75ha)
Low TFFE at
1,250m (0.62ha)
Base of New
Indicated
Resources
(1.55ha)
Indicated Mineral Resources(1,2,4)
Contained Carats
(millions)
Tonnes (millions) Grade (cpht)(3)
Renard 2, All Units 21.58 +15.6% 25.70 +38.3% 84 -16.4%
Renard 2, w/o CRB-
2A, CRB
20.39 +11.0% 20.52 +15.9% 99 -4.3%
CRB-2A 0.29 +2.6% 0.90 +2.6% 32 --
CRB 0.90 n/a 4.28 n/a 21 n/a
Inferred Mineral Resources(1,2)
Contained Carats
(millions)
Tonnes (millions) Grade (cpht)(3)
Renard 2, All Units 3.88 -48.0% 6.59 -44.0% 59 -7.2%
Renard 2, w/o CRB 3.36 -46.1% 4.08 -22.0% 82 -30.9%
CRB 0.53 -57.6% 2.51 -61.6% 21 +10.5%
Target for Further Exploration(1)
Contained Carats
(millions)
Tonnes (millions) Grade (cpht)(2)
Renard 2, All Units 3.7 to 15.5 6.1 to 15.5 60 to 100
North View Renard 2 NI 43-101 Mineral Resource Estimate
Renard 2 Targets for Further Exploration
Notes
1 Represents potential upside that can be reasonably assumed given the nature and grade of material
within the current 2015 Mineral Resource. The potential quantity and grade of any Exploration Target is
conceptual in nature, there has been insufficient information to define a mineral resource, and it is
uncertain if further exploration will result in the target being delineated as a mineral resource.
2 Carats per hundred tonnes. Potential at a +1 DTC sieve size cut-off.
Pinch in
model in area
lacking drill
coverage
12. 12
0
20
40
60
80
100
120
140
160
180
The Feasibility: 11 years
of mining on 18mcarat
Mineral Reserve
(24mtonnes)
Permitting and Long
Term Plan
The Vision: Deposit still
Open
Millions
of Tonnes TFFE High Range
Inferred Mineral Resource
TFFE Low Range
Indicated Mineral Resource
The Renard Diamond Project
A Large, High Value Diamond Resource with a Very Long Mine Life Potential
0m
100m
200m
400m
900m
700m
500m
300m
Source: Stornoway, 2015
Grades illustrated are for Indicated and Inferred Mineral Resources respectively at a +1DTC sieve
size cut-off. Reserve and Resource categories are compliant with the "CIM Definition Standards on
Mineral Resources and Reserves". Mineral resources that are not mineral reserves do not have
demonstrated economic viability. The potential quantity and grade of any Exploration Target
(previously referred to as a “Potential Mineral Deposit”) is conceptual in nature, and it is uncertain if
further exploration will result in the target being delineated as a mineral resource.
Renard 65
29/24cpht
Renard 3
102/112cpht
Renard 4
61/52cpht Renard 9
53cpht
Renard 2
84/59cpht
800m
600m
1100m
1200m
1000m
30 mcarat Indicated Mineral Resource
13 mcarat Inferred Mineral Resource
33-71 mcarat TFFE
13. 13
Renard’s Diamonds
Large Diamond Potential Not Included in Base Case Diamond Valuation Models
March 2014 Diamond Valuations
(WWW International Diamond Consultants Ltd.)
Kimberlite
Body
Size of
Valuation
Sample
(carats)
WWW March
2014 Sample
Price
(US$/carat)1
WWW March
2014 Base Case
Price Model
(US$/carat)1
Sensitivities
(Minimum to High)
Renard 2 1,580 $187 $197 $178 to $222
Renard 3 2,753 $179 $157 $146 to $192
Renard 4 2,674 $101 $106 ($155)2
$100 to $174
Renard 65 997 $262 $187 $175 to $211
Notes
1. All prices in US$/carat. Samples utilizing a +1 DTC sieve size cut-off.
2. Should the Renard 4 diamond population prove to have a diamond population with a size distribution
equal to the average of Renard 2 and 3, WWW have estimated that a base case diamond price model
of $155 per carat based on March 2014 pricing. Source: WWW March 2014 Valuation Update
Three Renard 65
diamonds: 9.78 ct and
6.41 ct diamonds
recovered from bulk
sampling and a 4 carat
stone discovered in
drillcore in 2003
Base Case Diamond Valuation
Estimates Using Best Practice
Methodology
Average diamond price estimate in
March 2014 for the Mineral Reserves
at US$190/ct (un-escalated)
compared to US$180/ct in the January
2013 Optimization Study.
High Quality Production with
Large Stone Potential
The Renard kimberlites have similar,
but marginally different diamond
populations exhibiting a high
incidence of large white gems.
