Pasinex Corporate Presentation

High Grade Zinc: Production, Exploration and Opportunity

Corporate Presentation July 2018

Disclaimer T h e in fo rm a tio n co n ta in e d in th is p re s e n ta tio n is p ro vid e d b y P a sin e x R e so u rce s L im ite d . (“P a sin e x ”) fo r in fo rm a tio n a l p u rp o se s o n ly a n d d o e s n o t co n stitu te a n o ffe r to iss u e o r a rra n g e to issu e , o r th e so licita tio n o f a n o ffe r to issu e , se cu ritie s o f P a sin e x o r o th e r fin a n cia l p ro d u c ts . T h e in fo rm a tio n c o n ta in e d h e re in is n o t in ve stm e n t o r fin a n cia l p ro d u ct a d vice a n d is n o t in te n d e d to b e u se d a s th e b a sis fo r m a k in g a n in ve stm e n t d e c isio n . T h e vie w s, o p in io n s a n d a d vice p ro vid e d in th is p re se n ta tio n re fle ct th o se o f th e in d ivid u a l p re se n te rs , a n d a re p ro v id e d fo r in fo rm a tio n p u rp o se s o n ly . T h e p re se n ta tio n h a s b e e n p re p a re d w ith o u t ta k in g in to a cco u n t th e in v e stm e n t o b je ctiv e s , fin a n c ia l s itu a tio n o r p a rticu la r n e e d s o f a n y p a rticu la r p e rso n . N o re p re s e n ta tio n o r w a rra n ty , e xp re s s o r im p lie d , is m a d e a s to th e fa irn e ss, a ccu ra cy, co m p le te n e ss o r co rre ctn e ss o f th e in fo rm a tio n , o p in io n s a n d co n c lu sio n s co n ta in e d in th is p re s e n ta tio n . T o th e m a xim u m e xte n t p e rm itte d b y la w , n o n e o f P a sin e x n o r its d ire c to rs o ffice rs, e m p lo ye e s o r a g e n ts , n o r a n y o th e r p e rs o n a c ce p ts a n y lia b ility, in clu d in g , w ith o u t lim ita tio n , a n y lia b ility a risin g o u t o f fa u lt o r n e g lig e n ce , fo r a n y lo ss a ris in g fro m th e u s e o f th e in fo rm a tio n co n ta in e d in th is p re se n ta tio n . E xce p t fo r sta te m e n ts o f h is to rica l fa c t, th is p re se n ta tio n c o n ta in s c e rta in “fo rw a rd -lo o kin g in fo rm a tio n ” w ith in th e m e a n in g o f a p p lica b le se cu ritie s la w s . F o rw a rd lo o kin g in fo rm a tio n is fre q u e n tly c h a ra cte riz e d b y w o rd s su ch a s “p la n ”, “e xp e ct”, “p ro je ct”, “in te n d ”, “b e lie v e ”, “a n ticip a te ”, “e stim a te ” a n d o th e r s im ila r w o rd s , o r s ta te m e n ts th a t ce rta in e ve n ts o r co n d itio n s “m a y” o r “w ill” o cc u r. F o rw a rd -lo o kin g sta te m e n ts a re b a se d o n th e o p in io n s a n d e s tim a te s o f m a n a g e m e n t a t th e d a te th e sta te m e n ts a re m a d e , a n d a re su b je ct to a va rie ty o f risks a n d u n c e rta in tie s a n d o th e r fa c to rs th a t co u ld ca u se a ctu a l e ve n ts o r re su lts to d iffe r m a te ria lly fro m th o se a n ticip a te d in th e fo rw a rd -lo o kin g s ta te m e n ts, in clu d in g , a m o n g o th e rs, th e a ccu ra cy o f m in e ra l g ra d e s a n d re la te d a ssu m p tio n s, p la n n e d e xp e n d itu re s , p ro p o s e d e x p lo ra tio n a n d d e ve lo p m e n t a t th e G o lcu k C o p p e r/S ilve r P ro je ct, th e H o rz u m Z in c /L e a d P ro je c t a n d th e D a d a k C o p p e r / G o ld P ro je c t. P a sin e x u n d e rta ke s n o o b lig a tio n to u p d a te fo rw a rd -lo o kin g in fo rm a tio n if circ u m s ta n c e s o r m a n a g e m e n t’s e stim a te s o r o p in io n s s h o u ld c h a n g e e xce p t a s re q u ire d b y la w . T h e re a d e r is ca u tio n e d n o t to p la ce u n d u e re lia n ce o n fo rw a rd -lo o kin g s ta te m e n ts . T h is p re se n ta tio n in c lu d e s in d u s try , m a rk e t a n d co m p e titive p o sitio n d a ta fro m in d u stry jo u rn a ls a n d p u b lic a tio n s, d a ta o n w e b site s m a in ta in e d b y p riv a te a n d p u b lic e n titie s, in clu d in g in d e p e n d e n t in d u stry a sso cia tio n s, g e n e ra l p u b lic a tio n s a n d o th e r p u b licly a va ila b le in fo rm a tio n . P a sin e x b e lie v e s th a t a ll o f th e se so u rce s a re re lia b le , b u t w e h a ve n o t in d e p e n d e n tly ve rifie d a n y o f th is in fo rm a tio n a n d c a n n o t g u a ra n te e its a c cu ra cy o r co m p le te n e ss . In d u stry p u b lica tio n s a n d su rve ys g e n e ra lly sta te th a t th e y h a v e o b ta in e d in fo rm a tio n fro m s o u rce s b e lie v e d to b e re lia b le , b u t d o n o t g u a ra n te e th e a ccu ra cy a n d co m p le te n e ss o f su ch in fo rm a tio n . F u rth e r, b e c a u s e c e rta in o f th e s e o rg a n iza tio n s a re in d u stry o rg a n iza tio n s, th e y m a y p re se n t in fo rm a tio n in a m a n n e r th a t is m o re fa v o ra b le to th e in d u stry th a n w o u ld b e p re se n te d b y a n in d e p e n d e n t so u rce . In a d d itio n , fo re c a s ts a re o fte n in a ccu ra te , e sp e cia lly o v e r lo n g p e rio d s o f tim e . R e fe re n ce s in th is p re se n ta tio n to re se a rch re p o rts o r a rticle s sh o u ld n o t b e co n s tru e d a s d e p ictin g th e c o m p le te fin d in g s o f th e e n tire re fe re n ce d re p o rt o r a rticle . T h e in fo rm a tio n in e a ch re p o rt o r a rtic le is n o t in c o rp o ra te d b y re fe re n ce in to th is p re se n ta tio n .

