TSX & NASDAQ: MPVD
Mountain Province – Investment Case
• World’s largest and richest new diamond mine • Partnered with De Beers • Projected top quartile operating margin • March 2017 – commercial production declared • Mid 2017 – full production achieved • Initial mine life 12 years • Potential for mine life extension • Vision: To be a Tier 1 asset: +20 year LOM, +$20
Billion in situ value
2 Q3 2017
Share Structure
• Markets: TSX & NASDAQ: MPVD
• Market cap: ~C$650M
• Shares outstanding: 160.2M
• Fully diluted: 163.1M
3 Q3 2017
Mine Location
4 Q3 2017
Gahcho Kué Mine
5 Q3 2017
Joint Venture with De Beers
• MPV 49% / De Beers 51%
• JV Board - 2 representatives each
• All material decisions by consensus
• Effectively 50/50 JV
• De Beers: mine operator
• Each markets their own share of diamonds
6 Q3 2017
2017 Production Guidance
2017 Full Year
Guidance
Original1
2017 H1
Actual
2017 Full Year
Guidance
Revised2
Ore Tonnes ‘000s (100% basis)
2,720 1,259 2,720
Grade (cts/t) 1.62 1.97 2.02
Total Cts ‘000s (100% basis)
4,400 2,481 5,500
MPV Cts ‘000s (49% basis)
2,200 1,216 2,700
7 Q3 2017
Price Guidance of US$70-$90 per carat, provided in Q2 2017 1. Original guidance provided in news release of April 25, 2017 entitled “Mountain Province Diamonds Production Report for the First
Quarter ended March 31, 2017” 2. Revised guidance provided in news release of August 9, 2017 entitled “Mountain Province Diamonds Announces June 30, 2017 Quarter
End Results”
Value Realization
8
Production Period3 Incept to EOY 2016
Q1
2017
Apr
2017
May 2017
Jun
2017
Jul
2017
Aug 2017
YTD Total 2017
Sale in Which Goods Were Primarily Sold 1-2 3-5 6 7 n/a2 n/a2 n/a2
Tonnes Processed (100%) (‘000s) 515 138 201 276 289 314 269 1,841
Recovered Grade (carats per tonne) 1.64 1.77 2.27 2.09 1.99 2.13 2.32 2.05
Carats Recovered (100%) (‘000s) 847 244 457 579 578 669 622 3,772
Carats Recovered (49% share) (‘000s) 422 120 224 284 283 328 305 1,848
Attributed Value per Tonne in CAD1 143 182 225 172 n/a2 n/a2 n/a2
1 Attributed Value per Tonne has been determined based on realized sale results, with any accelerated or deferred goods adjusted to their period of
production, reflecting only the Company’s 49% share of all diamonds including fancies and specials. 2 Not applicable as goods from this production period have not yet been sold. 3 Total figures may differ slightly from the sum of monthly figures due to the effects of rounding.
• Ore production rates have been strong • Diamond processing plant functioning at and above nameplate capacity • Total production costs to date broadly consistent with budget • Per-carat price realization impacted by: current rough market price levels; quality distribution
of 5034 pipe’s upper layer not yet representative of bulk sample results; market valuation of stone fluorescence; and price discovery process
• Partially mitigated by grade over-performance and weaker Canadian dollar
Q3 2017
Rough Diamond Price Index
9 Q3 2017
August 2014 Valuation
-20%
5034 Kimberlite – Six Lobes
10 Q3 2017
• Diamond distribution in North and East lobes variable by layer
• Three layers: upper transitional tuffisitic, middle transitional hypabyssal and lower hypabyssal (HK)
• Center lobe only HK
• Center and West lobe diamond distribution highly variable
5034 Bulk Sample
11 Q3 2017 Q3 2017
• Bulk samples taken from across the length, breadth and depth of 5034
• 1,957 carats from Center and East Lobes
• 1,132 carats from West Lobe
• Total: 3,089 carats
• 23.2 M ct Reserve
• Early diamond sales not yet representative of bulk sample results
Fluorescence
• Approx 1/3 of all natural diamonds fluoresce
• Fluorescence seen in bulk sample – limited to white colors (approx. 25% of bulk sample)
• “Blue fluorescence” only visible under black light. Under natural light fluorescing diamonds look brighter
• Fluorescence varies from faint to medium to very strong
• 9.9 carat 5034 C/E bulk sample diamond has strong fluorescence; 25 carat Tuzo diamond has faint fluorescence
• Market tolerance for fluorescence corresponds to strength of market. Weak diamond market = lower tolerance; strong diamond market = higher tolerance