Coarse Size Distribution in Renard 2
predicts three to six 50-100ct stones
and one to two +100ct stones every
100,000 carats (two to three weeks).
Substantial revenue potential from
large diamonds not accounted for in
the base case cash-flow model.
14. 14
Stornoway will be a Significant Diamond Producer
Current and Future Diamond Producers
Source: Kimberly Process, WWW and Company Reports
Latest 12 Month Sales/ Forecast Future
Average Sales
1 De Beers (Anglo/Botswana) $6,312m
2 Alrosa (Russia) $4,901m
3 Dominion Diamond (TSX: DDC) $872m
4 Rio Tinto (ASE: RIO) $801m
5 Petra (L: PDL) $425m
6 Stornoway (note 2; TSX: SWY) $310m
7 Mountain Province (note 2; TSX: MPV) $259m
8 Gem Diamonds (TSX: GEMD) $241m
9 Lucara (TSX: LUC) $229m
10 Firestone (note 3; L: FDI) $125m
11 Others $2,525m
Total $17,000m
DeBeers
37%
Alrosa
29%
Dominion
5%
RioTinto
5%
Petra
2%
SWY
2%
MPV
1%
GEM
1%LUC
1%Firestone
1%
Others
15%
Notes:
1. Renard estimated at FS average annual diamond production of 1.63 million carats, and WWW March 2014 weighted diamond price of US$190/ct, un-escalated
2. Gahcho Kué estimated at 49% of Revised FS average annual production of 4.45 million carats, and average modeled diamond price of US$118/ct, un-escalated
3. Firestone estimated at revised 2015 mine plan average annual production of 0.95 million carats at an average price of US$132/ct un-escalated
6 Stornoway (note 1; TSX: SWY) $310m
15. 15
Rough Diamond Pricing 2009-2015
A tracking of the diamond market since the publication of the November 2011 FS and January 2013 Opt.
FS indicates rough diamond prices have generally remained within the bounds of sensitivities contained
within the FS financial model (May 2011 spot prices and a 2.5% real terms annual price escalator) in
Canadian$ terms. In US$ terms, prices have declined 15-20%.
WWW Rough
Diamond Price
Index
50
100
150
200
250
300
350
1-Jan-09 1-Jan-10 1-Jan-11 1-Jan-12 1-Jan-13 1-Jan-14 1-Jan-15
Indexto2009=100
WWW Rough Index, Renard Model Price Growth, No Inflation
USD
CAD
May 2011 FS
Diamond Valuation
FS 2.5% Price Model
(Nominal, adjusted
for CPI) with +/- 10%
Sensitivity
17. 17
Project Well Prepared for Execution
Construction Commenced July 10th 2014
Project Site July 2014
Permitting and Social Licence in Place
Mecheshoo Agreement signed with Crees in March
2012, partnership agreements with Chibougamau and
Chapais in July 2012, Québec and Federal
Authorisations in Dec. 2012 and July 2013 respectively.
Access Infrastructure in Place
Renard Mine Road opened to traffic on Aug. 30th 2013.
Renard Aerodrome opened to landings Nov. 5th 2013.
Owner’s Team and EPCM in Place
Owner’s construction team located in Longueuil. EPCM
contract negotiated with SNC-Lavalin, DRA & AMEC.
LNG Power
LNG power option selected to utilize all-season road
and commercial LNG distribution network in Québec.
Favourable Construction Environment
Competitive cost environment and good contractor/
labour availability in Québec.
R65 Borrow Pit
Exploration Camp
Lac Lagopede
Ground Breaking Ceremony July 8th 2014
18. 18
Jean-Charles
Dumont
VP Finance
SWY since 2011
Formerly Corporate
Controller of La
Mancha.
Ebe Scherkus
Chairman of the
Board
Stornoway’s Management Credentials
Experience in Building and Operating Major Projects
Matt Manson
President, CEO
& Director
Pat Godin
COO & Director
SWY since 2011
Formerly President
and COO of Agnico
Eagle Mines Ltd.
Executive Chairman
of Premier Gold
SWY since 2007
Formerly VP
Marketing/VP
Technical Services,
Aber Diamond Corp
(Dominion Diamond;
Diavik Project)
SWY since 2010
Formerly VP Project
Development Gmining
(Essakane Mine).
Successive mine
management and
project development
positions, Cambior
Ian Holl
VP Processing
SWY since 2014
20 years experience De
Beers in plant
construction,
commissioning and
operation (Victor, Snap
Lake, Jwaneng Mines) Yves Peron
VP Engineering
& Construction
SWY since 2012
Formerly VP Bus. Dev.
at Delsaer and Seneca.
Successive
management roles at
ArcelorMittal and
Xstrata.