Pasinex Resources Limited | CSE: PSE | FSE: PNX 2

Zinc Production & Exploration in Turkey and the US

UNITED STATES

High Grade Zinc Carbonate Production & Exploration at Pinargozu Zinc Mine, Turkey 50/50 JV TURKEY

NEVADA

High Grade Zinc Carbonate Exploration Project Gunman, White Pine County, Nevada 80% Earn In over 4 years

Pasinex Resources Ltd. is active on Zinc Projects on two continents


Pasinex Corporate Profile Capital Structure CSE:PSE; FSE:PNX Shares Issued and Outstanding Share Price (July 1 st, 2018) Market Capitalisation

142,154,371 $ 0.120 $ 17 M

Warrants Options

None 5.35 M

Shareholders 20% Directors & Managem ent

Other Top 20 Shareholders

45% 35%

Other Shareholders


Pasinex Management & Board Steve Williams

Wendy Kaufman

John Barry

President & CEO

CFO

VP. Exploration & Board Member

Metallurgy degree and MBA, Mines in Australia and Canada, 20 years with SGS in Metallurgy, Past Managing Director SGS Canada

Chartered Professional Accountant with 20 years of international financial experience in mining. Formerly CFO at Primero and VP Finance at Inmet Mining Corp

Master’s Degree in Geology from Pennsylvania State University, MBA from the Edinburgh School of Business, Experienced Zn geologist Ex-CEO Rathdowney Resources

Evan White

Dr. Larry Seeley

Vic Wells

Manager, Corporate Communications

Board Member

Board Chairman

11 years in marketing in the mining sector

Ex-VP Falconbridge Mining, Ex-President Lakefield Research

Financial expert was CFO / Director for a number of junior exploration companies

Sven Olsson

Joachim Rainer

Jonathan Challis

Board Member 15 years in capital raising & IR for junior companies

Board Member 20 years in entrepreneurial finance in Austria

Board Member Mining engineer with many Directorships and senior roles with juniors

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A Growing Pure Play Zinc Company v Pasinex is active in Turkey and in the US v Mid-term goal is to move Pasinex from Junior to MidTier (market capitalization from around $18M CAD to $100M+ CAD) v Pasinex owns 50% of a exceptional high grade zinc mine near Adana, Turkey, called Pinargozu v Produced 40,000,000 lbs of Zinc in 2017 / also projected for 2018 v Maiden NI 43-101 resource is completed shows three year runway at current production rate v Expanding Pinargozu through exploration v District & regional exploration opportunity in a world class zinc district in Turkey 35%


Pinargozu Mine a Company Maker v High Profit margins (81% in Q1 2018 in Horzum A.S. JV) v First Dividend of $1.2 M received in 2017. v Selling Direct-Shipping “natural concentrate” on spot (no long term contracts) v Able to capitalize on high zinc prices v Producing mine with ultra high grade zinc v 32% zinc in the Oxides v 48% zinc in the Sulphides v Pinargozu is a new discovery made in 2013 v Exploration underway to expand the resource v Growing expertise in recognizing other high-grade zinc properties like Pinargozu v Turkish JV-Partner with strong operational experience 35%


