Financing Mining Projects
in South America
Simion S. Candrea
Mining Investment Banking
MineSouthAmerica: Focus on Colombia Seminar
17 June 2010
This presentation was prepared exclusively for the benefit and internal use of the Jennings Capital client whom it is directly addressed and
delivered (including such client’s subsidiaries, the “Company”) in order to assist the Company in evaluating, on a preliminary basis, the feasibility
of a possible transaction or transactions and does not carry any right of publication or disclosure, in whole or in part, to any other party. This
presentation is for discussion purposes only and is incomplete without reference to, and should be viewed solely in conjunction with, the oral
briefing provided by Jennings Capital. Neither this presentation nor part of its contents may be disclosed or used by any other purpose without
the prior written consent of Jennings Capital.
The information in this presentation is based upon any management forecasts supplied to us and reflects prevailing conditions and our views on
this date, all of which are accordingly subject to change. Jennings Capital’s opinions and estimates constitute Jennings Capital’s judgment and
should be regarded as indicative, preliminary and for illustrative purposes only. In preparing this presentation, we have relied upon and assumed,
without independent verification, the accuracy and completeness of all information available from public sources or which was provided to us by
or on behalf of the Company or which was otherwise reviewed by us. In addition, our analyses are not and do not purport to be appraisals of the
asset, stock, or business of the Company or any other entity. Jennings Capital makes no representations as to the actual value which may be
received in connection with neither a transaction nor the legal, tax or accounting effects of consummating a transaction. Unless expressly
contemplated hereby, the information in this presentation does not take into account the effects of a possible transaction or transactions
involving an actual or potential change of control, which may have significant valuation and other effects.
Jennings Capital’s policies prohibit employees from offering, directly or indirectly, a favorable research rating or specific price target, or offering
to change a rating or price target, to a subject company as consideration or inducement for the receipt of business or compensation. Jennings
Capital also prohibits its research analysts from being compensated for involvement in investment banking transactions except to the extent that
such participation is intended to benefit investors.
Jennings Capital Inc. and its affiliates do not provide tax advice. Accordingly, any discussion of tax matters included herein (including any
attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by
anyone not affiliated with Jennings Capital of any of the matters addressed herein or for the purpose of avoiding tax related penalties.
This presentation does not constitute a commitment by Jennings Capital to underwrite, subscribe for or place any securities or to extend, arrange
or provide any other services.
2
Financing Mining Projects in Colombia/ South America
Presentation Highlights

Investing Rationale:



Investing in Colombian: Rationale
Why Colombia
Financings Projects/ Companies in Colombia

Mechanisms

Recent capital markets trends

Future

Jurisdiction and mining legislation

One of the most underexplored mineral regions

Stable democracy for over 60 years
Accessing International Capital Markets
Jennings Capital Inc./ Case Study: Greystar Resources

Listing on the TSX/ TSX V: IPO, RTO

Straight Equity Financings

Project Financings: Debt, Equity, Exotic

Capital providers: individual & institutional investors,
strategic partners, supranationals
Jennings Capital Inc.
3

Independence

Full service investment dealer

Expertise in mining

Partnership model
Why Invest in Colombia?
GDP & Economic
Growth



Experienced accelerating growth between 2002 and 2007
2008: US$242 billion, 2009: US$235 billion
Mining and Oil & Gas sectors – significant contributors to GDP
Politically Stable and
Environmentally
Friendly

Government is a popular two-term administration with a “right of centre”
political orientation and active pro-business policies
No history of nationalizing foreign holdings or defaulting on foreign debt
Clear environmental approval system



Favorable Climate
for Investment






Mining
Leadership
Mining investment in 2010 forecasted at around $3 billion (Minister of
Mining Hernan Martinez)
The World Bank ranked Colombia as the most business friendly country in
Latin America
Legal Stability Contracts with Colombian Government
Free Trade Zones – 15% income tax, allowing sales in the local market
Latin America’s largest coal producer, 2nd largest gold producer, 4th largest
oil producer, and only platinum producer
Modern, incentive structured Mining Act (passed new mining laws in 2001)
Active international mining company presence with several large scale
operations with attendant port and railroad facilities




