mandalay resources corp. february 2015 presentation

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FEB 2015 BUILDING VALUE ACROSS THE CYCLE TSX // MND

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Page 1: Mandalay Resources Corp. February 2015 Presentation

FEB2015BUILDING VALUE

ACROSS THE CYCLE

TSX // MND

Page 2: Mandalay Resources Corp. February 2015 Presentation

This presentation contains "forward-looking statements" within the meaning of applicable securities laws, including statements relating to life of

mine production plans, exploration plans and the growth and strategy of Mandalay. Actual results and developments may differ materially from

those contemplated by these statements depending on, among other things: exploration results or production results not meeting management’s

expectations; capital, production and operating cost results not meeting current plans; and changes in commodity prices and general market and

economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A

description of additional risks that could result in actual results and developments differing from those contemplated by forward looking

statements in this news release can be found under the heading “Risk Factors” in Mandalay’s annual information form dated March 28, 2014 and

in its final prospectus dated September 2, 2014, copies of which are available under Mandalay's profile at www.sedar.com. Although Mandalay

has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-

looking statements, 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 statements will prove to be accurate, as actual results and future events could differ materially from those

anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

Quality Control and AssuranceQuality control and assurance programs are implemented in line with the standards of National Instrument 43-101.

The exploration program at Costerfield is supervised by Chris Gregory (Member, Australian Institute of Geoscientists accredited Chartered

Professional (Mining)), General Manager of Australasian Business Development for Mandalay and a Qualified Person as defined under National

Instrument 43-101. Mr. Gregory regularly visits Costerfield, supervises the collection and interpretation of scientific and technical information

contained in this presentation.

The exploration programs on the Cerro Bayo and La Quebrada projects are supervised by Ronald Luethe (Member: American Institute of

Professional Geologists and an Idaho Registered Professional Geologist), General Manager of Mandalay Chile Ltda. and a Qualified Person as

defined under National Instrument 43-101. Mr. Luethe visits the Cerro Bayo and La Quebrada projects often, supervises the collection and

interpretation of scientific and technical information contained in this presentation.

Dr. Mark Sander (Member: AusIMM), President of Mandalay, has visited the Costerfield, Cerro Bayo, and La Quebrada projects several times

during 2010, 2011, 2012 and 2013 and has supervised the preparation of this presentation. He has also visited the Challacollo project in 2013

and 2014.

All currency references in US$ unless otherwise indicated

Forward-looking Statements

2

Page 3: Mandalay Resources Corp. February 2015 Presentation

15,854 63,351

107,941 126,908

253,796

520,175 633,000

771,500

1,123,367

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

0

50,000

100,000

150,000

200,000

250,000

300,000

2010 2011 2012 2013 2014 2015

Oz A

u E

q.

Ye

ar-

En

d

Res

erv

es

Oz A

u E

q.

An

nu

al

P

rod

uc

tio

n2009

• Costerfield, Australia

• Gold & Antimony

2010• Cerro Bayo, Chile

• Silver & Gold

2013

• Challacollo, Chile

• Silver & Gold

2014

• Björkdal, Sweden

• Gold

$3.2 $11.1 $9.5$20.6

$92.2

$171.8 $166.9$184.6

$1.7

$32.0

$79.9$67.7 $64.4

0

50

100

150

200

2010 2011 2012 2013 2014

US

$ M

M

A Profitable, Dividend-Paying Company (5.2% Yield*)

3

We create exceptional shareholder value through the acquisition of undervalued assets that can rapidly

become cash generative, self fund exploration, establish and maintain high operating margins and

return cash to shareholders within a planned period of time. Mandalay is committed to operating safely

and in an environmentally responsible manner, while developing a high level of community and

employee engagement.