Martin Boucher
VP Sustainable
Development
SWY since 2010
Formerly Canadian
Royalties (Nunavik
Project) and Xstrata
(Raglan, Gaspesia,
Koniambo Mines)
Brian Glover
VP Asset
Protection
SWY since 2012
Formerly Director
Security Operations
at Harry Winston
(Dominion Diamond).
More than 20 years
experience RCMP.
Robin Hopkins
VP Exploration
SWY since 2006
Formerly Aber
Resources and
discovery of the
Diavik Mine.
19. 19
Site Progress
Site Overview Nov 16, 2015
Project Site Nov 16, 2015
Admin
Process Plant
Accommodation
Maintenance Shop
R2-R3 PitR65 Pit
UG Mine Portal
Crusher
Power Plant
20. 20
Access Infrastructure In Place
The 240km long Route 167 Extension and the Clarence and Abel Swallow Airport
Eastmain River Bridge March 2015
September 2015July 2014
January 2015 Airport Naming Ceremony, March 2015
21. 21
Site Progress
Live Updates on Process Plant Construction at www.stornowaydiamonds.com
Plant Footprint, Oct 21, 2014
Project’s critical path item
Concrete (7 April) steel (14 June)
Building closed and heated by October 31, 2015
First Concrete Pour,
April 7, 2015
August 16, 2015
October 30, 2015
22. 22
Process Plant at 6,000tpd (2.2Mtonnes per
annum) nameplate capacity, expandable to
7,000tpd (2.6Mtonnes per annum)
Optimization by DRA Americas Inc. has
allowed addition of Large Diamond
Recovery (“LDR”) capacity to the flow sheet
for no additional capital.
Flow sheet:
• Primary jaw crushing to < 230mm
• Twin DMS circuits at +1mm -19mm
• LDR circuit at +19mm -45mm, scalable
to -60mm
• Oversize +45mm to secondary cone
crusher
• LDR and DMS tails +6mm -19mm to
tertiary High Pressure Grinding Rolls
Cap-ex (Direct Costs, without Capitalized Op-ex)
• Jan 2013 Cap-ex without LDR: $162.7m
• Optimized Cap-ex with LDR: $147.1m
Thickening and centrifugal treatment of
fines and tails to create a truckable product
for dry-stack disposal.
Diamond Processing Plant
Represents Single Largest Cap-ex Item and Critical Path for Overall Construction
24. 24
Site Progress
Maintenance Facility Completed Approximately 6 Months Ahead of Schedule
July 2015April 2015
Inauguration Ceremony, September 24, 2015 Oct 2015
25. 25
Open Pit Mining
Renard 2 – Renard 3 Pit Pre-stripping Commenced March 2015
R2-R3
R65
Portal
Mining Progress as of October 31 2015
4,819,672 tonnes extracted from R2/R3 and R65 pits vs
plan of 5,210,884 (92%)
R2-R3 Pit October 30, 2015
26. 26
Jumbo in Decline, May 25, 2015 Decline Ventilation, Sept 25, 2015
R2-R3
R65
Portal
Decline Progress as of October 31,
2015
837m against plan of 916m (91%)
Underground Mining
27. 27
Project Schedule
Based on Construction Mobilization July 10th 2014
Feasibility Study (Complete)
ESIA (Complete)
Public Hearings (Complete)
Reg. Authorizations (Complete)
Specific Operating Permits (50)
Road Construction (Complete)
Project Financing (Complete)
Detailed Engineering
Site Construction
Commissioning and Ramp-up
Commercial Production
2012
2H 2H 2H 2H2H 1H 1H 1H1H
2013 2014 2015 2016
2H1H
2017
Based on the Renard Diamond Project Construction Schedule, Plant
Commissioning is Planned for H2 2016 and Commercial Production in Q2 2017.
Dec 2015
First Vehicle Access
Completion Status
Construction (to Oct 31):
52.7% (planned 49.0%)
Engineering (to Oct 31):
94.3% (planned 97.7%)
29. 29
Shareholding
Share Price (TSX-SWY):
Dec 8, 2015
C$ $0.72
52 week High-Low C$ $0.46–$0.85
Average Daily Volume:
Last 12 Months
369,907
Market Capitalization: C$ 527 million
Total Shares Outstanding: 732 million
Total Options & Warrants Outstanding:
(28.9m Options $0.51-$2.50; 123.3m
warrants $0.90-$1.21)
152 million
Consolidated Cash1:
(as of October 31, 2015)
C$ 290 million
Consolidated Debt1:
(as of October 31, 2015)
C$ 219 million
Undrawn Financing Commitments2:
(Subject to Financing Agreement CPs)
C$ 214 million
Balance Sheet
Balance Sheet and Capital Structure
Notes
1. Unaudited
2. Assuming a C$:US$ conversion rate of C$1.10. Does not include $48 million in Cost Overrun Facilities
Investissement Québec 28.6% 22.7%
Orion Mine Finance 19.5% 17.5%
CDPQ 6.1% 6.2%
Float 45.8% 53.6%
DilutedBasic
30. 30
Sources and Uses of Funds to October 31, 2015
On Current C$:US$ Exchange Rates, Unless Noted. Unaudited
(all amounts in millions of C$) Assumed
Actual use
of Proceeds
to Oct 31,
2015
Renard Diamond Project
Capital Expenditures 811 421
Route 167 Extension (1) 70 70
Financing Costs, Interest during
Construction, Loan Repayments
58 27
Mine Closure Guarantee 16 3
Pre-production Net Revenue (26) -
Total Project Costs 929 521
General Corporate Purposes
Equity fees and transaction costs 18 27
General working capital,
administrative and salary expenses
14 6
Total Uses 961 554
Costs
Notes
1. The total amount borrowed pursuant to the Renard Mine Road loan was $77 million, of which $70 million was used for construction of the Renard Mine Road and $7
million was used for civil works related to the airstrip. Costs related to the airstrip were included in the $811 million capital expenditures line in the table above.