Source: “Invest in Colombia”; Thomson Reuters
4
Cerro Matoso – BHP Billiton’s nickel laterite mine (operating
since 1982)
El Cerrejon – coal mining JV between BHP Billiton, Anglo
American, and Xstrata
Pacific Rubiales – oil & gas
Anglo Gold re-establishes/ relocates, in 2006, expl. office
from Lima
Doing Business in Colombia

Colombia - the most business friendly country in Latin America 2010 (The World Bank - “Doing Business Report”)

Colombia - named as a Top 10 reformer for the last 4 years

From 2007 to 2010, Colombia improved 42 positions, reaching 37th in the ranking of 181 countries
Source: World Bank “Doing Business 2010 Report”
5
Investor Protection in Colombia
Colombia Ranks No.1 in Latin America that Best Protect Investors*
*Ranking made up by 183 countries
Source: World Bank “Doing Business 2010 Report”
6
Colombia is a Focus for TSX/ TSX-V Mining Companies
TSX: 7 Co’s, 21 Different Properties
TSXV: 9 Co’s, 17 Different Properties
TSX: 5 cos, 11 props
TSXV: 6 cos, 24 props
TSX: 10 cos, 22 props
TSXV: 10 cos, 26 props
TSX: 7 cos, 23 props
TSXV: 17 cos, 42 props
TSX: 21 cos, 80 props
TSXV: 27 cos, 76 props
TSX: 30 Co’s, 114 props
TSX V: 53 Co’s, 143 props
TSX: 9 cos, 9 props
TSXV: 6 cos, 21 props
TSXV: 3 cos, 4 props
TSXV: 2 cos, 19 props
TSX: 22 cos, 56 props
TSXV: 35 cos, 84 props
Source: the TMX Group
TSX: 23 cos, 81 props
TSXV: 34 cos, 143 props
7
Colombia: Large Undeveloped Gold and Coal Mines
Current Coal Reserves 17 Billion Tons; Annual Production of Only 73.5 Million Tons
CERREJON
ANGOSTURA
 Largest undeveloped gold
project in the world

World’s largest open pit
coal mining operation
 11.5 M Au oz M&I; 3.5 M Au oz
Inferred

2008: 736.3 Mt 2P;
1,379.9 Mt M&I
 Owner: Greystar Resources

Operator: Anglo American
MARMATO
LA BODEGA
 7.5 M Au oz M&I; 2.2 M Au
oz Inferred
 Hosts high-grade Au in the
La Mascota Zone
 Owner: Medoro Resources
 Owner: Ventana Gold Corp.
Colombia Based
TSX Listed Co’s:
LA COLOSA
 2009: 12.32 M Au oz M&I
 Alder Resources ltd.
 Owner: AngloGold Ashanti
 AngloAmerican PLC
GRAMALOTE
PAVO REAL PROJECT
 2009: 1.04 M Au oz
Indicated & Inferred
PERU
 Owners: B2Gold (JV with
AngloGold Ashanti)
 Exploration stage
 AngloGold Ashanti
 Antioquia Gold
 Colombian Mines
 Galway Resources
 Medoro Resources
 Up to 50 g gold in surface
samples
 Miranda Gold Corp.
 Owner: Miranda Gold
 OroAndes Resource
Source: Invest in Colombia; Company Reports
 Ventana Gold Corp.
8
Colombia: Untapped O&G Potential

Colombia – next exporter of crude since 1980s; production peaking @ ~860
MBbl/d (Dec 1998) and dropping to ~540 MBbl/d in just 24 months, a 37%
reduction



Colombia - currently produces ~776 MBbl/d of crude while consuming ~234
MBbl/d

Current production ~ 19.5% higher than the same period last year

Downward trend has clearly been reverted
2008 - Colombia stated its goal - doubling production by 2015 ~ equating to
roughly 1.3 MMBbl/d



Colombia was at risk of becoming a net importer of oil
Which would require multitude of exploration wells, followed by extensive
development scenarios post success
Round Colombia 2010 - contains 225 blocks for auction

Resulting in a dramatic increase in demand for drilling rigs during the next few
years