(1)The Company defines EBITDA as earnings before interest, taxes and non cash charges/ (income). EBITDA should not be considered by an investor as an alternative to net income

or cash flow as determined in accordance with IFRS.(2)Annual cash dividend paid quarterly, based on 6% of the Company’s trailing quarter’s gross revenue and the future cash requirements of the Company(3) Refer to notes on Mineral Reserves in the Appendix, (4) Price assumptions for gold eq. oz were based on each year’s price calculated in the Mineral Reserves table. 2014 reserve

prices used were $1,200 Au, $20 Ag and $10,000 Sb * Yield is quarterly dividend divided by the share price on day of announcement ($0.92) and annualized.

TIMELINE

Production &

Reserves

Revenue,

EBITDA &

Dividends

Revenue

EBITDA

Dividends

Reserves

Production

154,810

167,000 –

185,000 E

Page 4: Mandalay Resources Corp. February 2015 Presentation

50%

100%

150%

200%

250%

300%

Q3

20

09

Q4

20

09

Q1

20

10

Q2

20

10

Q3

20

10

Q4

20

10

Q1

20

11

Q2

20

11

Q3

20

11

Q4

20

11

Q1

20

12

Q2

20

12

Q3

20

12

Q4

20

12

Q1

20

13

Q2

20

13

Q3

20

13

Q4

20

13

Q1

20

14

Q2

20

14

Q3

20

14

Q4

20

14Cu

mu

lati

ve %

Val

ue

Ch

ange

Sin

ce Q

3 2

00

9

Mandalay Cumulative Returns 16.5% Annual Compounded Rate of Return Gold Silver

4

16.5% Compounded Cumulative Total Shareholder Return through Entire Bottom-to-Bottom Price Cycle

MND LAG MND OUTPERFORM

CE

O A

ppoin

ted

Coste

rfie

ld A

cquired

Single

mine

ramp-up

Cerr

o B

ayo

Acquired

Two mine

ramp-up

SIB

Warr

ant

Redem

ption

Div

idend

Begun

Challa

collo

Acquired

$60 m

illio

n g

old

loan

Bjö

rkdal A

cquired

WF

Sale

Page 5: Mandalay Resources Corp. February 2015 Presentation

(1) Exercise price: C$0.26 - C$1.13; Expiry date: Aug 26, 2015 - Nov 06, 2019(2) As of January 09, 2015, the directors and executive officers of the Corporation, as a group, beneficially owned, or controlled or directed, directly or indirectly, approximately

125,942,726 Common Shares, representing approximately 31% of the outstanding Common Shares(3) Using exchange rate of 1CAD: 0.81 USD

Capital Structure and Ownership

5

Major Shareholders(2)

Holders % Shares (Million)

West Face Capital 22.3% 91.0

Sentry Investments 10.1% 41.4

Plinian + Management 8.3% 33.9

Sprott Asset Management 7.9% 32.3

Resolute Funds 3.7% 15.2

Baker Steel Capital Managers 3.7% 15.0

GMT Capital 3.1% 12.5

Shares, options, and warrants as at Feb 17, 2015Millions

(Except Share Price Information)

Share price (Feb 17, 2015 - close) (C$) 0.92/shr

Shares Outstanding 408.8

Options(1) 17.0

Fully Diluted Shares Outstanding 426.0

Market Capitalization (C$) 376.0

Cash and Cash Equivalents (US$) 49.0

Total Debt (US$) 60.0

Total Enterprise Value (US$) 314.5

Page 6: Mandalay Resources Corp. February 2015 Presentation

Operational Locations and Tradeflows

6

Mining friendly operational jurisdictions with strong and diversified customer base

Page 7: Mandalay Resources Corp. February 2015 Presentation

(1) Refer to notes on Mineral Resources and Mineral Reserves in the Appendix

(2) La Quebrada Resources removed for 2014; La Quebrada is now classified as Asset Held for Sale7

15,854 63,351

107,941 126,908

253,796

520,175 633,000

771,500

1,123,367

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

0

50,000

100,000

150,000

200,000

250,000

300,000

2010 2011 2012 2013 2014 2015

Oz A

u E

q.

Ye

ar-

En

d

Res

erv

es

Oz A

u E

q.

