The information given in this presentation and during Mandalay Resources Corporation’s September 12, 2016 Investor Day contain "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 30, 2016 and in its final prospectus dated

July 18, 2016, 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.

Qualified Persons

The exploration programs at Costerfield and Björkdal are supervised by Chris Gregory (Member, Australian Institute of Geoscientists, VP of

Operational Geology for Mandalay and a “Qualified Person” as defined under National Instrument 43-101, Mr. Gregory regularly visits Costerfield

and Björkdal and has reviewed and approved the scientific and technical information related to these projects contained in this presentation.

The exploration programs at the Cerro Bayo and Challacollo projects are supervised by Scott Manske, Chief Cordilleran Geologist of Mandalay

Resources, and an Oregon registered Professional Geologist. A “Qualified Person” as defined by NI 43-101, he has reviewed and approved the

technical and scientific information related to these projects contained in the presentation.

Non-IFRS MeasuresThe presentations given during Mandalay Resources Corporation’s September 12, 2016 Investor Day Presentations include non-IFRS

performance measures including Adjusted EBITDA, cash costs and site all-in costs. These measures are included in these presentations

because the Company believes these are useful indicators to discuss and understand performance of the Company and its operations. These

performance measures do not have a meaning within IFRS and, therefore, amounts presented may not be comparable to similar data presented

by other mining companies. These non-IFRS performance measures should not be considered in isolation as a substitute for measures of

performance in accordance with IFRS. For a more detailed discussion of how the Company calculates non-IFRS performance measures and

reconciliations (where applicable) to the nearest IFRS measure please refer to the Company’s management discussion and analysis for the

quarter ended June 30, 2016. All currency references in US$ unless otherwise indicated

Forward-looking Statements

2

Mining: Reasons for undervalued mines

Poorly selected, inefficient mining method; opportunities for mechanization

Poor grade controls resulting in over-dilution or low mining recoveries

Poor preventive maintenance leading to poor availability

Higher operating costs than comparable operations

Poor knowledge of operating parameters

3

Propose mining improvements

We complete due diligence on our mining improvement hypotheses

What we look for in an acquisition

The more of these we see, the greater potential upside

If none or few of these exist, likely to be little upside in the way of mining

improvements – we will walk

4

Mandalay approach

Review existing information – geology, rock conditions, grades, etc.

Perform studies to obtain needed information – geotechnical studies, etc.

Investigate major mining method changes

1. Simplify – Focus on what works

2. Investigate

3. Implement feasible major mining method changes immediately

4. Ongoing continuous improvement

5. Upgrade prev. maintenance to enhance availability & reduce costs

Carry out incremental changes to – Improve production, lower costs,

reduce dilution and improve mining recoveries

5

Costerfield: mining improvement

Very inefficient and expensive mining method split between cut and fill and

half upper jackleg stope (HUJS) extraction

Very poor mining recoveries and significant dilution

Very poor safety record due to miner exposure to hazardous areas

MND assumed control December 2009

Interventions

Studies showed that cemented rock fill (CRF) method would be most cost

effective and enabling very good recoveries

Begun gradual implementation of mining change to CRF to obtain safer,

lower cost, higher recovery, higher production mining method

Results

Significant safety improvement, LTIFR dropped from 20 to current 0

Workforce reduction with more mechanized method

Mining costs reduced by two thirds

Significant recovery improvement and dilution reduction

Underground mining method relative costs

6

Would allow for significant lower

costs and production increase

Significantly safer mining

method to employ

7

Costerfield: previous cut and fill mining method

8

Costerfield: New cemented rock fill mining method

Impact of mining method change in W-lode

9

Old cut & fill method

New CRF method

Improved

mining

recovery

10

Costerfield: Increased production and declining costs

$0

$100

$200

$300

$400

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

Q4-09(Dec. only)

Q4-10 Q4-11 Q4-12 Q4-13 Q4-14 Q4-15

USD

/ To

nn

e

Ton

ne

s P

er

Qu

arte

r

Mining Rate and Unit Cost

t Mined Cost/ t Mined

11

Cerro Bayo: mining improvements

Well preserved but early 1990’s vintage plant

On care and maintenance

Prior owner was utilizing manual shrinkage mining method

MND assumed control August 2010

Interventions

Restarted mining immediately in September. 2010

Immediate conversion to mechanized longhole open stoping method, no

shrinkage stopes mined by Mandalay

Gradual mining ramp-up to peak of 1,400 tpd over 3-year period

Results

Safety improvement, changing from manual to mechanized method

Significant workforce reduction compared to prior owner

Mining cost reduction of over 50%

Underground mining method relative costs

12

Would allow for both production increase

and lowering of unit costs

Open stoping significantly

safer mining method

13

Cerro Bayo: Previous shrinkage stoping methodN Upper limit of reserve

Level 350

Being developed

Hardheld Drilling

Level in production

Blasted material is mucked to remove

swell and maintain work platform

Access from the Ramp

Mucking Accesses

Hardheld Drilling

Level 300

Reserves to mine Accesses Development Hr-Vr Longholes Direction of advance Mined out Blasted material

Acc

ess

Rai

se

Re

serv

e b

ou

nd

ary R

ese

rve b

ou

nd

ary

LEYENDA

STOPE IN PRODUCTION STOPE IN DEVELOPED

Acc

ess

Rai

se

Acc

ess

Rai

se

14

Cerro Bayo: New long hole open stoping methodN

Level 285 - mined out

drilled longholes

Level 270 - mined out

Level 255 - in production

Level 240 - in production

Level 225 - being developed

Level 205 - being developed

Accesses from the ramp centrally located and

aligned vertically, where possible

Level 190 - planned

Reserves to mine Level access Longtitudinal development Longholes Direction of advance Mined out pillars

Re

serv

e b

ou

nd

ary

Re

serve

bo

un

dary

Access to the level from the main ramp

Legend

Upper limit of reserve

Longhole production inn retreat toward the level access

Longtitudinal vein development, to the lateral limits of the reserve

15

Cerro Bayo: Increased production and declining costs

$0

$10

$20

$30

$40

$50

$60

$70

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14 Q2-15 Q4-15 Q2-16

$/

Ton

ne

Ton

ne

s P

er

Qu

arte

rMining Rate and Unit Cost

t Mined Cost/ t Mined

16

Björkdal: Mining improvements

Was efficient low-cost mining method in open pit and underground

Very poor understanding of grade distribution in underground

No grade control used in underground mine

Very large mining dimensions for narrow veins

MND assumed control September, 2014

Interventions, actual and future

Implemented Blast Movement Monitoring in open pit for better grade control

Introduced best practice mapping, sampling and rapid assaying of all ore

development headings –more selective mining and rejection of waste

Better Resources and Reserves model for accurate long-term planning

Lowered stope heights for better mining control

Decreasing development and stope sizes for dilution control

Medium-term fleet change out for further dilution controls