Fortune Bay

Overview

Fortune Bay Corp. (TSXV:FOR, FWB:5QN, OTCQX:FTBYF) is a mineral exploration and development company focused on creating value by advancing its fully owned gold asset in Saskatchewan – Canada’s top-ranked mining jurisdiction. The company also has two uranium assets in the prolific Athabasca Basin, and a gold-copper asset in Chiapas, Mexico, providing additional value to shareholders.

The company’s current exploration work is centered on its Goldfields Project, an advanced gold asset approximately 13 kilometers from Uranium City in Saskatchewan. Fortune Bay’s two uranium projects - Strike and Murmac - are also located in proximity to Uranium City. The Goldfields Project is home to the historical Box mine which previously produced 64,000 ounces of gold. It has significant open-pit constrained mineral resource, including indicated mineral resource of 980,000 ounces of gold (23.2 million tonnes at an average grade of 1.31 grams per ton), and inferred mineral resource of 211,000 ounces of gold (7.1 Mt at an average grade of 0.92 g/t). The project has existing infrastructure, including a powerline to the site, and a valid permit for a mine and mill development – key differentiators from other Canadian gold projects.

The most recent preliminary economic assessment( PEA), dated October 31, 2022, shows that Goldfields has potential to become a highly profitable open-pit gold mine. The study produced robust economics with an after-tax net present value (discount rate 5 percent) of C$285 million, internal rate of return of 35.2 percent and a payback of 1.7 years, estimated with gold price of US$1,650 per ounce. The PEA was produced by Ausenco Engineering Canada Inc., one of the most experienced and reputable engineering firms working on gold projects in Canada.

Fortune Bay’s Strike and Murmac uranium projects are both 100-percent-owned and provide the company with a dominant land position of high-grade, unconformity-related targets in the Uranium City area (Canada’s original uranium mining district) in northern Saskatchewan. The projects are located on the margin of the Athabasca Basin, in a geological setting similar to the recent discoveries of Arrow (Nexgen Energy) and Triple R (Fission Uranium). Both projects host numerous historical high-grade uranium occurrences and have the right geological ingredients for the high-grade unconformity-related deposits that make the Athabasca Basin world-famous. Uranium City is a historical mining hub and the area is endowed with infrastructure including an airport, maintained roads and a powerline from a hydro-station that runs in proximity to both projects.

Uranium mineralization was discovered in multiple drill holes during the first phase of exploration drilling in 2022. These results have validated the exploration model, confirmed the highly prospective nature of the target areas, and provide focus for subsequent drilling campaigns.

Fortune Bay offers investors a highly attractive opportunity to engage not only with an advanced gold asset with drill-defined mineral resources, but also an entry point into the prolific Athabasca Basin. This diversified asset base provides the company with resilience against changing market conditions, commodity prices and other factors.

Fortune Bay is poised for growth as it advances its three Saskatchewan projects, with the potential to deliver value catalysts from project advancement, resource expansion and grassroots discovery.

Fortune Bay’s management team has more than 20 years of combined Athabasca exploration experience including with Denison Mines (TSX:DML), Fission Uranium (TSX:FCU) and Cameco( TSX:CCO), and a proven track record of discovery, resource expansion and shareholder value creation. The company’s team led the C$351-million sale of Brigus Gold Corp. and was responsible for the discovery of more than 40 million ounces of gold in Colombia with AngloGold Ashanti (JSE:ANG).

Company Highlights

• A diversified asset base in northern Saskatchewan includes an advanced gold project and two early-stage uranium projects.
• Recently completed NI 43-101 preliminary economic assessment for Goldfields supports an open-pit gold mining operation with low capital cost and a high rate of return over an 8.3-year mine life, with an average annual production of 101,000 ounces of gold.
• Initial exploration drilling on uranium projects has discovered uranium in multiple drill holes. The uranium occurs within the right settings for high-grade deposits related to the Athabasca Basin.
• A pipeline gold-copper asset in Mexico that includes a gold deposit and numerous exploration targets.
• Fortune Bay is led by a strong management and technical team with decades of experience and a proven track record of discovery, resource expansion, project development and shareholder value creation.