An

nu

al

P

rod

uc

tio

n

7

Reserves

Production

154,810

167,000 –

185,000 EGrowing Reserves & Mine Life

Costerfield M&I Resource Additions & Depletion (Au Eq oz)

Bjorkdal M&I Resource Additions & Depletion (Au oz) Cerro Bayo M&I Resource Additions & Depletion (Ag oz)

Challacollo M&I Resource Additions & Depletion (Ag oz)

Page 8: Mandalay Resources Corp. February 2015 Presentation

Strong Annual Production Growth

8

109,337

1,318,655

2,911,595 3,145,537

3,329,519

0500,000

1,000,0001,500,0002,000,0002,500,0003,000,0003,500,000

2010 2011 2012 2013 2014 2015E

Silver (oz)

334

12,244

17,089

21,482

27,600

0

5,000

10,000

15,000

20,000

25,000

30,000

2010 2011 2012 2013 2014 2015E

Gold (oz)

7,661 6,678

18,036

28,758

35,751

0

10,000

20,000

30,000

40,000

2010 2011 2012 2013 2014 2015E

Gold (oz)Costerfield Production(2015E)

Cerro Bayo Production(2015E)

1,106

1,571

2,481

3,275

3,639

0

1,000

2,000

3,000

4,000

2010 2011 2012 2013 2014 2015E

Antimony (Sb)

Björkdal Production(2015E)

14,549

0

10,000

20,000

30,000

40,000

50,000

60,000

2010 2011 2012 2013 2014 2015E

Gold (oz)

15,854

63,351

107,941126,908

154,810

0

40,000

80,000

120,000

160,000

200,000

2010 2011 2012 2013 2014 2015E

Total MND Production (AuEq oz)

Refer to notes on gold equivalent ounces in the Appendix

167,000 - 185,000

32,000 –

37,000

23,000 –

27,000

46,000 -

52,000

3,200 –

3,500

2,700,000 –

3,100,000

Page 9: Mandalay Resources Corp. February 2015 Presentation

Current Financial Performance (Q4 2014)

9

Current Operational Performance (Q4 2014)

Q4, 2014 2014YE Q4, 2013 2013YE

Saleable Silver oz produced 1,021,189 3,329,519 878,542 3,145,537

Saleable Gold oz produced 31,636 77,900 12,117 50,240

Saleable Antimony t produced 926 3,639 805 3,275

Q4, 2014 2014YE Q4, 2013 2013YE

Net Cash/All-in Cost/oz Ag at Cerro Bayo, $ 3.95 / 10.37 5.30 / 11.36 6.74 /11.51 6.84 / 12.07

Net Cash/All-in Cost/oz Au Eq. at

Costerfield, $

608 / 884 771 / 1,035 850 / 1,085 819 / 1,062

Net Cash/All-in Cost/oz Au Eq. at

Björkdal, $(1)

901 / 1,051(1) 870 / 1,023 - -

EBITDA, $ million 21.5 64.4 13.9 67.7

Net Income, $ million 7.3 17.2 4.4 29.4

Cash and cash equiv., $ million 49.0 49.0 33.5 33.5

Current Mandalay Performance

(1) For the period September 10, 2014 to December 31, 2014

Page 10: Mandalay Resources Corp. February 2015 Presentation

10

Total Cerro Bayo Costerfield Björkdal

Saleable gold

production (oz)

101,000 – 116,000 23,000 – 27,000 32,000 – 37,000 46,000 – 52,000

Saleable silver

production (million oz)

2.7 – 3.1 2.7 – 3.1 -- --

Saleable antimony

production (t)

3,200 – 3,500 -- 3,200 – 3,500 --

Gold equivalent

production (oz)

167,000 – 185,000 -- -- --

Cash cost $/oz silver

net by-product

-- 6.00 – 8.00 -- --

Cash cost $/oz gold or

gold equivalent

-- -- 625 – 750 850 – 950

Capital expenditure

($ million)