2. Assuming a C$:US$ conversion rate of C$1.25
3. Cost Overrun Facility includes the $20 million Senior Loan Facility, Tranche B and the $28 million Cost Overrun Facility with the CDPQ
4. This forecast assumes a project cost of $811 million (which includes assumed levels of escalation and contingencies), the satisfaction of all covenants and
conditions precedent for future funding, and a CAD$:US$ exchange rate of $1.25 for unfunded US dollar denominated financing commitments.
(all amounts in millions of C$)
Sources of Funds
Stream Deposits not yet received (2) 113
Senior Loan Facility, Tranche A 100
Cost Overrun Facility(3) 48
Equipment Financing Facility(2) 17
Undrawn Sources of Funds
As of October 31, 2015, Stornoway forecasts
excess financing capacity available to complete the
project of approximately $100 million comprised
of $52 million of cash, receivables and expected
mine tax credits and $48 million of undrawn cost
overrun facilities(4).
32. 32
Renard Project Financing Transaction Structure
Type
Amount
(% of Total)
Description
Common Equity C$374M (40%)
• C$132M marketed public equity offering of subscription receipts
• C$242M private placement to Orion (US$110M), RQ (C$100M) and Caisse (C$22M)
Diamond Stream US$250M (29%) • 20% diamond stream (Orion 16%, Caisse 4%) with ~US$56/ct(1) ongoing payment
Convertible Debentures US$81M (9%)
• Provided by Orion; 7 year, 6.25% coupon, 35% conversion premium to equity issue
price
Senior Debt C$120M (11%) • Provided by IQ; 7 year amortizing payment, Fixed (QC Bond)+5.75% or Prime +4.75%
Equipment Financing US$35M (4%) • Provided by Caterpillar
Cost Overrun Facility C$48M (5%)
• C$20M provided by IQ (same terms as senior debt)
• C$28M provided by Caisse (unsecured, 7 year term, 10% coupon)
Total C$946M (100%)
Assumes US$1.00 = C$1.10
1. Includes reimbursement of marketing expenses
Counter-Party
Amount
(% of Total)
Orion Mine Finance C$367M (39%)
Investissement Québec/
Ressources Québec
C$240M (25%)
Caisse de dépôt et
placement du Québec
C$105M (11%)
Caterpillar Financial C$39M (4%)
Public C$195M (21%)
Total C$946M (100%)
C$77M
C$811M
C$946M
C$70M
C$67M
Financing Funding Requirements
New
Financing
Existing
Financing
C$48M COF &
C$27M Working
Capital
Financing
Costs &
Interest During
Construction
Renard Mine
Road
Initial Capex &
Escalation
Allowance
33. 33
Renard Stream Highlights
The World’s First Diamond Streaming Arrangement
As a component of the Renard Project Financing, Stornoway concluded a streaming arrangement in the
Renard Project with the CDPQ and Orion Mine Finance.
The streamers have the right to purchase 20% of the LOM production from R2, R3, R4, R9 and R65 for
$56/carat, escalating at 1% per annum on 3rd anniversary of commercial production. The streamers also
subscribed to equity and debt.
For this consideration, Stornoway received US$250million, to fund in three tranches, representing 34% of
the initial capital for the project and 29% of the overall financing plan.
The high operating margins of the Renard project and front-ended capital requirements make it ideally
suited for a streaming arrangement.