Key Projects

Goldfields

The 100-percent-owned Goldfields project is located approximately 13 kilometers south of Uranium City in northern Saskatchewan. The project, covering approximately 5,000 hectares, is host to the Box and Athona gold deposits and numerous other gold prospects and occurrences.

Located within a historical mining area, the project benefits from established infrastructure, including a road and hydro-powerline to the Box deposit. Nearby facilities and services in Uranium City include bulk fuel, civil contractors, and a commercial airport. The project has a history of gold production (64,000 oz produced between 1939 to 1942), numerous exploration drilling campaigns (over 1,000 drill holes) and historical mining studies by previous owners of the project.

The current total gold resource for Box and Athona stands at 979,900 ounces of gold in the indicated category (23.2 Mt at an average grade of 1.31 g/t gold) and 210,800 ounces of gold in the inferred category (7.1 Mt at an average grade of 0.92 g/t gold).

A PEA was recently completed for the project by Ausenco Engineering Canada Inc., effective date October 31, 2022. The PEA provides a base case assessment for developing the Goldfields mineral resource by conventional open-pit mining methods, and gold recovery with a standard free milling flowsheet, incorporating gravity and leaching of the gravity tails. The economic model supports an operation with low capital cost and high rate of return over an 8.3-year mine life, with average annual production of 101,000 ounces of gold.

Highlights from the PEA included:

• Robust economics with after-tax net present value (discount rate 5 percent) of C$285 million, internal rate of return of 35.2 percent and payback of 1.7 years estimated with gold price of US$1,650 per ounce
• Average annual gold production of 101,000 ounces over life of mine (LOM), with an average of 122,000 ounces per year in the first four years
• 8.3-year life-of-mine, producing 835,000 ounces of gold
• Average cash cost of US$778/oz and all-in sustaining cost of US$889/oz gold
• Initial capital expenditure of C$234 million
• Mill capacity of 7,500 metric tons per day (2.7 Mt per annum) with average gold recovery of 95.3 percent

The project has numerous desirable attributes including a low strip ratio, simple mineralogy and free-milling gold. The economics are highlighted by low initial capital costs, competitive all-in sustaining costs, a relatively short payback period and a favorable NPV:CAPEX ratio. In addition, the established infrastructure in a historical mining area, including a powerline to site, and a valid development permit are expected to facilitate the timeline towards construction and operations. The project continues to present numerous opportunities, including exploration potential, and additional mining and processing opportunities to be further investigated during a pre-feasibility stage.

Strike Uranium

The 100-percent-owned Strike Uranium Project has been confirmed to have potential for high-grade unconformity-related, basement-hosted uranium deposits in a setting similar to other discoveries on the margin of the Athabasca Basin.

Historical exploration by Cameo confirmed the presence of extensive EM conductors and significant uranium oxide (U3O8) endowment at Strike, and provided high-quality VTEMTM and geochemical datasets. Drill targets were identified, but exploration was halted during the uranium price collapse of 2007/2008, and the ground was allowed to expire in 2012 post-Fukushima.

Fortune Bay augmented the historical datasets with ground gravity survey and completed a maiden drill program of nine holes (2,064 meters) in the summer of 2022. Anomalous uranium was intersected in three of the holes, up to a maximum individual assay of 0.43 percent U3O8. Shallow, elevated uranium in drill core is associated with “pathfinder” elements (typical of high-grade Athabasca deposits) and is hosted in prospective graphitic units with favorable brittle structure and alteration.

The drill results confirm that an Athabasca Basin unconformity-style mineralizing system has been active at Strike. Follow-up of newly intersected mineralization is warranted, as well as drill testing of numerous geophysical and structural targets.

Murmac Uranium

The 100-percent-owned Murmac Uranium Project has the potential for high-grade unconformity-related, basement-hosted uranium deposits in a setting similar to other discoveries on the margin of the Athabasca Basin.