38 – 44 12 – 14 16 – 18 10 – 12

Exploration ($ million) 7 3 1 3

Mandalay 2015 Production and Cost Guidance

Page 11: Mandalay Resources Corp. February 2015 Presentation

Björkdal Gold Mine: Overview

11

Land package 6,862 hectares

Ownership 100%

2014 gold production 14,549 oz (attributed to Mandalay)

2015E gold production 46,000 – 52,000 oz

P&P Reserves(1) 6.5 Mt @ 2.05 g/t Au (432,000 oz Au)

Plant recoveries(2) Au: 88%

2015E cash costs Au / 2014A(2) $850 - $950 / $870

1 Refer to notes on reserves in the Appendix2 From September 10, 2014 to December 31, 2014

2015 Planned Exploration

Budget $3 million

Page 12: Mandalay Resources Corp. February 2015 Presentation

Björkdal Value Creation Plan

12

Goal: Allow for a

revised mine plan

that improves

planned delivered

grades from mine to

mill, so more gold will

be produced from the

current capacities,

resulting in an

expected decrease in

cost per ounce

Produce a more

refined resource

model to support

more selective

underground &

open pit mining

techniques

Goal: Margin

expansion by

producing more gold

at reduced cost per

ounce from the same,

largely fixed-cost

operation. Optimized

mill feed grade

expected to improve

recoveries

Increase grade of

mill feed through

selective mining

and “ore sorting”

technologies

Goal: Extend

mineralization along

strike and down dip

by increasing the rate

of infill drilling on

currently defined

Inferred Mineral

Resources

Increase funding for

exploration

Introduce best

practice mapping,

drilling, sampling,

and modelling of

high nugget-effect

gold deposits

Goal: Provide factual

basis for more selective

mining to increase mill

grades; will also reduce

total exploration cost by

accelerating wide-spaced

and infill drilling while

reducing the expensive

practice of exploration by

large-scale drifting across

and on veins

Timeline

Q1 2015 - COMPLETE Q2 2015 2016 2016

Page 13: Mandalay Resources Corp. February 2015 Presentation

Björkdal – Emerging new thinking – Au “skarn”

N

5 km

Björkdal

mine

Granodiorite

instrusion

‘Marble’

Volcaniclastic

Rocks

Mafic intrusion

Volcanic Rocks

Sedimentary

succession

(mudstones and

sandstones)

B

B’A

A’