All exploration and production contracts contain a minimum one well
commitment (exploration or stratigraphic - onshore only) in the first 36 months
The Round Colombia 2008 had 158 blocks up for auction, with the ANH
receiving bids on 80 blocks - most of these blocks contain the aforementioned
minimum work commitments
Source: Jennings Capital Inc. Research; EIA
9
Colombian Elections: June 20th, 2010 (Second Round)
Juan Manuel Santos
Antanas Mockus

Juan Manuel Santos Calderón

Born: March 25th, 1952

Leader: Social Party of
National Unity

Aurelijus Rutenis Antanas
Mockus Šivickas

Born: August 10th, 1951

Leader: Colombian Green
Party
(Partido Social de Unidad
Nacional or “Partido de «la U»)

(Partido Verde Colombiano)
Liberal conservative Colombia's largest political
party

Former Defense Minister

Economics - University of Kansas; Economic
Development and Public Administration: London
School of Economics, Business & Journalism: Harvard

Green party - "political
middle“

Professor & researcher:
between 1975 and 1993

Former Mayor of Bogota

Math degree: University of Burgundy in Dijon, France
MA in philosophy: National University of Colombia
Both Candidates Support President Uribe Policies
First Round - May 30th, 2010: Santos 46.57% vs. Mockus 21.5%
10
TSX Value Added: Time, Flexibility and Visibility
Leading Natural Resources with Best in the World Mining Expertise

Access to capital enables production growth (organic and through acquisitions):


TSX has a proven track record of financing, listing and trading mining companies with 57% of the world’s
public mining companies on TSX
Canadian Equity Markets raised 7 times AIM, 2.5 times ASX and 2.5 times LSE for mining companies in 2009

Liquidity event and re-valuation for the main, private shareholders/ owners

Access to larger, more international institutional investors and greater analyst coverage:



Better liquidity, higher market capitalization and higher trading multiples, implying higher valuations
Globally visible specialized indices



S&P/TSX Global Gold Index; S&P/TSX Global Mining Index
Strengthening of Management and Board of Directors:




Over 30 seasoned independent analysts
Share ownership and options give the Company the currency to attract talent
Exchange mandate to mentor management of newly public companies
Pool of talent for outside directors
Ability to finance international projects:

TSX/ TSXV mining companies have 10,000 projects around the world – 50% are outside of Canada

Colombia based only - on the TSX/ Main Board - 7 Companies with 21 properties, while the junior TSXV
maintains listing for 9 Companies holding 17 Colombian based properties
Corporate Governance:

Canada offers a balanced corporate governance approach and sophisticated capital markets compared with
other resource exchanges
11
TSX Value Proposition for Mining & Oil and Gas
What's Listed on TSX and TSX Venture Exchange as at May 31, 2010
Sector
Comm. & Media
Clean Technology
CPC
Diversified Industries
ETFs
Financial Services
Forest Products
Life Sciences
Manufacturing
Mining
Oil & Gas
Other
Real Estate
Structured Products
Technology
Utilities & Pipelines
TOTAL
TSX Venture Exchange
Listed Issuers Total Market Cap
($ Millions)
15
1%
565
1%
79
4%
1,307
3%
186
9%
91
0%
126
6%
1,406
4%
47
2%
524
1%
3
0.1%
99
0.3%
69
3%
861
2%
85
4%
513
1%
1,128
52%
22,450
57%
267
12%
9,501
24%
5
0.2%
24
0.1%
35
2%
638
2%
128
6%
1,284
3%
5
0.2%
53
0.1%
2178 100%
39,314
100%
Toronto Stock Exchange
Listed Issuers
Total Market Cap
($ Millions)
33
2%
119,450
7%
48
3%
16,827
1%
282
19%
240,583
13%
155
10%
38,744
2%
77
5%
458,283
25%
20
1%
14,896
1%
62
4%
10,426
1%
328
22%
362,581
20%
117
8%
349,663
19%
45
3%
40,530
2%
220
15%
25,898
1%
71
5%
58,190
3%
27
2%
82,117
5%
1485
100% 1,818,187
100%
As at May 31st, 2010 (Year-to-Date); Source: TMX Group
12
TSXV and TSX
Listed Issuers
Total Market Cap
($ Millions)
48
1%
120,015
6%
127
3%
18,134
1%
186
5%
91
0%
408
11%
241,989
13%
155
4%
38,744
2%
124
3%
458,806
25%
23
1%
14,995
1%
131
4%
11,287
1%
85
2%
513
0%
1456
40%
385,030
21%
384
10%
359,164
19%
5
0.1%
24
0%
80
2%
41,168
2%
220
6%
25,898
1%
199
5%
59,474
3%
32
1%
82,169
4%
3663
100%
1,857,501
100%
Effective Methods to Go Public on TSX: IPO vs. RTO
Explorer vs. Developer vs. Producer: Venture Exchange vs. Main Board
Early Stage Companies:
Most effective: cost and speed

