Energy Prospectus

Solaris hosted a luncheon for us in Houston today. I was very impressed by Daniel Earle's presentation.

The stock closed at $6.54Cdn today, which compares to First Call's price target of $19.58Cdn.

Based on the Company's most recent 3rd party "Resource Report", their PV10 Net Asset Value of just their proved reserves is over $17.00Cdn per share.

KEY POINT TODAY: Solaris is controlled by The Augusta Group, which has a proven track record of building up the value of an exploration company and then selling it to the highest bidder. They are going to sell this company "when the time is right".
> The Warintza Project in Ecuador is a "World Class" copper discovery (at least 1.5 billion tons of high grade copper ore) that has been proven by an extensive drilling program. Additional drilling programs at planned that increase the proven reserves.
> Solaris will be spinning out their other assets to "Solaris Exploration" before putting SLS up for sale.
> SLS shareholders will get 100% of the Solaris Exploration stock, which will be public.
> My take is that SLS will be sold in 2024 when copper prices should be much higher because copper demand is likely to exceed supply within two years. Why? because several the top ten largest copper mines in the world are "rolling over" / running out of reserves and copper demand increases year-after-year.

You can view the slides that Daniel Earle spoke from here: https://www.solarisresources.com/

It appears that Solaris trades in the U.S. (OTCQB) using the symbol SLSSF. Average daily volume is quite low (90 day avg 4,820), so it is not very liquid. I have no idea what its TSX avg daily volume is.

By using the TSX ticker SLS.TO in your post, are you recommending that those interested trade it on that exchange and avoid trading it on the OTCQB?

Also, in a sale of a company like this one, what would be the expected deal price range relative to PV-10 NAV? I.e., should it sell for 50-75% of PV-10 NAV? higher?

Thanks

Average daily trading volume on the TSX is 175,000 shares.

Where you trade it is up to you. Getting access to the TSX is easy.

After his presentation Daniel said that Augusta Group would expect to sell the company for ~PV10 Net Asset Value of the proved reserves, which today is $17/share. Note that they are going to spin out all of their other exploration projects to a new public company.

Based on what I heard yesterday, the timeline is to sell it in 18-24 months. During that time, proved reserves will be increased by more drilling.

Warintza is a VERY LARGE project and Solaris has no intention of developing the mine themselves because the development costs would be over $1 Billion. There are at least ten very large mining companies that should be interested in buying it.

If you have more questions send them to Scott Koyich at Brisco Capital. Scott is their IR manager. He has been an EPG member for over ten years.
scott@briscocapital.com

Scott can send you several analysts' reports on the company.

This is why I like SLS:
"The recent downturn for copper prices only stands to worsen as the Covid pandemic followe by fear of recession discourages new investments for the metal used in EVs and power grids."

Bloomberg: "You wouldn't know it from looking at the market today, but some of the largest miners and metals traders are warning that in just a couple of years' time, a massive shortfall will emerge for the world's most critical metal — one that could itself hold back global growth, stoke inflation by raising manufacturing costs and throw global climate goals off course. The recent downturn and the under-investment that ensues only threatens to make it worse."

Read more: https://finance.yahoo.com/news/great-co ... 27036.html