On spot C$:US$ exchange, the effective cash cost per carat of the project is lower today than in the January
2013 Optimized Feasibility Study, which assumed a parity dollar, even with consideration of the stream.
Notes
1. Average over 11 Year Mineral Reserve Case, Nominal Terms.
2. Shows the impact of a US$1.00 = C$1.25 exchange rate compared to the US$1.00 = C$1.00 rate utilized in the January 2013 Optimization Study
$58.92
$5.04
$20.43
$76.63 $7.76 $58.92
OS Jan 2013 LNG OS Oct 2013 Stream Exchange Rate Cash cost/ct
Effective Project Cash Cost, Before and After Stream (US$/ct)1
35. 35
Renard Diamond Project NI 43-101 Mineral Resource Estimate
Effective September 24 2015. Changes to Previous Estimate Shown in Italics
Notes
1 Resource categories were completed in accordance with the "CIM Definition
Standards on Mineral Resources and Reserves". Mineral resources that are not
mineral reserves do not have demonstrated economic viability.
2 Totals may not add due to rounding.
3 Carats per hundred tonnes. Estimated at a +1 DTC sieve size cut-off.
4 Diamond valuation data utilized for the test of prospects of reasonable economic
extraction are derived from a diamond valuation exercise undertaken in March
2014 (see Stornoway Annual Information Form dated July 2015).
Indicated Mineral Resources(1,2,4)
Contained Carats
(millions)
Tonnes (millions) Grade (cpht)(3)
Renard 2, All Units 21.58 +15.6% 25.70 +38.3% 84 -16.4%
Renard 2, w/o
CRB-2A, CRB
20.39 +11.0% 20.52 +15.9% 99 -4.3%
CRB-2A 0.29 +2.6% 0.90 +2.6% 32 --
CRB 0.90 n/a 4.28 n/a 21 n/a
Renard 3 1.86 +2.3% 1.82 +3.4% 102 -1.0%
Renard 4 4.44 +3.0% 7.25 -- 61 +3.0%
Renard 65 2.30 -- 7.87 -- 29 --
Total Indicated
Mineral Resources
30.17 +11.4% 42.63 +20.2% 71 -7.4%
Inferred Mineral Resources(1,2)
Contained Carats
(millions)
Tonnes (millions) Grade (cpht)(3)
Renard 2, All Units 3.88 -48.0% 6.59 -44.0% 59 -7.2%
Renard 2, w/o CRB 3.36 -46.1% 4.08 -22.0% 82 -30.9%
CRB 0.53 -57.6% 2.51 -61.6% 21 +10.5%
Renard 3 0.61 -- 0.54 -- 112 --
Renard 4 2.46 +3.5% 4.75 -- 52 +3.5%
Renard 65 1.18 -- 4.93 -- 24 --
Renard 9 3.04 -- 5.70 -- 53 --
Lynx 1.92 -- 1.80 -- 107 --
Hibou 0.26 -- 0.18 -- 144 --
Total Inferred
Mineral Resources
13.35 -20.8% 24.49 -17.5% 54 -4.0%
Inferred Mineral Resources
Indicated Mineral Resources
High Range TFFE
Renard 65
775m depth
Renard 4
775m depth
Renard 9
775m depth
Renard 2
1,250m depth Renard 3
1,250m depth
North East View
36. 36
Renard Diamond Project Exploration Potential
Effective September 24 2015. Changes to Previous Potential Shown in Italics
Notes
1 Target for Further Exploration: represents
potential upside that can be reasonably
assumed given the nature and grade of material
within the current 2015 Mineral Resource. The
Renard 2 shape has been projected 250m
below the deepest kimberlite intersection at
1,000m depth. Tonnage and grade ranges are
not directly applicable to potential total
carats.The potential quantity and grade of any
Exploration Target is conceptual in nature, there
has been insufficient information to define a
mineral resource, and it is uncertain if further
exploration will result in the target being
delineated as a mineral resource.
2 Carats per hundred tonnes. Potential at a +1
DTC sieve size cut-off.
Notes
Resource categories were completed in accordance with the "CIM Definition
Standards on Mineral Resources and Reserves". Mineral resources that are not
mineral reserves do not have demonstrated economic viability.
Area indicated in yellow represents a gap in drill coverage that may represent
additional exploration potential outside of the current Mineral Resource Estimate
and not included in the current Targets for Further Exploration.