13

Page 14: Mandalay Resources Corp. February 2015 Presentation

Cerro Bayo Silver-Gold Mine

14

Land package 23,106 hectares

Ownership 100%

2014 silver production 3,329,519 oz

2014 gold production 27,600 oz

2015E silver production 2.7 – 3.1 Moz

2015E gold production 23,000 – 27,000 oz

P&P Reserves 2.4 Mt @ 220 g/t Ag; 2.13 g/t Au

Plant recoveries (Q4 2014) Ag: 92.34%, Au: 89.96%

2015E cash costs/oz Ag net Au credits / 2014A $6.00 - $8.00 / $5.30

2015 Planned Exploration

Budget $3 million

Page 15: Mandalay Resources Corp. February 2015 Presentation

Cerro Bayo Operating Performance

15

$0

$20

$40

$60

$80

0

50,000

100,000

150,000

Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-2013

Q4-2013

Q2-2014

Q4-2014

$/

Ton

ne

Ton

ne

s P

er Q

ua

rter

Mining Rate and Unit Cost

t Mined Cost/ t Mined

$0

$20

$40

$60

0

50,000

100,000

150,000

Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14

$/

Ton

ne

Ton

ne

s P

er

Qu

arte

r

Processing Rate and Unit Cost

t Processed Cost/ t Processed

$0

$5

$10

$15

$20

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Q4-10

Q2-11

Q4-11

Q2-12

Q4-12

Q2-13

Q4-13

Q2-14

Q4-14

$/

oz

Ag

Ne

t B

ypro

du

ct

Ou

nce

s Si

lve

r P

er

Qu

arte

r

Saleable Silver Produced & Unit Cost

Ag oz Cost/ oz Ag net Au

Page 16: Mandalay Resources Corp. February 2015 Presentation

LAGUNA VERDE

Emerging Extensions and New Veins Under Laguna Verde

16

COYITA

Yasna

COYITA

YASNA

Inferred

Inferred

Indicated

Indicated

Reserve

Limits

Reserve

Limits

Slow drilling of long holes under lake

Coyita and Yasna only partially

infilled/extended in 2014– 3.4 Moz

added in reserves

We expect at least as much again as

we complete drilling

Page 17: Mandalay Resources Corp. February 2015 Presentation

Costerfield Gold-Antimony Mine: Overview

17

2015 Planned Exploration

Budget $1 million

Land package 1,293 hectares

Ownership 100%

2014 gold production 35,751 oz

2014 antimony production 3,639 t

2015E gold production 32,000 – 37,000 oz

2015E antimony production 3,200 – 3,500 t

Current throughput 400 tpd

P&P Reserves 430,000 tonnes @ 8.1 g/t Au; 3.6% Sb

Plant recoveries (Q4 2014) Au: 90.98%, Sb: 94.76%

2015E Cash cost/oz Au Eq. / 2014A $625 - $750 / $771

Page 18: Mandalay Resources Corp. February 2015 Presentation

Costerfield Operating Performance

18

$0

$100

$200

$300

$400

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,000

Q4-09(Dec.only)

Q2-10 Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14

USD

/ To

nn

e

Ton

nes

Pe

r Q

uar

ter

Mining Rate and Unit Cost

t Mined Cost/ t Mined

$0

$20

$40

$60

$80

$100

$120

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Q4-09(Dec.only)

Q2-10 Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14

USD

/ To

nn

e

Ton

ne

s P

er

Qu

arte

r

Processing Rate and Unit Cost

t Processed Cost/ t Processed

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

02,0004,0006,0008,000

10,00012,00014,00016,00018,00020,000

USD

/ O

z A

u E

q.

Ou

nce

s P

er

Qu

arte

r

Au Equivalent Production and Cost

Oz Au Eq. Cost/ Au Eq. Oz

Page 19: Mandalay Resources Corp. February 2015 Presentation

Near-mine expansion – “Western Corridor”

Untested potential to the west of current mining operations between major

regional faults and below the King Cobra Fault.

Untested potential in

King Cobra-Adder

Corridor

Potential below King Cobra

(one intercept so far)

Approx.

Intended

Drill

Holes

Approx.

Intended

Drill

Holes

19

Page 20: Mandalay Resources Corp. February 2015 Presentation

Challacollo Silver-Gold Project: Overview

20

Land package 20,378 hectares

Ownership 100%

Location 130 km SE of Iquique, Chile

Mineralization Epithermal, oxidized Ag-Au

Elevation approx. 1,500 metres ASL

Resource Indicated: 4.7 mt @ 200 g/t Ag;

Inferred: 1.6 mt @134 g/t Ag

Page 21: Mandalay Resources Corp. February 2015 Presentation

21

Lolon Vein– Inferred potential remainingto infill + open on strike and at depth

Short Hole

200 m

Fault Gap

OPEN

OPEN

OPEN

Page 22: Mandalay Resources Corp. February 2015 Presentation

MND (235% value change) outperformed through the entire 2009 - 2014 bottom-to-bottom price cycle:

• Entire set of Currencies (83 – 110%)

• Entire set of Precious Metals (94 – 120%)

• Entire set of Base Metals (81 – 113%)

• Entire Big Diversified category (58 – 130%)

• Entire Prospect Generator category (47 – 220%)

• Entire Royalty/Streaming category (84 – 196%)

• Entire Gold Mutual Fund category (65 – 77%)

• Entire Resource Mutual Fund category (105 – 184%)

• Entire Mega Gold category (35 – 53%)

• All but 1 Big Gold company (15 – 247%)

• All but 3 Mid Tier Gold companies (26 – 4,064%)

• Entire set of Junior Gold companies (25 – 163%)

