First Quantum Minerals Ltd. · TSX:FM
First Quantum Minerals — BMO Global Metals & Mining Conference 2014
33 slides from First Quantum Minerals's conference presentation, February 2014
Slide 1: First Quantum Minerals Ltd.
& FIRST QUANTUM MINERALS LTD. TSX: FM; LSE: FQM “2 * a Diversified : eres ‘ 23” GLOBAL MES a MINING C ON F R N Cie = = - - February 23 - 26, 2014 BMO & Capital Markets Your ambition achieved.
Slide 2: Cautionary Note Regarding Forward-Looking Statement
Cautionary Note Regarding Forward-Looking Statement Some of the statements contained in the following material are forward-looking statements and not statement of facts. Such statements are based on the current beliefs of management, as well as assumptions based on management information currently a
Slide 3: First Quantum Minerals – At a Glance
First Quantum Minerals – At a Glance • A Global Company • Industry-Leading Growth – Operations and projects in 8 countries – 5 major projects under development – Production capacities to rise to 1.1 • High-Quality, Stable, Efficient Operations Mtpa for copper and 110 ktpa for nickel – 7 operations b
Slide 4: 2013 – A Transformative Year
2013 – A Transformative Year Successfully acquired Inmet Mining Corporation – Control of the Tier 1 Cobre Panama copper project – Added 3 well-run, low-cost operations Restructured financing and capital structure Advanced projects under development Record production at Flagship Kansanshi min
Slide 5: Cobre Panama – A Tier 1 Copper Project
Cobre Panama – A Tier 1 Copper Project • Acquired March 2013 • Critical review following acquisition – Focused mainly on Engineering, Contracts and Construction initially – Copied major areas of the design of the almost-complete Sentinel process plant • Made significant changes – Unwound ~US$1.7B of
Slide 6: Cobre Panama – A Tier 1 Copper Project
Cobre Panama – A Tier 1 Copper Project • A larger, more robust project – Installed capacity Yrs 1-10 = ~70 Mtpa 17% higher than prior Expansion up to 100 Mtpa beyond Yr 10 – Average annual LOM* copper production of 320,000 tonnes ~ 20% higher than prior – Average annual LOM by-product producti
Slide 7: Cobre Panama – A Tier 1 Copper Project
Cobre Panama – A Tier 1 Copper Project • Capex estimate of $6.4 billion – inclusive of $913 million incurred prior to acquisition • Capital per installed tonne of capacity of $17,125 – ~25% lower than prior • A realistic and well-defined timeframe – 230 KV overland power line – Q4 ’15 – 300 MW power
Slide 8: Cobre Panama Project – Process Plant Site Earthworks
COBRE PANAMA PROJECT – PROCESS PLANT SITE EARTHWORKS 8
Slide 9: Cobre Panama Project – Mill Pad Earthworks
COBRE PANAMA PROJECT – MILL PAD EARTHWORKS 9
Slide 10: Cobre Panama Project – Process Plant Stockpile Pad
COBRE PANAMA PROJECT – PROCESS PLANT STOCKPILE PAD 10
Slide 11: Cobre Panama Project – Power Station Area
COBRE PANAMA PROJECT – POWER STATION AREA 11
Slide 12: Cobre Panama Project – Breakwater and Material Offloading Facility
COBRE PANAMA PROJECT – BREAKWATER AND MATERIAL OFFLOADING FACILITY 12
Slide 13: Optimizing Capital Structure & Financial Flexibility
Optimizing Capital Structure & Financial Flexibility Refinancing the short-term US$2.5B revolver at FQM (Akubra) with a five-year Term and Revolving Credit Facility Changing the FQM (Akubra) Inc. US$1.49B 8.75% 2020 and US$500M 7.50% 2021 notes into new 6.75% 6-year notes and new 7.00% 7-year no
Slide 14: Current Corporate Structure Chart
Current Corporate Structure Chart (Figures as of 30 September 2013) US$350 MM Senior Notes LTM Sep-13 EBITDA: US$1.1 Bn Total Debt / Total Leverage: US$0.8 Bn / 0.7x Total Assets: US$8.2 Bn US$2.0 Bn Senior Notes 100% 100% 100% 100% 100% 100% 100% US$2.5 Bn RCF FQM FQM Australia Metal Corp FQM
Slide 15: Pro Forma Corporate Structure Chart
Pro Forma Corporate Structure Chart (Figures as of 30 September 2013) US$2.28 Bn (1) New Senior Notes US$350m Senior Notes US$2.5 Bn 5 year Term and RCF LTM Sept-13 EBITDA: US$1.6 Bn Total Debt / Total Leverage: US$3.5 Bn / 2.1x Total Assets: $15.0 Bn 100% 100% 100% 100% 100% 100% 100% 100% 10
Slide 16: Advanced Projects: Copper Smelter, Zambia
Advanced Projects Copper Smelter, Zambia • Processing capacity of 1.2 Mtpa —Combination of concentrate from Kansanshi & Sentinel —Average copper grade 26% • Copper production 300,000 Tpa; acid production 1.0 Mtpa • Estimates: − Capital cost of US$690M − Commissioning from mid-2014 • Estimated saving
Slide 17: Advanced Projects: Sentinel Cu project, Zambia
Advanced Projects Sentinel Cu project, Zambia • Located ~ 140 km northwest of Solwezi, northern Zambia • M&I resource of 1,027 Mt at 0.51% Cu grade, containing 5.2 Mt Cu • Estimates: – 2.2:1 LOM strip ratio – >15 years mine life – Annual production up to 300,000 tonnes – US$2.0B capex (incl. Enterpr