Expertise in home capital markets

Existing shareholder base
Used mainly by small cap, early stage
non-producing companies

Capital Pool
Company
(CPC)
(Used mainly by small cap,
early stage non-producing
companies)
Special
Purpose
Acquisition
Corp (SPAC)
(Used mainly by small cap,
early stage non-producing
companies)
Reverse
Takeover/Reverse
Merger (RTO)
Initial Public
Offering
(IPO)
Qualifying
Transaction /
Acquisition
Dual Listing:
TSX, BVL
13
Becoming Public: IPO Route
IPO Process, Documents Required and Approximate Timing
Week 1
Process
Private
company
retains TSX
member to
manage the
process
Documentation
Engagement
letter, term
sheet signed
Marketing
Week 2
Week 2 to
Week 6
Due
diligence
work
Week 7
Week 8 to
Week 12
Week 13-16 Week 17 Week 18
Preliminary
due diligence
session prior
to filing
preliminary
prospectus
Engineering
and technical
reports
prepared
and finalized
Prospectus File preliminary
drafting;
prospectus
financials
and greensheet
prepared
and finalized
Presentation
preparation
Market
planning
Security
Commission*;
TSX comments;
Agency
Agreement
drafted
Circulate final Shares listed;
prospectus;
commence
close
trading
transaction
File amended
prospectus;
Submission of
sponsorship
letter
Receipt of
final
prospectus;
Signing of
Agency
Agreement
Types of Listing:
 Preliminary Prospectus
 Conditional listing - Permits listing of shares on
 Agency Offering/Underwriting
Agreement and Sponsorship
Agreement
* Assumes two rounds of comments
TSX pending completion of the IPO, then the
company becomes fully listed after the IPO is
completed
 Standard form listing - For a previously listed
company
 Wrap-around listing - For a previously listed
company
14
Week 20
Final due
diligence
session
Principal Documents Required:
 Audited, and Unaudited Interim,
Financial Statements
Week 19
Commence
Finalize the
marketing with book
preliminary
prospectus
and greensheet
Commence
building the list
of potential
purchasers
("the book")
Becoming Public via RTO: Deal Structure
TSX Listing Criteria
Reverse Merger/ Qualifying Transaction Mechanics
Financial:
 Adequate Funds to Commercialize
 C$4 Million Net Tangible Assets
 18 Month Projection of Sources
1.
“Canadian
Domiciled”
Shareholders
RTO
Distribution:
 Public Float of C$4 million
 300 Public Shareholders
Technical:
CPC/ Shell Co.
Colombian Private Co.
2.
 3 Years of Proven and Probable
Reserves
3. TSX Listed Colombian Public Co.
$$
New Investors
15
Financing Mines in Latin America: Markets and Sources
Current Market Conditions

Worldwide equities – regaining ground after the May
2010 sell-ff:




Capital Sources & Developments (cont’d)
European debt concerns, emerging markets raw
materials demand fatigue, weak recovery in the US

Sustained appetite for precious metals producers

In contrast with Spring/ Summer 2009, bank debt
providers actively pursuing lending mandates

New capital providers/ sources available for South
America
The outlook is one of deflation, corporate balance
sheet strength and liquidity, intense volatility and
ongoing sovereign credit concerns

The era of frugality is clearly intact (D. Rosenberg)
The Fed will likely be on hold for an extended period
of time