In 2022, Fortune Bay augmented the historical exploration datasets (captured from assessment reports) with high-quality VTEMTM and ground gravity survey, and completed a maiden drill program of 15 holes (3,168 meters). Anomalous uranium, more than 100 parts per million (ppm), was intersected in six of the holes, up to a maximum individual assay of 0.18 percent U3O8. Shallow, elevated uranium in drill core is associated with “pathfinder” elements (typical of high-grade Athabasca deposits) and is hosted in prospective highly-graphitic units with favorable brittle structures and alteration.

The drill results confirm that an Athabasca Basin unconformity-style mineralizing system has been active at Murmac. Follow-up of newly intersected mineralization is warranted, as well as drill testing of numerous geophysical and structural targets.

Ixhuatán Copper-Gold Project

Located in Chiapas State, Mexico, the 100-percent-owned Ixhuatán Project is a copper-gold asset that includes a historical gold resource and significant exploration and development upside. It covers the 4,176-hectare Rio Negro concession, valid until May 10, 2051. The project is located immediately southwest of the Santa Fe mine and is accessible by roads running 5 kilometers east of the town of Rayon, Chiapas. The area hosts the Campamento gold-silver, the Cerro La Mina copper-gold prospect, and numerous other exploration targets.

Approximately 89,000 meters of drilling in 342 holes have been undertaken by Linear Gold and Kinross Gold at Ixhuatán since May 2004, which identified near-surface gold mineralization through soil sampling. All the significant mineralization drilled on the property to date demonstrates an early porphyry-related potassic alteration overprinted by a later stage epithermal gold mineralizing event. This is consistent with the upper portion of a large copper-gold-silver-molybdenum district-scale mineralizing system.

The Ixhuatán project includes unexplored copper potential, and numerous underexplored gold zones that warrant further exploration.

Management Team

Dale Verran - Chief Executive Officer

Dale Verran has over 20 years of international experience in the mining and mineral exploration industry. He is a recognized business and technical leader with a proven track record of project generation, discovery and project advancement in Africa and Canada. Most recently, Verran served as vice president of exploration for Denison Mines Corp. which is a Lundin Group Company. He has previously served as executive technical director for Remote Exploration Services (Pty) Ltd. (Mineral Services Group) which is a large independent exploration group operating in Africa. He also served as exploration manager for Manica Minerals Limited. Manica Minerals Limited is a private prospect generator company with an extensive multi-commodity portfolio of projects in Africa.

Verran holds a bachelor of science in geology from the University of KwaZulu-Natal, an honors bachelor of science in geology from the University of Cape Town and a master of science in exploration geology from Rhodes University. Verran is a registered professional geoscientist and professional natural scientist.

Sarah Oliver - CFO

Sarah Oliver has over 10 years of experience working in the accounting and finance industries. Most recently, Ms. Oliver served as the chief financial officer of the predecessor company to Fortune Bay Corp. beginning in November 2014. She worked with PwC Canada in the consulting and deals group and then in the company’s assurance practice as a senior manager. As a senior manager of the assurance practice at PwC, she assisted her clients through various acquisitions and mergers and public and private financings. She also advised clients on accounting policy and control implementation as a senior manager. Oliver has been a chartered professional accountant and chartered accountant since 2007.

Gareth Garlick - Technical Director

Gareth Garlick has over 20 years of international experience in the mining and mineral exploration industry. He has work experience in all aspects of the mining cycle ranging from grassroots exploration to resource estimation and resource reconciliation in producing mines. Most recently, Garlick served as senior geologist and consulting projects manager at Mineral Services Canada Inc., a consulting company based in Vancouver, B.C., Canada. Garlick holds a bachelor of science in geology (honors) from the University of Cape Town and is a registered professional natural scientist.

Eric Bort - Exploration Manager

Eric Bort has nine years of mineral exploration experience in northern Saskatchewan with Cameco Corp. Key areas of expertise include design, implementation and management of drilling programs. Experience ranging from grassroots exploration to advanced projects including discovery and delineation. Significant experience in data management and 3D geological modeling. Bort holds a bachelor of science in geology from the University of Saskatchewan and is a registered professional geoscientist.