• All but 2 Gold Development companies (12 – 643%)

• All but 1 Big Silver company (25 – 323%)

• Entire Mid Tier Silver category (33 – 85%)

• Entire set of Junior silver producers (33 – 93%)

• Entire set of Silver Developers (4 – 153%)

• Entire set of Big Copper companies (83 – 195%)

• Entire set of Mid-Tier Base Metals companies (14 – 211%)

• Entire set of Base Metals developers (16 – 89%)

• Entire PGM space (5 – 219%)

22

Mandalay versus:

• 126 alternative investments

• In 21 different strategy

categories

• Over the 22 quarters from

Q3 2009 to Q4 2014 (period

that Plinian has led

Mandalay)

Value metric is:

• Common shareholder equity

value assuming market

purchase of shares,

excluding warrants and

special dividends but

including ordinary dividends

and stock splits

Page 23: Mandalay Resources Corp. February 2015 Presentation

0

5

10

15

20

25

30

35

40

45

50

Nu

mb

er

of

Alt

ern

ativ

es

Cumulative Total Value Q3 2009 – Q4 2014

23

Long-Term performance – Mandalay at About the 95th

Percentile of Value Generators Over Five-Year Period

7 Outperformed MND

95th percentile: 240%

83 of 126 LOST value

Median: 76% (lost value)

Mean: 138% (gained value)

Mandalay return: 235%

Page 24: Mandalay Resources Corp. February 2015 Presentation

24

What we do for you when you invest with us

Acquire new assets countercyclically-- only at a deep discount to value that we can deliver

• Base case returns at least 2X the investment

• Upside case 3-5X over 3-5 years based on specific testable hypotheses

• If we do not see any deep discounts, then acquire nothing

Execute focused improvement projects at each site

• Exploration – portfolio targeted on discovery of near-term reserves

• Mining – projects focused on safer, more mechanised mining with higher extraction,

lower dilution and reduced cost

• Metallurgical – projects focused on higher recovery, higher availability, higher quality

products with higher payables and reduced costs

• Commercial – create more diverse customers paying better terms

Relentless, tight financial management

• Low cash cost for high EBITDA margins

• Low DD&A for high P&L margins

• Prudent, low-cost leverage to fund growth when needed

• Stingy with new equity at all times

• Return cash to shareholders – dividends = 6% of trailing qtr. revenues

Page 25: Mandalay Resources Corp. February 2015 Presentation

FEB2015BUILDING VALUE

ACROSS THE CYCLE

TSX // MND

For more information, please contact:

Greg DiTomaso

Director, Investor Relations

Tel: 647.260.1566

Email: [email protected]

Company Website: www.mandalayresources.com

Twitter: @MandalayAuAg

Page 26: Mandalay Resources Corp. February 2015 Presentation

26

Management and Board of Directors

Senior Management

Board of Directors

Brad Mills, CEO and

Executive Director

Former CEO Lonmin

plc, over 30 years of

experience in Copper,

Gold, PGMs

Mark Sander, President

28 years of experience in

exploration, strategy and

operating improvements

Sanjay Swarup, CFO

and Executive Director

Former Lonmin plc, over

20 years of industry

experience

Belinda Labatte,

Head of Stakeholder

Engagement & Corporate

Affairs

Over 10 years of experience

in capital markets

Braam Jonker,

Chairman

Peter R. Jones,

Independent Director

Tony Griffin,

Independent Director

Robert Doyle,

Independent Director

Dominic Duffy, COO

Mining Engineer with

extensive technical and

operational management

experience

Page 27: Mandalay Resources Corp. February 2015 Presentation

Numbers may differ slightly from source documents due to rounding 27

Mandalay Reserves

Cerro Bayo Reserves (1) Ore (t) Ag Grade (g/t) Ag (cont. oz) Au Grade (g/t) Au (cont. oz)

Proven Reserves 374,000 209 2,513,000 1.7 21,000

Probable Reserves 2,035,000 222 14,549,000 2.2 144,000

P&P Reserves 2,409,000 220 17,062,000 2.13 165,000

Costerfield Reserves (2) Ore (t) Sb Grade (%) Sb (cont. t) Au Grade (g/t) Au (cont. oz)