Capital Sources




Bank debt/ non-bank debt – yield, covenants,
hedging

Strategic partners/ JVs

Non-traditional/ exotic sources of financings
Luna Gold – Aurizona Project/ Brazil – US$ 17.8m

SilverCrest Mines – Santa Elena, Mexico – US$ 12m
Forward gold sale agreements: Macquarie Bank


16
Carpathian Gold – RDM Gold Project/Brazil – US$ 30m
Supranationals – International Finance Corp. (IFC)

Equity and debt capital markets for publicly listed
enterprises:
TSX/ TSX V; dual-listings (i.e. BVC)


Private/ owner’s capital – very early stages, preresource, private companies

VPP (Volumetric Production Payments or metal
stream deals); i.e. Sandstorm Resources Ltd.
Greystar Resources Ltd. – C$12m private placement
New developments:

Traditionally, project debt financing would close
after equity tranche already raised/ finalized

Currently, more equity investors require debt
financing details/ finalization before committing
capital
Board representation sought by equity investors
Financing Mines in Latin America: TSX Statistics
Equity Markets: Snapshot

New Listings Count: 214 (TSXV: 134 TSX: 80)

114 Canadian Companies + 36 CPCs + 33 ETFs + 8
Structured Products



All listed on the TSX Venture Exchange (120) and TSX
(71) in the first five months of the year
7 US Companies + 1 US Structured Note


Current Financing Environment
All listed on the TSX Venture Exchange (6) and TSX (2) in
the first five months of the year

951 financings vs. 606
$3.3 million – average financing size on TSX Venture
Exchange

15 company IPOs on TSX

42 ETF / Structured Product IPOs

China / Asia, 2, 9%
UK / Europe, 1, 4%
Australia / New
Zealand / Papua
New Guinea, 4,
17%
$3.17 billion raised vs. $859 million at this time last year

All listed on the TSX Venture Exchange (8) and TSX (7)
USA, 8, 35%


15 International Companies

Financings up 269% on TSXV
Other, 3, 13%
Mexico & Central /
South America, 5,
22%
Source: TMX Group – The MiG Report May 2010
17
$4.07 billion in IPO financing vs. $952 million at this time
last year
$50.8 million – average financing size on TSX
Equity Capital Markets: Financing Environment
What's Financed on TSX and TSX Venture Exchange by Sector (May 31, 2010 YTD)
TSX Venture Exchange (C$ Millions)
IPO
PO
PP
Total
Sector
Comm. & Media
Clean Technology
CPC
Diversified Industries
ETFs
Financial Services
Forest Products
Life Sciences
Manufacturing
Mining
Oil & Gas
Other
Real Estate
Structured Products
Technology
Utilities & Pipelines
TOTAL
-
-
29.5
27.1
5.9
79.4
18.0
0.2
18.8
6.2
1,331.1
716.6
6.3
47.8
58.2
-
29.5
77.2
19.4
154.4
18.0
15.7
50.0
6.2
1,574.1
1,059.6
6.3
95.0
64.4
-
2,345.0
3,170.0
50.1
13.5
-
75.0
-
15.6
31.3
27.7
66.5
-
215.3
276.5
47.2
-
-
114.0
711.0
6.2
Toronto Stock Exchange (C$ Millions)
IPO
PO*
PP
Total
-
19.0
122.8
165.0
1,415.0
582.3
1,167.7
-
1,863.8
2.1
1,141.9
60.0
179.4
2,226.2
1,616.2
1,148.1
839.7
31.1
853.3
83.7
2,280.1
260.8
2.1
13.3
-
20.5
467.3
2,192.7
171.9
1,406.3
60.0
263.1
4,671.3
3,292.1
1,730.4
2,009.5
44.4
853.3
4,069.2
10,103.6
3,009.9
17,182.7
270.7
247.7
169.8
51.0
-
*includes supplementary & secondary offerings
As at May 31st, 2010 (Year-to-Date).; Source: the TMX Group
18
1.5
73.8
81.2
213.4
-
IPO
TSXV and TSX (C$ Millions)
PO
PP
Total
270.7
13.5
247.7
169.8
51.0
192.7
1,481.5
582.3
1,167.7
6.2
-
19.0
173.0
1,938.8
2.1
1,141.9
75.6
210.6
2,441.5
1,892.7
1,195.3
839.7
31.1
853.3
31.0
100.9
5.9
160.6
231.4
0.2
102.5
6.2
3,611.2
977.5
6.3
47.8
2.1
71.5
-
50.0
544.5
19.4
2,347.1
171.9
1,424.3
75.7
313.1
6.2
6,245.5
4,351.7
6.3
1,825.4
2,009.5
108.8
853.3
4,183.1
10,814.6
5,354.9
20,352.7
Equity Capital Markets: Financing Environment
What's Financed on TSX and TSX Venture Exchange by HQ Location (May 31, 2010 YTD)
Source: TMX Group
19
TSX Mining and Oil & Gas Equity Capital Markets
Recent Colombian Mining/ O&G Financings
Overall 2009 TSX/ TSX-V Financings