Renard 65
775m depth
Renard 4
775m depth
Renard 9
775m depth
Renard 2
1,250m depth Renard 3
1,250m depth
Inferred Mineral Resources
Indicated Mineral Resources
High Range TFFE
North East View
Targets for Further Exploration(1)
Contained Carats
(millions)
Tonnes (millions) Grade (cpht)(2)
Renard 1 1.7 to 3.9 8.6 to 13.0 20 to 30
Renard 2, All Units 3.7 to 15.5 6.1 to 15.5 60 to 100
Renard 3 3.6 to 6.3 3.4 to 3.8 105 to 168
Renard 4 5.6 to 11.8 11.1 to 15.4 50 to 77
Renard 65 7.3 to 13.5 29.0 to 40.9 25 to 33
Renard 7 1.9 to 3.8 6.3 to 9.4 30 to 40
Renard 9 2.0 to 4.3 3.9 to 6.3 52 to 68
Renard 10 0.7 to 2.1 1.2 to 1.7 60 to 120
Lynx 3.0 to 3.8 3.1 to 3.2 96 to 120
Hibou 3.6 to 6.1 3.5 to 4.0 104 to 151
Total TFFE
33.0
+28%
to
71.1
+40%
76.2
+49%
to
113.2
+51%
R10 R7
R1 R65
R4 R9
R2
R3
37. 37
Renard 2 Geological Model and Unit Grades
Effective September 24 2015. Changes to Previous Estimate Shown in Italics
Within the Indicated Mineral Resources
Average Grade
(cpht)(1)
Average Dilution
(%)(2)
Kimb 2a (“Blue”) 76 +3.0% 52 -0.9%
Kimb 2b (“Brown”) 145 +1.0% 30 -0.9%
Kimb 2c (HK)3 229 +0.5% 12 -3.1%
CRB-2a 32 -- 93 --
CRB 21 n/a 96 n/a
Within the Inferred Mineral Resources
Average Grade
(cpht)(1)
Average Dilution
(%)(2)
Kimb 2a (“Blue”) 67 -2.4% 65 +9.2%
Kimb 2b (“Brown”) 145 +0.3% 30 +1.5%
Kimb 2c (HK)3 229 +0.5% 12 -3.1%
CRB 21 +10.5% 96 --
Notes
1 Carats per hundred tonnes. Estimated at a +1 DTC sieve size cut-off.
2 Represents the average amount of non-diamond bearing country rock
estimated within each geological unit.
3 The Kimb 2c (Hypabyssal Kimberlite, or “HK”) unit is a constituent component
of each of the Kimb2a, Kimb2b, CRB and CRB-2a units.
Renard 2 Average Mineral
Resource Grades, by Geological Unit
Kimb2b
(“Brown”)
Kimb2a
(“Blue”) CRB CRB-2a Kimb2c (HK)
West View
Contact
Pinch in model in area
lacking drill coverage
0m
700m
850m
1250m
INDICATED
INFERRED
TFFE
600m: Base of
Previous Indicated
Mineral Resources
Depth
Below
Surface
North View
Photographs of
geological units from
the 2007 Renard
underground bulk
sample program
38. 38
Renard 2 Geological Model and Renard 2-Renard 3 Convergence
Effective September 24 2015
Pipe shape
at surface (1.89ha)
Kimberlite outline
at surface (0.75ha)
Kimb2b (“Brown”)
Kimb2a (“Blue”)
CRB
CRB-2a
Surface View, Looking Down
Surface View, Looking Down
0m
700m
850m
1250m
R2 INDICATED
R2 INFERRED
R2 TFFE
Depth
Below
Surface
R3 INDICATED
R3 INFERRED
R3 TFFE
North East View
Resource categories were completed in accordance with the "CIM Definition Standards
on Mineral Resources and Reserves". Mineral resources that are not mineral reserves do
not have demonstrated economic viability. The potential quantity and grade of any
Exploration Target is conceptual in nature, there has been insufficient information to
define a mineral resource and it is uncertain if further exploration will result in the target
being delineated as a mineral resource.
Renard 2 Renard 3
Renard 2
Renard 3
126.6m R3 intersection in DDH R2-
81J (in red) starting 942.2m
downhole: 47m true width.
R3 TFFE:
>500m potential
between drill
intersections
39. 39
Chronology of Renard Studies
Feasibility Study
Released on November 16th 2011. NI 43-101 Technical Report filed December 29 2011.
11 Year Mine Plan based on 18 Mcarat Mineral Reserve derived from January 2011 NI 43-101 Resource.
Long Term Business Plan
Companion study to the Feasibility Study with an extended mine plan incorporating the project`s 17.5 million carats of
Inferred Mineral Resources.
Basis of overall mine design and project permitting. Not part of the project`s public disclosure, consistent with Canadian
reporting standards
Optimization Study
Released on January 28th, 2013. NI 43-101 Technical Report filed March 2013.
Refined of Feasibility mine design, including shaft deferral and a modified underground mining sequence.