• Pricing discounts from equivalent grade, but non-fluorescing, stones have generally ranged from 5% for faint to 35% for very strong fluorescence
• Marketing strategy is to maximize participation from buyers tolerant of fluorescent diamonds
• Target is to reduce fluorescence discount
12 Q3 2017
Fluorescence Under Black Light
13 Q3 2017
Very Strong Strong Medium Faint
Price Discovery Example
14 Q3 2017
Feasibility modeled price +$300/ct
CAD/USD
CAD down ~ 13% against feasibility assumption
15 Q3 2017
Feasibility assumption US$0.91
Product Profile in Early Production
16 Q3 2017
• Wide product variation
• Fancies and Specials <0.5% by weight and approx. 15% of value
• Gem and near gem 60% by weight and approx. 80% of value
• Industrial and boart 40% by weight and approx. 5% by value
• Significant population of large Special stones
• Multiple Special stones in recent sales achieved +$10,000/ct
Fancies and Specials
17 Q3 2017
• Less than 0.5% by volume but high value concentration
• Quality is variable – gem, near gem and boart
• Color is variable – white, grey, brown
• 9.9 ct stone from 5034 C/E bulk sample, “D” colour, valued at $18,500/ct.
• Sample large gem quality stones sold by MPVD to date include a 53.89 carat white gem and a 84.44 carat of off-white gem, and a 67.87 carat white gem
• 156 carat largest diamond to date, but boart
• No quality trend is evident yet
Sale Results
18
2017-Q1 Sales 1-3
2017-May Sale 4
2017-Jun Sale 5
2017-Jul Sale 6
2017-Sep Sale 7
Tender Sale Proceeds (USD million) 37.7 12.7 21.1 20.9 27.1
Carats Sold (‘000s) 522 148 222 290 463
Value per Carat (USD)1 72 86 95 72 59
Normalized Value per Carat (USD) 72 86 752 872 722
1 Diamonds sold at individual sale events will not directly reflect run-of-mine production from specific processing periods. The timing of the sale of some goods
may be accelerated or deferred for tactical marketing purposes. Realized average value per carat is also impacted by the binary nature of the fancies and specials
bidding process within each production split, conducted approximately every five weeks with the Company’s joint venture partner, De Beers Canada Inc. The
winning party of each fancies and specials bid then markets 100% of those diamonds. 2 Normalized to adjust for goods accelerated or deferred, and to include fancies and specials acquired through bid by De Beers Canada Inc.
Q3 2017
• Early sales weak due to Indian demonetization, market’s price discovery of a new production, and higher percentage of browns and lower quality Specials
• Indian demonitization impact largely dissipated by July • Price discovery impact now becoming reduced • General rough diamond market, particularly for Indian goods, currently weighed down by excess
polished inventories and financial weaknesses within the Indian cutting and polishing sector • Tender process functioning well – bids per lot consistently averaging between 10.4 and 11.4
since early sales, customer participation strong and steady, feedback is positive
Debt Service Schedule (US$) based on $357 million Loan
Year Principal + Interest Reserve Account
2017 50,461,000 178,900,000
2018 115,865,000 (28,600,000)
2019 115,968,000 (42,000,000)
2020 56,048,000 (74,000,000)
2021 68,650,000 (31,000,000)
2022 28,147,000 (3,300,000)
Total 435,139,000 -
Debt Service
19 Q3 2017
Status of Bank Waiver
• Requirement to fund cash call reserve accounts waived until November 30, 2017
• Draft updated Life of Mine Plan has been provided to Lenders for review
• Plan has been optimized following initial months of operations, will include impact of winterization improvements and 5034 east wall push-back, plus impact of positive grade experience to date
• Draft Plan undergoing detailed review by Lenders’ technical advisors and by Anglo Technical Services
• Detailed discussions with Lenders are ongoing as to restructuring alternatives
• Management’s top priority: achieve substantive agreement on a revised debt facility framework by end of waiver period
20 Q3 2017
Path to Tier 1 Asset
Phase Carats LOM