Pinargozu Location SIVAS v Red areas show area prospective for Zn exploration in the province where Pasinex operates

Tufanbeyli Zinc District Yahyali Zinc District

v Infrastructure is strong in Turkey. The key to Pasinex being able to ramp up quickly to production was because of readily available infrastructure

Pinargozu/Akkaya License Horzum Mine

Bolkar Zinc District

ADANA Route to Port

v Access to major roads, port (Mersin), major airport (Adana), HV electrical

MERSIN PORT

35%


Pinargozu Mine – in the Taurus Mountains JV Area of Interest

Main city of Adana – 2.2 million Port of Mersin – 2½ hours away

Pinargozu

HV power available Water available

Horzum

35%

Known Zinc Occurrences


Turkish JV – True Partnership Akmetal A.S. - 50/50 JV at Pinargozu v Pasinex recognized it was important to have a local partner to build an operating mine. Traditionally joint venture businesses have a 50:50 ownership structure in Turkey. v Akmetal is a well established Turkish mining house with other mines in chrome, gold and base metals. v Akmetal is part of the Kurmel Group family business conglomerate with other businesses in cattle farming, carpet manufacturing, and real estate. v This JV is a true partnership, both partners bring strength to the Joint Venture. v A JV board makes decisions with regard to operations. Both partners have 3 seats. The Chairman is currently held by Steve Williams. v Akmetal brings strength in mine development and connections for getting needed things to operate efficiently in Turkey. v Pasinex brings strength in mining business strategy 35% and technical know how. Pasinex Resources Limited | CSE: PSE | FSE: PNX 10

Pasinex Financial Results - Q1 2018 Year-Over-Year Comparison (Canadian Dollars)

Q1 2018

Q1 2017

Pasinex Resources Lim ited Equity Gain

$2,984,186

$1,168,289

Im pairm ent Charge

$1,686,600

-

Net Incom e

$726,021

$863,030

Dividend Received from Horzum AS

$388,593

-

US $1.55/lb

US $1.26/lb

Zinc Price

35%


Horzum AS Financial Results - Q1 2018 Year-Over-Year Comparison (Canadian Dollars)

Q1 2018

Q1 2017

Horzum AS – Reporting as 100% Revenues

$9,497,707

$5,846,959

81%

50%

Net Incom e (before taxes)

$7,674,452

$2,921,650

Net Incom e (after taxes)

$5,968,372

$2,336,578

3.02 CAD/TRY 3.82 USD/TRY

2.77 CAD/TRY 3.67 USD/TRY

Gross Margin

Turkish Lira / CAD* Turkish Lira / USD**

Pasinex Resources Limited | CSE: PSE | FSE: PNX

35%

* Ju n e 2 1 , 2 0 1 8 C A D /T R Y clo s e d a t 3 .5 5 **Ju n e 2 1 , 2 0 1 8 U S D /T R Y c lo se d a t 4 .7 3 12

Horzum AS Operation Results - Q1 2018 Year-Over-Year Comparison

Q1 2018

Q1 2017

Horzum AS – Reporting as 100% Zinc Tonnes Produced

13,037

11,786

Zinc Grade

35%

32%

Cost Per Tonne Mined (CAD)*

$187

$180

US$ Cash Cost (Per Pound of Zinc Produced)*

$0.19

$0.21

35%

*N o n -G A A P m e a su re s. P le a s e re fe r to Q 1 M D A fo r re co n cilia tio n .


2018 Guidance Year-Over-Year Comparison Wet Tonnes

Grade

Pinargozu Operating Guidance for the Year Ended Decem ber 31, 2018 (100% Basis) Zinc oxide production

50,000 – 54,000

29% to 31%

Zinc sulphide production

3,000 – 4,000

37% to 39%

Lead Production

1,000 – 2,000

54% to 56%

54,000 – 60,000 Cost per tonne m ined

$205 - $230 CAD

Capital expenditures, including exploration and evaluation assets

$1,700,000 - $2,000,000 CAD

Underground developm ent and drilling

$4,500,000 - $5,000,000 CAD

35% Dividend to Pasinex

20,000,000 TRY


Pinargozu Development v Four adits from hillside now operating v Production of 60,000 tonnes of DSO concentrate p.a. v About 20,000 tonnes of contained Zn metal per year v About 40,000,000 lbs of contained Zn metal per year v Over 6.0 kilometres of underground development v 250 miners & engineers are working at Pinargozu v Mine safety standards priority focus v Continued drill success from surface and underground v NI 43-101 completed in November 2017 v 200,000 tonnes at 31% Zn (140,000,000 lbs) v 3 years operation – with more that can be found 35%