11 Year Mine Plan based on 17.9 million carat Mineral Reserve.
Resource Update
Released July 2013. NI 43-101 Resource update with 14% increase in Indicated Resource contained carats
LNG Feasibility Study
Released October 2013. Modified project Cap-ex and Op-ex for LNG powered gen-sets
Resource Update
Released September 2015. NI 43-101 Resource update with 11% increase in Indicated Resource contained carats
40. 40
January 2013 Optimization Study
Project Assumptions, Valuation and Pay-Back in the January 2013 FS Optimization Study
Key Assumptions in the Financial Model1
Mining
Parameters
Reserve Carats (M) 17.9
Tonnes Processed (M) 23.8
Recovered Grade (cpht) 75
Average Ore Recovery (%) 82.9%
Average Mining Dilution (%) 17.9%
Dilution Grade (cpht) 0
Processing Rate (Mtonnes/annum) 2.2
Mine Life (years) 11
Cost
Parameters
Initial Cap-ex (C$M)2 $752
LOM Cap-ex (C$M)4 $1,013
Oil Price (US$/barrel)2 $95
LOM Op-ex (C$/tonne)2 $57.63
LOM Op-ex (C$/carat)2 $76.63
Revenue
Parameters
Gross Revenue (C$M)2 $4,268
Marketing Costs 2.7%
DIAQUEM Royalty 2.0%
Cash Operating Margin (C$M)2 $2,693
% Operating Margin 67%
Income Tax, Mining Duties and IBA
Payments (C$M)1 $625
After Tax Net Cash Flow (C$M) $1,084
Diamond
Price
Parameters3
Renard 2 and Renard 3 (US$/carat) $182
Renard 4 (US$/carat) $164
Diamond Price Escalation 2.5%
Exchange rate 1C$=1US$
Schedule
Parameters6
Effective Date for NPV Calculation Jan. 1 2013
Construction Mobilization/Early Works Aug. 1 2013
Plant Commissioning Commences Dec. 1 2015
Commercial Production Declared Jun. 1 2016
Valuation Results5
(C$m)
Pre-Tax After Tax
NPV5% $894 $537
NPV7% (Base Case) $683 $391
NPV9% $514 $274
IRR 20.4% 16.3%
Pay-Back (years) 4.69 4.82
Notes
1. Optimization Study, released January 28th 2013.
2. Expressed in October 2012 terms.
3. Expressed in May 2011 terms.
4. Expressed in nominal terms.
5. Expressed in de-escalated nominal terms.
6. Schedule parameters are based on the schedule in
the Optimizaton Study, released on January 28th
2013. For revised schedule, please see our AIF
dated July 27th, 2015.
41. 41
Probable Mineral Reserve
Mining Recovery Factors Utilized in the Reserve
Calculation
Kimberlite
Grade
(cpht)
Tonnes
(millions)
Contained
Carats
(Millions)
Internal
Dilution
Mining
Recovery
Mining
Dilution
Renard 2 OP 95 1.31 1.24 0.0% 96.0% 7.1%
Renard 2 UG 80 17.03 13.62 7.0% 82.4% 20.2%
Renard 3 OP 93 0.72 0.67 0.0% 96.0% 10.5%
Renard 3 UG 84 1.00 0.84 21.1% 85.0% 14.0%
Renard 4 UG 42 3.72 1.58 1.4% 78.2% 14.0%
Total 75 23.79 17.95 5.9% 82.9% 17.9%
Notes: Reserve categories are compliant with the "CIM Definition Standards on Mineral Resources and Reserves". Totals may not add due to rounding. Grades are estimated at a
+1DTC sieve size cut-off.
R2 ,
83%
R3, 8%
R4, 9%
Revenue
R2 , 77%
R3, 7%
R4, 16%
Tonnage
R2 , 83%
R3, 8%
R4, 9%
Carats
NI 43-101 Probable Mineral Reserves
January 28th 2013
42. 42
Liquefied Natural Gas Power Plant
The November 2011 Feasibility Study and January
2013 Optimization Study both contemplated on-site
power generation using traditional diesel fueled gen-
sets.
With a view to project optimization, in 2013
Stornoway undertook an investigation into a more
cost efficient alternatives for on-site power supply.
On October 21st 2013 Stornoway announced it will
proceed with an LNG fuelled gen-set option, made
possible by the ability to receive regular cryogenic
LNG shipments on the Renard Mine Road.
The Renard LNG plant will comprise seven 2.1MW
rated gas gen-sets, providing sufficient power
generation capacity for the project’s normal operating
specification of 9.5MW.
LNG has significant cost and environmental
advantages over traditional diesel powered gen-sets
and a Hydro-Québec power-line option.
Diesel will continue to be used for the mobile mining
fleet and construction activities.
43. 43
Liquefied Natural Gas Power Plant
Feasibility Study Released October 2013
An LNG fuelled powerplant for Renard offers many advantages over diesel:
• Greatly reduced annual operating costs of $8m to $10m per year, for a small incremental
capital cost of $2.6m.
• Up to 43% less greenhouse gas emissions.
• stable supply market utilizing existing commercial distribution network within Québec.