Proven Reserves 98,000 4.5 4,400 10.4 32,000

Probable Reserves 333,000 3.3 11,200 7.4 80,000

P&P Reserves 431,000 3.6 15,600 8.1 112,000

Bjorkdal Open-Pit

Reserves(3)Ore (t)

Grade

(g/t)Ounces

Proven - - -

Probable 2,556,000 1.25 103,000

Total 2,556,000 1.25 103,000

Bjorkdal Underground

Reserves(3)

Ore (t) Grade

(g/t)

Ounces

Proven - - -

Probable 2,988,000 3.26 313,000

Total 2,988,000 3.26 313,000

1 Source: Cerro Bayo - Roscoe Postle Associates, Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 20152 Source: Costerfield - SRK Consulting (Australia), Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 20153 Source: Björkdal – Roscoe Postle Associates, Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 2015

TOTAL RESERVES

31-December-2014Ag (cont. oz) Au (cont. oz) Sb (cont. t)

Mandalay Proven Reserves 2,513,000 53,000 4,400

Mandalay Probable Reserves 14,549,000 656,000 11,200

Total Mandalay P&P Reserves 17,062,000 709,000 15,600

Bjorkdal Stockpile

Reserves(3)

Ore (t) Grade

(g/t)

Ounces

Proven - - -

Probable 1,000,000 0.5 16,000

Total 1,000,000 0.5 16,000

Page 28: Mandalay Resources Corp. February 2015 Presentation

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Mandalay ResourcesCerro Bayo Resources (1) Resource (t) Ag Grade (g/t) Ag (cont. oz) Au Grade (g/t) Au (cont. oz)

Measured Resources 310,000 316 3,143,000 2.6 26,000

Indicated Resources 1,685,000 323 17,525,000 3.2 178,000

M&I Resources 1,995,000 322 20,668,000 3.2 204,000

Inferred Resources 585,000 218 4,112,000 2.2 43,000

Costerfield Resources (2) Resource (t) Sb Grade (%) Sb (cont. t) Au Grade (g/t) Au (cont. oz)

Measured Resources 213,000 4.5% 9,600 10.2 70,000

Indicated Resources 786,000 3.3% 26,300 6.9 175,000

M&I Resources 999,000 3.6% 35,900 7.5 245,000

Inferred Resources 519,000 2.6% 13,700 5.3 89,000

TOTAL RESOURCES Ag (cont. oz) Au (cont. oz) Sb (cont. t)Measured Resources 3,143,000 96,000 9,600

Indicated Resources 47,725,000 1,039,000 26,300

Total M&I Resources 50,868,000 1,135,000 35,900

Total Inferred Resources 11,003,000 221,000 13,700

1 Source: Cerro Bayo - Roscoe Postle Associates, Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 20152 Source: Costerfield - SRK Consulting (Australia), Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 2015

Challacollo Resources (3) Resource (t) Au Grade (g/t) Ag Grade (g/t) Au (cont. oz) Ag (cont. oz)Measured Resources - - - - -

Indicated Resources 4,700,000 0.3 200 48,000 30,200,000

M&I Resources 4,700,000 0.3 200 48,000 30,200,000

Inferred Resources 1,600,000 0.3 134 16,000 6,900,000

3 Source: Challacollo – Roscoe Postle Associates, Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 2015

4 Source: Björkdal – Roscoe Postle Associates, Effective December 31, 2014, documented in an independent NI 43-101 report to be filed within 45 days of Feb 17, 2015

Björkdal Resources(4) Measured Au

(cont. oz)

Indicated Au

(cont. oz)

Measured + Indicated

Au (cont. oz)

Inferred Au

(cont. oz)

Open Pit - 132,000 132,000 29,000

Underground - 490,000 490,000 44,000

Stockpile - 16,000 16,000 -

Totals - 638,000 638,000 73,000