CPM Investor Presentation 2019-12

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CPM Investor Presentation 2019-12 Plant nutrition for a healthier world TSX-V: CPM | OTCQX: CPMMF | Investor Presentation | Q4 2019 CRYSTAL PEAK MINERALS DISCLAIMER This presentation is for informational purposes and does not constitute an offer or a solicitation of an offer to purchase securities. This presentation contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements related to activities, events or developments that Crystal Peak Minerals Inc. (“CPM” or the “Company”) expects or anticipates will or may occur in the future, including, without limitation; statements related to the economic analysis of the Project; the Feasibility Study; mineral reserves; mineral resource estimate; the permitting process; environmental assessments; business strategy; objectives and goals; and exploration of the Sevier Playa Project. Forward-looking information is often identified by the use of words such as "plans", "planning", "planned", "expects" or "looking forward", "does not expect", "continues", "scheduled", "estimates", "forecasts", "intends", "potential", "anticipates", "does not anticipate", or "belief", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information is based on factors and assumptions made by management and considered reasonable at the time such information is provided. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause the actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking information. The Company’s Feasibility Study (the “FS”) should be considered incomplete. It is based upon details that may change, which would impact costs and estimates. Operating costs for the Project were based upon assumptions including future energy costs, propane and natural gas costs, water costs, labor, and other variables that are likely to change. Capital costs were based upon a list of equipment thought to be necessary for production. Potassium sulfate and other price forecasts were based upon third-party estimates and management assumptions that may change due to market dynamics. The mineral resource estimates were based upon assumptions outlined in the “Resource Estimate” section. Some figures were calculated using a factor to convert short tons to metric tonnes. Changes in estimated costs to acquire, construct, install, or operate the equipment, or changes in projected pricing, may adversely impact project economics. Among other factors, the Company’s inability to obtain sufficient recharge water; the inability to anticipate changes in brine volume or grade due to recharge or other factors; changes to the economic analysis; the failure to obtain necessary permits to develop the Sevier Playa Project; environmental issues or delays; inability to successfully complete additional trenching and drilling at the Sevier Playa Project; factors disclosed in the Company's current Management's Discussion and Analysis; as well as information contained in other public disclosure documents available on SEDAR at www.sedar.com may adversely impact the Project. The information presented herein was approved by management of the Company on December 16, 2019. Although CPM has attempted to identify important factors that could cause actual actions, events, or results to differ materially from those described in the forward-looking information, there may be other factors that cause actions, events, or results not to be as anticipated, estimated, or intended. There can be no assurance that forward-looking information will prove to be accurate. The forward-looking information contained herein is presented for the purposes of assisting investors in understanding the Company's plans, objectives, and goals and may not be appropriate for other purposes. Accordingly, readers should not place undue reliance on forward-looking information. CPM does not undertake to update any forward-looking information, except in accordance with applicable securities laws. This Investor Presentation should be read in conjunction with the Company’s technical report entitled “NI 43-101 Technical Report Feasibility Study of the Sevier Playa Sulfate of Potash Project, Millard County, Utah” dated effective January 11, 2018 (the “Technical Report” or “FS”) prepared by Novopro Projects Inc. and Norwest Corporation (Norwest) available at the Company’s website and on its SEDAR profile at www.sedar.com. The qualified persons for the FS are: Mr. J. Brebner, P. Eng., QP, (Novopro) is the QP responsible for the infrastructure, market studies and contracts, Capital Cost, environmental studies, permitting, social or community impact portion of the Report, and the