Pending: $50 Million –
Marketed Private Placement
listed mining companies in 2009

Mining Sector tops total equity capital raised in 2009 –
 C$3.0 Billion of equity capital raised in 2009 for South
May 2010: $50 Million Bought Deal
American Mining Projects through 125 financings

Nov 2009: $103 Million –
Marketed Private Placement
Top performing index on TSX was S&P/TSX Diversified
Metals & Mining Index
Oct 2009: $40 Million –
Bought Deal
Sept 2009: $63 Million – Mkt.
Short Form Prospectus
Sep 2009: $12 Million –
Marketed Private Placement
Source: TMX Group/ Company Press Releases
A record $22.2 billion was raised on TSX and TSX-V by the
20
Jennings Capital Inc.: Key Principles
Independence
Full Service
Experience
Strategic advice and sourcing of
capital unconstrained by
ownership – no credit related or
principal trading conflicts
Partnership Model
Founded, owned and operated by
senior investment banking
professionals
Full Service
Partnership
Independence
Focused on corporate finance,
mergers and acquisitions,
institutional sales and trading and
equity research focused on mining,
oil & gas and diversified industries
Experience
Independent Financial Advice and Capital Markets Resources/
Expertise Delivered by Seasoned Senior Professionals
21
Services delivered by senior
investment banking professionals
who are leaders in the field and
have extensively worked in their
industries before banking
Jennings Capital Inc.: Recent Mining Financings
Mining Transactions
June 2007
May 2010
Proven Success

$104,250,000
Lead Underwriter
September 2009
In the last three years, Jennings Capital Inc. has advised in over 40
separate transactions and, in aggregate, managed the placement and
after-market trading of approximately $6.0 billion in equity capital for
over 70 of Canada’s most successful growth businesses

We have led or co-managed offerings ranging in size of up to $392 million

We have most recently financed gold and base metals projects from
different jurisdictions such South America (Colombia, Peru), Canada, US,
West Africa and Australia
$63,250,000
Lead Agent
$385,000,000
Agent
April 2009
$40,519,500
September 2009
September 2009
April 2008
March 2008
December 2009
$80,500,000
Lead Underwriter
Agent
January 2009
$50,000,000
$80,000,000
$40,000,000
Agent
Agent
Lead Agent
$20,000,000
$10,400,000
Underwriter
Lead Underwriter
22
Jennings Capital Inc.: Mining Investment Banking
Daryl J. Hodges – President & CEO

Co-founder of the Jennings’ Toronto operation and
directly oversees the investment banking group

Over the last 11 years, carried out mining equity research
and investment banking at Jennings Capital and at HSBC
Securities including financings of $600K to $1.2 billion


David Donato
Structured, arranged and led past financings totaling in
excess of $2.5 billion

More than 14 years experience in the financial services
industry, including 9 years of investment banking
experience

Former Head of Investment Banking at Loewen,
Ondaatje, McCutcheon and 6 years experience in public
accounting with Arthur Andersen and BDO Dunwoody

B.A. (Honours Chartered Accountancy Program) from the
University of Waterloo, CA from the Institute of
Chartered Accountants of Ontario and CFA charterholder
As a geologist, worked in the mining industry in Canada,
Sweden, Finland, Russia and South-East Asia for over 18
years
Simion Candrea
Ricky Chan