Pinargozu Mine - Mineralization

Plan view of mineralization predominantly zinc carbonates (oxides) and zinc sulphides shown in red area; underground workings shown in other colours

35%


Production from Multiple Faces v Cut and fill mining method v Mineralization in red; Underground drifting in other colours v Current production rate 170 tonnes per day of direct shipping product v Production is 85% oxide / 15% sulphide production of DSO grade material v DSO grade oxides – 30 – 34% Zn v DSO grade sulphides – 46 – 50% Zn 35%


Production Growth at Pinargozu Pinargozu Production Profile 57,625

60,000

2017

2018 Projected

6 0 ,0 0 0 5 0 ,0 0 0 4 0 ,0 0 0

31,148 3 0 ,0 0 0 2 0 ,0 0 0 1 0 ,0 0 0

10,224 6,731

0

2014

2015

2016

v Budget production is 60,000 tonnes DSO product / 40,000,000 lbs / 20,000 tonnes of contained Zn in 2018 v Target to increase resources to over 135% million tonnes to support over ten years mining


Pinargozu Financial 2017 / 2018

Production

Pasinex Net Income

v 57,625 tonnes of DSO material produced in 2017 v Zn oxide product grade assumed 33% Zn, Zn sulphide 48% Zn v By product production of Pb and Ag v Selling “spot” to realize on increased zinc price

v $5.8 M Net Income in 20171 v Operating income margin of 64% v Equity gain of $8.2 M

Exploration & Capital

Future Objectives

v Exploration budget in 2018 of +$3 M USD v $1 M USD on capital expenditures for mining equipment in 2018

v Target Inferred resource of 1 Mt @ 30% Zn v Increase zinc sales to 50 million pounds (22,000 tpa)

35%

1P in a rg o z u is a 5 0 /5 0 J V w ith A k m e ta l A .S . T h e re p o rte d p ro fit a n d sa le s re p re se n t P a sin e x ’ p o rtio n .


Exploration Conceptual Model

v Carbonate replacement type Zn - geological model v Current Pinargozu operation is high up in the “manto” – could be a deep system; lots of exploration opportunity v Skarn opportunity

Early in and high up in the manto system

35%


Regional Exploration in Turkey v The Pinargozu carbonate replacement zinc project is similar to CRD deposits in Mexico such as Naica and Juanicipio (Mag Silver) or La Platosa (Excellon) v $3.4 million USD in exploration in 2018 v Exploration is funded by production and positive cash flow v Pinargozu and region v Follow the manto deeper into the sulphides at Pinargozu v Geology suggests there are more Pinargozu’s v There is potential in the district to find more properties like Pinargozu v Akkaya property exploration in 2018 35%


Drilling Commences at Gunman Project v US$500,000 for initial drill program v Gunman project is thought to be a carbonate replacement style zinc deposit (similar to Pinargozu) – located south of Elko in Nevada v Preliminary, but limited drilling, had indicated zinc mineralization from 2 – 30% Zn in RC and diamond drilling

Nevada, White Pine County

v Earn in option agreement whereby Pasinex can earn to up to 80% interest in the project based on payments and exploration commitment v Drilling started in June 2018 35%


Pasinex Summary

A Primary Zinc Company

50% interest in Pinargozu mine, Turkey

40,000,000 lbs zinc production in 2017 and in 2018

Profitable operations (+60% net margin)

Resource expansion, drills turning

Large land position in a CRD zinc district in Turkey

New Zn opportunity with Gunman CRD zinc project in Nevada

Tightly held by few major shareholders

Highly leveraged to Zn price


Zinc 101 v Uses of zinc: v Galvanizing of Steel (making it rust proof) v Car bodies, street lamp posts, safety barriers, suspension bridges v Health: v Sunscreen and vitamins v Zinc Oxides v Paints, rubber, cosmetics, pharmaceuticals, plastics, inks, soaps, textile v Die-casting v Electrical equipment v China is a major consumer v Strong zinc price over the last year v Stocks of Zn continue to drop v Forecasts: tightening supply following closures, price risk is still to the upside. 2018 could see some further price improvement v What’s going to happen to zinc in the next 5 years? v Battery opportunity 35%


LME Zinc Supply vs. Zinc Price - Supply/Demand Looks Positive for 3 to 5 Years

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Contact Details Canada Main Office Pasinex Resources Limited 82 Richmond St. E. Toronto, ON M5C 1P1 Tel +1 416 861 9659

Adana Office, Turkey Zeytinli Mah. Turhan Cemal Beriker Blv. No 607 / A Seyhan, Adana

Office of President, Canada Tel +1 416 861 9659 [email protected]

General Information [email protected]

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PASSION IN EXPLORATION

“The way to build a zinc company is one mine at a time” - Steve Williams