overall preparation of the Report. Mr. A. Lefaivre, P. Eng., QP, (Novopro) is the QP responsible for the mineral processing and metallurgical testing and recovery methods portion of the Report. Mr. D. Bairos, P. Eng., QP, (Novopro) is the QP responsible for the Capital Cost and Operating Cost estimates, and risk analysis portion of the Report. Mr. C. Laxer, P. Eng., QP, (Novopro) is the QP responsible for the economic analysis portion of the Report. Mr. L. Henchel, P. Geo., QP, (Norwest) is the QP responsible for the history, geology, exploration, drilling, sample preparation, analyses and security, data verification, and Mineral Resource estimate portion of the Report. Mr. R. Reinke, P. Geo., QP, (Norwest) is the QP responsible for the Mineral Reserve estimate, groundwater modeling, and mining methods portion of the Report. Mr. S. Ennis, P. Eng., QP, (Norwest) is the QP responsible for the geotechnical design and mining methods portion of the Report. The content of this investor presentation has been read and approved by Dean Pekeski, P. Geo, Vice President - Project Development of the Company, a Qualified Person as defined by NI 43-101. CRYSTAL PEAK MINERALS 2 INVESTMENT HIGHLIGHTS Only permitted greenfield brine SOP project in the large Americas market Feasibility Study demonstrates compelling economics* § $730 million NPV § 30-year mine life § 6.8 million tons proven and probable reserves Proximate to infrastructure and end markets Strong market outlook for SOP driven by growing demand Seasoned management team with track record of project development success Returns upside through project optimisation initiatives underway Catalysts for near-term value creation including offtake and mine construction *Source: FS and Company reports. Please review FS for details; available on the Company’s website and on sedar.com. CRYSTALCRYSTAL PEAK PEAK MINERALS MINERALS 33 COMPANY PROFILE Compass Minerals v Crystal Peak Minerals is a development- (SOP) stage potash company controlling over SALT LAKE CITY 124,000 acres on the Sevier Playa in Utah Intrepid Potash (MOP) v Developing the Americas next SOP project to supply a large and growing market CRYSTAL PEAK v Situated perfectly to supply SOP into multiple MINERALS Sevier Playa regional markets ` Intrepid Potash (MOP) Approximate Outline of Ancient v Significant Reserve & Resource Lake Bonneville underpinning a long mine life and compelling project economics CPM completing test trench work on the Sevier Playa *Source: FS and Company reports CRYSTAL PEAK MINERALS 4 COMPELLING PROJECT ECONOMICS FeasibiLity Study (FS) announced January 11, 2018 KEY ASSUMPTIONS: ECONOMIC INDICATORS* • 100% equity financing NPV (after tax, 8%) $730 M • SOP production ramp-up over IRR (after tax) 21% three years; from first production of 30,000 Proven and Probable Reserves 6.802 M tons tons in 2022 to fuLL capacity of Mine Life 30 years at Least 372,000 tons in 2025 • MineraL resource at four times EBITDA at FulL Production Rate ~$150 M reported reserve Total Initial Capital Costs $398 M Average Operating Cost (over LoM) $205/ton SOP Price (ex-works) $575/ton Production Royalties (% of gross revenues) 5.61% MateriaL upside potentiaL identified After-Tax Payback (from initial production) 4.5 years since compLetion of FS (See sLide 16) *Source: FS and Company reports CRYSTAL PEAK MINERALS 5 SULFATE OF POTASH (SOP): AN ESSENTIAL FERTILIZER Specialty fertilizer essential for many hiGh value crops Superior quality, premium-priced potash Offers important benefits over muriate of potash (MOP) • increased yields • improved color, flavor and shelf life • favorable in arid climates • preferable for chloride-sensitive crops • higher drought resistance Preferred for use in arid or chloride-sensitive soil CRYSTAL PEAK MINERALS 6 THE SOP MARKET: A COMPELLING OPPORTUNITY Significant market opportunity in Americas With majority of supply coming from a single high-cost domestic producer With the balance imported primarily from Europe. Domestic supply is largely constrained leaving supply gap to widen as regional demand grows GLOBAL MARKET NORTH AMERICAN SOP SOP PRICING PREMIUM: TONS PER ANNUM (T.P.A.) MARKET 50-100% 2017 DATA (including Mexico - tons per annum) AVG. PRICE PER TON, DECEMBER 2018 610k* Potassium fertilizer: $615 85.8 million t.p.a. DEMAND DRIVERS: 515k • Healthier food choices • Organic crops SOP fertilizer: $440 • Increasing population 2.4% $315 7.6 million t.p.a. CAGR • Reduced arable land • More frequent droughts SOP average growth: 2.2% per year 2018 2025 Cornbelt Calif. Calif. MOP MOP SOP Source: CRU and Parthenon Source: CRU, Parthenon, and
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