Joined Jennings in early 2005, as an Investment Banking
Associate in our Toronto office

Joined Jennings in January 2008 as an Investment
Banking Associate at our Toronto office

Primarily focused on the mining and special situations
sectors

Primarily focused on the potash/ fertilizer and special
situations sectors

Prior to joining Jennings, five years with RBC Dominion
Securities Inc. and the Dutch Bank ABN AMRO, covering
the Healthcare/Pharmaceutical sector in the European
Emerging Markets

Prior to joining Jennings, six years in the financial
services industry which includes Loewen, Ondaatje,
McCutcheon and Deloitte Financial Institution Group
23
Jennings Capital Inc.: Key People in Mining Research
Peter Campbell
Mark Turner

Professional Mining Engineer with 25 years experience in
the mining business with in-depth mining background

Joined Jennings in February 2008 as an Associate
covering the Mining sector

Formerly an exploration manager with Falconbridge
Limited (now Xstrata) where he worked on various
worldwide exploration projects involving exploration for
Ni, Cu, and Cu-Zn deposits

Prior to joining Jennings, Mark worked for Loewen,
Ondaatje, McCutcheon Ltd. as a mining Research
Associate


Peter is a member of the PEO, CIM, PDAC, SEG and MRAG
Worked for a large Canadian home developer, valuing
land acquisitions and developing infrastructure projects

Peter covers base metals, iron ore, and Canadian gold
producers

Holds a B.A.Sc. in Geological Engineering from the
University of Waterloo and a MBA from the Richard Ivey
School of Business at the University of Western Ontario
Stuart McDougall

Studied geology at the University of Toronto

Joined Jennings in June 2006 with more than 10 years of
mining industry experience, including 4 years as a
reporter for the Northern Mines

A mining research associate with GMP Securities covering
mining companies outside the conventional gold and
base metals sectors

Stuart focuses on gold producers and developers, mainly
in Africa and Latin America
24
Jennings Capital Inc.: Oil & Gas Investment Banking
Robert Jennings – Chairman

40 years investment and resource based experience in
research, investment banking, corporate finance, joint
ventures, mergers & acquisitions

Founded two successful investment banking firms - Carson
Jennings & Associates and Jennings Capital Inc. and has
headed the western Canadian investment banking
divisions of two national firms - McLeod Young Weir and
Midland Walwyn Capital Inc.

David McGorman

Over 15 years of investment banking and corporate
finance experience within the Canadian energy sector

Prior to joining Jennings, was head of Haywood
Securities Inc.’s Calgary corporate finance department

Has advised clients on mergers and acquisitions with an
aggregate transaction value of over $2 billion

Graduated with an Honours B.Sc. in Theoretical Physics
from the University of Guelph and an M.B.A. from the
Michael DeGroote School of Business
He has served and serves on numerous boards, including
Western Financial Group and Investment Dealers
Association (now IIROC)
Liam Balfour
Michael Shumlich

Has over nine years of experience in the oil and gas
investment business encompassing both equity research
and corporate finance

Over six years of investment banking experience in the
oil and gas sector working on both domestic and
international assignments

Recently has been focused on Jennings’ oil and gas
merger and acquisition assignments, having advised on
over $750 million of transactions since January 2003

Two years of corporate development experience with
Agrium Inc., an international fertilizer company


CFA charterholder
Holds a Bachelor of Commerce degree with Distinction, a
Master of Science degree and is a CFA charterholder
25
Jennings Capital Inc.: Recent Oil & Gas Financings
Oil & Gas Transactions
August 2009
Pending
Proven Success

$40,000,000
Agent

We have financed oil and gas projects from different jurisdictions
throughout the world including South America (Colombia, Guyana,
Ecuador, Peru, Argentina and Brazil), Canada, China, Africa and the FSU
In addition, Jennings has carried out many advisory assignments for oil and
gas located both domestically and internationally
$80,500,000
Agent
Pending
December 2009
$65,000,000
$50,000,000
Agent
Advisor
May 2010
May 2010
March 2010
February 2010
$3,400,000
$23,500,000
USD$25,000,000
$63,400,000
Co-Lead
Managing Dealer
Co-Lead
Co-Lead
26
Jennings Capital Inc.: Key People in O&G Research
Gregory Chornoboy

Joined Jennings in 2005 and covers energy companies
with international operations

Prior positions with Amoco Canada Petroleum, Saudi
Aramco, and Ultramar Oil & Gas, as well as undertaking
consulting assignments with various domestic Canadian
energy companies

Entered the investment banking sector in 1993, as Vice
President, Corporate Finance with FirstEnergy Capital.