Phase 1: Reserve 55M 12 years
Phase 2: Resource 18.4M 5 years
Phase 3: Tuzo Deep ~12M ~3 years
Phase 4: Tesla & Other TBD* TBD*
Phase 5: New Targets TBD* TBD*
Vision: +20 years LOM, +$20B in-situ Value
*To be determined
21 Q3 2017
Phase 2 Development
Pipe Tonnes (Mt) (Inferred)
Grade (cpt) Carats (Mct)
5034 0.9 1.51 1.4
Tuzo 8.9 1.62 14.6
Hearne 1.4 1.67 2.4
Total 11.3 1.64 18.4
• Mine life potential from 12 to 17 years
22 Q3 2017
Phase 3: Tuzo Deep
Tuzo Deep Potential • ~7M tonnes • ~14M carats • Mine Potential:
17-20 years
23 Q3 2017
Diamond Engagement Ring Demand
24 Q3 2017
Percent of Brides Receiving Diamond Engagement Rings
Declining Diamond Supply
25 Q3 2017
Chart source: Figure 41, The Global Diamond Report - 2016, Bain & Company, Inc.
Corporate Information
Head Office
161 Bay Street Suite 1410
Toronto, ON M5J 2S1
Canada
Tel. +1 (416) 361-3562
www.mountainprovince.com
TSX & NASDAQ: MPVD
26 Q3 2017
Forward Looking Statements
27 Q3 2017
Caution Regarding Forward Looking Information
Cautionary Statement: This news release contains forward-looking statements under applicable Canadian and US securities regulations and legislation in which Mountain Province discusses its potential future performance. Forward-looking statements are all statements other than statements of historical facts, such as projections or expectations relating to ore grades and processing rates, production and sales volumes, cash costs, operating cash flows, capital expenditures, debt management initiatives, exploration efforts and results, development and production activities and costs, liquidity, tax rates, the impact of diamond price changes, reserve estimates, and future dividend payments. The words “anticipates,” “may,” “can,” “plans,” “believes,” “estimates,” “expects,” “projects,” “targets,” “intends,” “likely,” “will,” “should,” “to be”, “potential” and any similar expressions are intended to identify those assertions as forward-looking statements. Under its current project finance facility Mountain Province is not permitted to pay dividends on common stock unless and until obligations under the facility have been satisfied. The declaration of dividends is at the discretion of Mountain Province’s Board of Directors, subject to restrictions under the Company’s project finance facility, and will depend on Mountain Province’s financial results, cash requirements, future prospects, and other factors deemed relevant by the Board.
Mountain Province cautions readers that forward-looking statements are not guarantees of future performance and actual results may differ materially from those anticipated, projected or assumed in the forward-looking statements. Important factors that can cause Mountain Province’s actual results to differ materially from those anticipated in the forward-looking statements include supply of and demand for, and prices of, diamonds, mine commissioning, mining sequencing, production rates, cash flow, industry risks, regulatory changes, political risks, labor relations, weather- and climate-related risks, environmental risks and other risk factors.
Investors are cautioned that many of the assumptions upon which Mountain Province’s forward-looking statements are based are likely to change after the forward-looking statements are made, including for example diamond prices, which Mountain Province cannot control, and production volumes and costs, some aspects of which Mountain Province may not be able to control. Further, Mountain Province may make changes to its business plans that could affect its results. Mountain Province disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law. This presentation has been prepared under the supervision of Carl Verley, P. Geo., a Qualified Person under National Instrument 43-101.
28 Q3 2017
Appendices
Reserve Statement
Resource category: Probable reserve Source: JDS Mining, March 2014 (100% basis) * After depletion from mining in 2016
29 Q3 2017
Pipe Tonnes (Mt) Grade (cpt) Carats (Mct)
5034 12.9* 1.74 22.3*
Tuzo 16.4 1.25 20.6
Hearne 5.6 2.07 11.7
Total 34.9* 1.57 54.6*
Geological Model