• Elimination of on-site propane, as LNG will be used for building and underground mine
heating
Cost Improvements with LNG
2013 Optimization
Study with Diesel
2013 Optimization
Study with LNG
Unit Power Cost (C$/kWh) 1
$0.299 $0.188 (-37%)
Unit Operating Cost (C$/tonne) 1,2
$57.63 $53.84 (-7%)
Initial Capital Cost (C$m) 1
$752.1 $754.0 (+0.3%)
Life of Mine Capital Cost (C$m) 1,3
$1,013 $1,010 (-0.3%)
Annual Diesel Consumption (million litres) 27.5 5.9 (-79%)
Annual LNG Consumption (thousand m3
/annum) n/a 41.7
Annual Propane Consumption (thousand m3
/annum) 3.5 n/a
Notes
1. 2013 Optimization Study costs expressed in October 2012 terms.
2. Excludes capitalized preproduction costs.
3. Includes all initial, sustaining and deferred capital, contingencies and escalation
Key Assumptions
Based on the 11 year reserve-based mine life (17.9 mcarats) contained within
the 2013 Optimization Study, with a normal operating load of 9.49MW,
C$1=US$1, Oil US$95/barrel
45. 45
Marie-Anne Tawil
Independent/
IQ Designate
Hume Kyle
Independent
Pat Godin
COO & Director
Matt Manson
President, CEO
& Director
John LeBoutillier
Independent/
IQ Designate
Peter Nixon
Independent
Ebe Scherkus
Independent/
Board Chairman
Executive Officers
Non-Executive Directors
Key Managers
Head Office: Longueuil, Québec
Exploration Office: North Vancouver, BC
Community Offices: Mistissini & Chibougamau Québec
Stornoway’s Board and Management Team
Serge Vézina
Independent
Yves Perron
VP Engineering
& Construction
Ghislain
Poirier
VP Public Affairs
Brian Glover
VP Asset
Protection
Martin Boucher
VP Sustainable
Development
Robin
Hopkins
VP Exploration
Orin
Baranowsky
Director, IR
Douglas Silver
Orion Designate
Ian Holl
VP Processing
Annie Torkia-
Lagacé
VP Legal Affairs
Gaston Morin
Independent/
IQ Designate
Jean-Charles
Dumont
VP Finance
Helene
Robitaille
Director, HR
46. 46
Pat Godin
COO & Director
Biographies
Ebe Scherkus
Chairman of the
Board
Matt Manson was appointed President of Stornoway Diamond Corporation in March 2007 and subsequently President &
CEO in January 2009. Between 1999 and 2005 he was employed by Aber Diamond Corporation (now Dominion
Diamond Corporation) as VP Marketing and subsequently VP Technical Services & Control, during which time he
participated in the US$230m project financing for the Diavik Diamond Project and oversaw Aber's technical and
marketing operations. In March 2015 he was awarded the Viola MacMillan award from the Prospectors and Developers
Association of Canada for the financing and development of Stornoway’s Renard Diamond Project. Mr. Manson is a
graduate of the University of Edinburgh (BSc Geophysics, 1987) and the University of Toronto (MSc Geology 1989 and
PhD Geology, 1996), and has over 20 years of experience in diamond exploration, development and production.
Pat Godin joined Stornoway as COO in May 2010. He was previously VP, Project Development for GMining Services,
responsible for the development of the Essakane Mine in Burkina Faso under contract to IAMGOLD, VP Operations for
Canadian Royalties, and President and General Manager of CBJ-CAIMAN S.A.S., a French subsidiary of Cambior /
IAMGOLD. For many years, he was involved in Cambior’s various Canadian properties in Abitibi-Témiscamingue,
through progressive management positions in project development and mine management. He holds a bachelor’s degree
in mining engineering from Université Laval in Québec and is a member of the “Ordre des Ingénieurs du Québec”. He is
the Chairman of the Board of Geomega Resources.
Ebe Scherkus served as the President and Chief Operating Officer and a director of Agnico-Eagle from 2005 to February
2012. Prior to his appointment as President and Chief Operating Officer in December 2005, Mr. Scherkus served as
Executive Vice-President and Chief Operating Officer from 1998 to 2005, as Vice-President, Operations from 1996 to
1998, as a manager of Agnico Eagle LaRonde Division from 1986 to 1996 and as a project manager from 1985 to 1986.
Mr. Scherkus is a graduate of McGill University (B.Sc.), a member of the Association of Professional Engineers of Ontario
and past president of the Québec Mining Association.
Matt Manson
President, CEO
& Director
47. 47
Stornoway Diamond Corporation TSX:SWY
Head Office:
1111 Rue St. Charles Ouest,
Longueuil, Québec J4K 4G4
Tel: +1 (450) 616-5555
IR Contact:
Orin Baranowsky, CFA, Director IR
obaranowsky@stornowaydiamonds.com
Tel: +1 (416) 304-1026 x2103
www.stornowaydiamonds.com
Info@stornowaydiamonds.com