Wade K. Dawe - Executive Chairman

Wade Dawe is an accomplished entrepreneur, financier and investor based in Halifax, Nova Scotia, Canada. He has founded or co-founded several successful companies, including Keeper Resources Inc. in 2003 and Brigus Gold Corp. in 2010. Keeper Resources Inc. was sold for $51.6 million in 2008. Brigus Gold Corp. was acquired by Primero Mining Corp. in 2014 in an all-share deal valued at $351 million. He currently serves as a director of TSX-listed Pivot Technology Solutions Inc. and TSX-listed kneat.com inc.

He holds a bachelor of commerce degree from Memorial University (MUN), where he serves on the advisory board to the faculty of business administration. His philanthropic activities include establishing and personally funding the annual James R. Pearcey Entrepreneurial Scholarship at MUN. He recently funded DC Makes which is a new entrepreneurship-based program at the Discovery Centre in Halifax, Nova Scotia.

Dawe is originally from Newfoundland. He is also a member of the Young Presidents’ Organization, an international organization for business leaders.

Derrick Gill - Independent Director

Derrick Gill is a co-founder and a director of Strategic Concepts and SCI Software which provides strategic planning, financial modeling and business development consultation to major mining and oil and gas projects in Canada. Gill's 30-year career has included executive roles at Voisey's Bay Nickel, Diamond Fields Resources and Bristol Communications. Gill received his undergraduate degree in business administration from Memorial University.

Michael Gross - Independent Director

Michael Gross has extensive capital markets experience, having served as either an executive or as a director with several venture-stage companies. Dr. Gross was a founder and chairman of the board of NWest Energy Corp. before its successful initial public offering in 2008. Dr. Gross is currently on the board of Sona Nanotech Inc. which is developing a lateral flow test for Covid-19. Dr. Gross has been a professor of orthopedic surgery for over 20 years. He consults extensively in design and implantation techniques with the orthopedic manufacturing industry. Gross is also the founder of companies specializing in proprietary medical devices. He received his degree in medicine from the University of Newcastle Upon Tyne in England. He obtained a fellowship in surgery in London and a Canadian Fellowship in Orthopaedic Surgery in 1981. Dr. Gross has completed the Rotman Directorship program and is a member of the Institute of Directors.

Melinda Lee - Independent Director

Melinda Lee is a corporate director and chartered professional accountant with over 20 years of professional experience in accounting and investments. Lee’s experience includes eight years of experience at the board of directors level. As a member of the senior executive team of private and public investment companies, she is knowledgeable in securities laws and has a broad range of experience in investing, corporate finance and transactions. Her experience also includes mergers, acquisitions and take-over bids. Through her experience as a director of several publicly-traded companies in diverse industries, Lee has dealt with the high-level issues facing public entities, particularly with respect to financial issues through active participation in the audit committees. Lee received her undergraduate degree in business administration from St. Francis Xavier University and her ICD.D designation from the Institute of Corporate Directors and the Rotman School of Management.

Robert Shaw - Independent Director

Robert Shaw has over 30 years of mineral exploration experience throughout the Americas. At Golden Star Resources/Cambior Inc., he worked with the generative and development teams at Omai in Guyana and Gros Rosebel in Suriname. He was a founding member and exploration manager with Metallica Resources Inc. (Cerro San Pedro, Mexico; Gramalote, Colombia; Mara Rosa, Brasil; El Morro-La Fortuna, Chile). In Perú, he was a co-founder of Compañia Minera Phosphex where he was responsible for the re-discovery of the giant Mantaro phosphate deposits (Sprott Resource Corp.-Stonegate Agricom). At AngloGold Ashanti, he served as chief geologist of Colombia and consultant for the Americas. He was a formative member of the generative team which identified and advanced numerous projects including Gramalote, La Colosa and La Quebradona, which presently contain drill-indicated resources exceeding 40 million ounces of gold. Shaw received a master of science in economic geology in 1990 from the University of Alberta. Most recently, he served as editor and lead author for a major Springer Nature volume in 2019 that describes the geology, tectonics and metallogeny of the northern Andean region.