Slide 18: Advanced Projects: Sentinel Cu project, Zambia
Advanced Projects Sentinel Cu project, Zambia • 55 Mtpa target throughput • 3 semi-mobile in pit crushers and assembly of large scale mining equipment • Largest operating SAG/Ball mill trains in the world (100MW milling power) • 265,000t of freight = 14,500 truckloads of materials • 2 rivers to be d
Slide 19: Advanced Projects – Sentinel 100MW Milling
Advanced Projects – Sentinel 100MW Milling – 2 x 40’SAG Mills + 2 x 28’Ball Mills 19
Slide 20: Advanced Projects – Sentinel Senior Housing
Advanced Projects – Sentinel Senior Housing SPORTS FACILITY 04-NOV-2013 SENIOR HOUSING - SINGLES 31-MAR-2013 SENIOR HOUSING AREA 28-FEB-2013 TRIDENT PREPARATORY SCHOOL 05-NOV-2013 20
Slide 21: Advanced Projects – Sentinel Affordable Housing
Advanced Projects – Sentinel Affordable Housing AFFORDABLE HOUSING LAYOUT TEACHER’S HOME 3-JAN-2014 TRUST SCHOOL 05-NOV-2013 COMPLETED 4-BEDROOM HOUSE 3-JAN-2014 21
Slide 22: Kansanshi Cu-Au mine, Zambia
High-Quality, Stable Operations Kansanshi Cu-Au mine, Zambia • Located near Solwezi in the north western Province of Zambia • First production in 2005 • Open pit mining • Flexible ore treatment to allow for variation in ore type : – sulphide circuit; oxide circuit; gold facility • As at December 31,
Slide 23: Kansanshi Cu-Au mine, Zambia
High-Quality, Stable Operations Kansanshi Cu-Au mine, Zambia • 2013 record production reflects capacity expansion – 270,724 tonnes of copper Expansion Estimate Production Project Capacity Completion Cost Impact – 167,395 ounces of gold (US$M) – C1 cash cost of $1.38/lb copper Oxide 7.2 Mtpa Complete
Slide 24: Guelb Moghrein Cu-Au mine, Mauritania
High-Quality, Stable Operations Guelb Moghrein Cu-Au mine, Mauritania • 100% ownership • Located 250 kilometres northeast of the nation’s capital, Nouakchott • As at December 31, 2012, the estimated mine life was ~ 9 years (including stockpiles) based on current operations • First production in 2006
Slide 25: Guelb Moghrein Cu-Au mine, Mauritania
High-Quality, Stable Operations Guelb Moghrein Cu-Au mine, Mauritania • Record production in 2013 – 37,970 tonnes of copper – 58,191 ounces of gold – C1 cash cost of $1.58/lb copper • Focused on improving plant availability • IOCG type deposit - structure and mineralogy has common features with othe
Slide 26: Ravensthorpe Ni mine, Australia
High-Quality, Stable Operations Ravensthorpe Ni mine, Australia • Acquired as a decommissioned plant in 2010 • First production within 20 months of purchase • Estimated mine life of 32 years • Commercial production declared Dec 2011 • Workforce = ~428 • Record performance in 2013 – 38,103 tonnes of
Slide 27: Kevitsa Ni-Cu-PGE mine, Finland
High-Quality, Stable Operations Kevitsa Ni-Cu-PGE mine, Finland • Built, commissioned and started commercial operations within 36 months of board approval • Estimated mine life of 29 years • Commercial production declared August 2012 • Workforce = ~337 • Further potential – Process optimization – Ap
Slide 28: Las Cruces Cu mine, Spain
High-Quality, Stable Operations Las Cruces Cu mine, Spain • Acquired in March 2013 • Estimated mine life of 9 years; potential for extension • Current average reserve grade of 5.4% copper • Workforce = ~240 direct employees; 574 contractors • Annual production capacity – 72,000 tonnes of copper cath
Slide 29: Çayeli Cu-Zn mine, Turkey
High-Quality, Stable Operations Çayeli Cu-Zn mine, Turkey • Acquired in March 2013 • Estimated mine life of 6 years with potential for an additional 3 years • Average grade of 3.1% copper and 3.6% zinc • Workforce = ~472 employees • 2013 performance: – 31,510 tonnes of copper – 43,097 tonnes of zinc
Slide 30: Pyhäsalmi Cu-Zn mine, Finland
High-Quality, Stable Operations Pyhäsalmi Cu-Zn mine, Finland • Acquired in March 2013 • One of the most efficient underground mines in the world • Estimated mine life of 6 years • Average grade of 1.1% copper and 1.9% zinc • Workforce = ~203 employees • 2013 Performance: – 14,854 tonnes of copper –
Slide 31: Strong 2013 Results
Strong 2013 Results • Production up • Copper up 34% to 412,281 tonnes • Nickel up 28% to 47,066 tonnes • Gold up 23% to 248,078 ounces • Cash cost lowered • Copper lowered by 13% to $1.30/lb • Nickel lowered by 15% to $5.02/lb • Comparative net earnings of $539.4M or $0.96 per share, inclusive of: •
Slide 32: Full Year 2014 Guidance
Full Year 2014 Guidance • Production - Copper between 418,000 and 444,000 tonnes - Nickel between 42,000 and 47,000 tonnes - Gold between 221,000 and 246,000 ounces - Zinc between 59,000 and 65,000 tonnes - Palladium and platinum between 22,000 and 24,000 ounces each • C1 cash cost - Copper between
Slide 33: February 2014
& FIRST QUANTUM MINERALS LTD. February 2014
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