Former director and Secretary of the Alberta Performing
Arts Stabilization Fund
Jennings: Colombian Research Coverage
David Ricciardi

Prior to joining Jennings, David spent six years at Ross
Smith Energy Group Limited, the last two years as Vice
President of Finance

At Ross Smith David covered numerous exploration and
production companies operating in Canada and the
United States

Prior thereto, David spent over a year at Peters & Co.
Limited as an analyst in the corporate finance department
27

Alange Energy Corp.

Pacific Rubiales Energy

Canacol Energy Ltd.

Petrominerales Ltd.

Gran Tierra Energy Inc.

Suroco Energy Inc.
Case Study: Greystar Resources Ltd. (GSL: TSX)
Company Overview
Market Statistics
 Greystar Resources is a TSX and AIM-listed
exploration and development company focused on
developing its Angostura gold-silver project
 Greystar's main asset is the 100%-owned Angostura
gold-silver project located in northeastern Colombia
Exchange
TSX & AIM
Symbol
GSL
Share Price*
C$5.02
Shares Outstanding**
84 mm
o
450 km north of the capital city of Bogota
Market Capitalization**
C$420 mm
o
55 km north east of the city of Bucaramanga
Cash & Short-term Investments***
C$123 mm
Angostura Project
 Greystar is headquartered in Vancouver, Canada
with an operations office in Bucaramanga, Colombia
 Feasibility study completed, DFS under way
 Over 300,000 metres drilled
 Current Gold Resource: 11.5 million oz Measured
& Indicated, 3.5 million oz Inferred
 Current Silver Resource: 61.0 million oz Measured &
Indicated, 18.8 million oz Inferred
*As at June 16, 2010
**As at May 12, 2010
***As at March 31, 2010
Source: Greystar Resources Ltd., Bloomberg Financial Markets
28
Case Study: Greystar Resources Ltd (GSL: TSX)
Early, Consistent & Solid Support Capital Markets Support
Current Analyst Recommendations
FINANCINGS:
Nov 2004: Jennings Capital leads C$21.7 MM equity financing

Sept 2009: Jennings Capital leads C$63.2 MM equity financing
RESEARCH & TRADING:
 One of the first dealers to provide research early on
$10.00
 Consistent trading & after market support
Recommendation
Jennings Capital
RBC Capital Markets
McDougall
Curran
Speculative Buy
Sector Perform
$7.75
$6.50
Octagon Capital
Visagie
Buy
$8.60
Scotia Capital
Turnbull
Sector Perform
$6.00
BMO Capital Markets
Hayes
Market Perform
Canaccord Genuity
Campbell
Speculative Buy
10
$8.75
Loewen, Ondaatje, McCutcheon
Fowler
Speculative Buy
$8.30
In late April, the Ministry of the Environment, Housing and
Territorial Development (MAVDT) requested Greystar file a
new Environmental Impact Assessment (EIA) in regard to
the development of an open pit gold and silver mine at the
Angostura Project in Colombia
$8.00
Price (C$)
Analyst
$6.00
Target Price
NA
8
6
April 23rd close: C$6.50
April 27th close: C$3.60 ~ C$245 MM in shld. value wiped
$4.00
4
$2.00
2
$0.00
0
Jun-08
Aug-08
Nov-08
Jan-09
Apr-09
Jun-09
Volume
Source: Bloomberg Financial Markets
29
Aug-09
Price
Nov-09
Jan-10
Apr-10
Jun-10
Volume (millions)

Dealer
Partners in Growth
Daryl Hodges
(416) 304 2174
Simion Candrea
(416) 304 2186
Ricky Chan
(416) 304 3891
Mark Styles
(416) 304 3892
Michelle Hung
(416) 304 3893
30