Slide 1: Corporate Presentation May 2012
TSX: LUN OMX: LUMI Corporate Presentation May 2012
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward Looking Statements This presentation contains forward-looking statements. These forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events. These forward- looking statements are
Slide 3: Key Asset Overview
Key Asset Overview • European Operations • Tenke Fungurume • Growth Projects • Neves-Corvo, Portugal • Tier 1 Cu/Co asset • Lombador Phases I & II (Cu/Zn) • 24% interest • Semblana • Zinkgruvan, Sweden • Freeport-McMoRan • Touro Project (Zn/Pb/Cu) operator • Exploration • Aguablanca, Spain • Phase I
Slide 4: Copper Dominant with Zinc Leverage
Copper Dominant with Zinc Leverage 2011 Revenue Contribution by Metal • Majority of earnings are presently from copper • Excellent copper growth available through Tenke • Excellent leverage to zinc through Lombador and Zinkgruvan Note: This analysis excludes revenues from Tenke. 4
Slide 5: Corporate Initiatives – Progress Report
Corporate Initiatives – Progress Report • Enhance operations performance and debottlenecking • Aggressive exploration program: Neves-Corvo • Restart production at Aguablanca prior to year end • Promote value awareness and expansion at Tenke • Capital investment: $130M sustaining capex and $280M new
Slide 6: Strong Financial Position
Strong Financial Position • Excellent Rebuilding of Balance Sheet Cash: +434% Debt: -90% Net Cash: +$502M 6
Slide 7: Q1/2012 Highlights – Great Start to Year
Q1/2012 Highlights – Great Start to Year Financials: Net Income: $58 million ($0.10 p/s) Operating CF (b/f non-cash WC): $64 million ($0.11 p/s) Attributable Operating CF from Tenke: $31 million which was used to fund sustaining capex and expansion initiatives Net Cash: $242 million vs. $236
Slide 8: Existing Assets and Projects – Growth Profile
Existing Assets and Projects • Growth Profile Based on Current Guidance (Mid-point of guidance range graphed below. Does not include expansions of Tenke beyond Phase II , Semblana or Touro Copper Project) Copper: +24% Zinc: +25% Nickel: restart 8
Slide 9: Neves-Corvo
Neves-Corvo • Record tonnes mined and milled in 2011 • 2011 production – 74.1kt Cu @ C1 costs of $1.76/lb • Q1/12 production – 16.6kt Cu @ C1 costs of $1.63/lb • Q1/12 copper grades of 2.9% and record recovery rate of 91% • New Zinc circuit (50ktpa Zn metal capacity) working well - flexible for both
Slide 10: Neves-Corvo Production Profile
Neves-Corvo Production Profile Midpoint of guidance targets 10
Slide 11: Neves-Corvo – 2012 Outlook
Neves-Corvo – 2012 Outlook • Copper production increases possible depending on price • Capital investment: Sustaining $57M, New Projects $63M • Internal ramp to explore/access Semblana commenced • Lombador Phase 1 underground project advancing on track • Semblana and “new target” drilling program pr
Slide 12: Neves-Corvo Exploration Targets
Neves-Corvo Exploration Targets 12
Slide 13: Zinkgruvan
Zinkgruvan • Annual record for tonnes mined and milled achieved in 2011 • New quarterly record for tonnes mined and milled in Q1/12 • 2011 zinc production of 75.1kt @ C1 cost of $0.30/lb Zn • Q1/12 zinc production of 20.4kt @ C1 cost of $0.22/lb Zn • Mine continues to outpace mill capacity • New cop
Slide 14: Zinkgruvan - Outlook
Zinkgruvan - Outlook • Pursuing opportunities for incremental improvements • Debottlenecking to increase mill capacity • Increased investment in underground exploration 14
Slide 15: Zinkgruvan Production Profile
Zinkgruvan Production Profile Midpoint of guidance targets 15
Slide 16: Aguablanca – Update and Outlook
Aguablanca – Update and Outlook • Re-instatement of the ramp and pre-stripping progressing well • Restart nickel/copper production prior to year end • Pursuing other regional opportunities – copper focused exploration Location • Spain Ownership • 100% 2012 Production • 500 – 1,000 t Ni Guidance • 50
Slide 17: Aguablanca Production Profile
Aguablanca Production Profile Note: Operations were suspended in late-2010 due to a pit-slope failure Midpoint of guidance targets 17
Slide 18: Tenke Fungurume
Tenke Fungurume 18
Slide 19: Tenke Fungurume
Tenke Fungurume • Entering fourth year of production • 2011 production of 127.4kt Cu @ C1 costs of $1.07/lb • Q1/12 production of 36.1kt Cu @ C1 costs of $1.25/lb • 2011 attributable operating cash flow was $149 million • Phase 2 expansion to 195,000 tonnes remains on-time, on-budget • No cash calls
Slide 20: Tenke Total Production 2009-2013e
Tenke Total Production 2009-2013e Copper Cobalt (kMT) Note: Production guidance for 2013 is a LUN estimate and does not represent official guidance by operator Freeport McMoran Copper and Gold Inc. (“Freeport”) 20
Slide 21: Tenke Expansion Plans
Tenke Expansion Plans Phase 2 (Underway) • Expansion: 130-195 ktpa Cu, 15 ktpa Co • US$850M incremental expansion capex • Funding obligations split 70:30 FCX/LUN • Expected to be funded out of surplus cash • Scheduled startup late 2012 Future Possible Expansions • Potential Heap Leach of low grade o
Slide 22: Touro Copper Project - Overview
Touro Copper Project - Overview • Located in Galicia region in northwest Spain • Production of copper in 1970’s and 1980’s • Historical resource of 196 Mt @ 0.39% Cu (at 0.2% Cu cut-off) • Exclusive option agreement until Oct ‘12 to acquire 80% interest • Potential acquisition payments: • €10M on ex
Slide 23: Lundin Assets - Growth Through Exploration
Lundin Assets - Growth Through Exploration Exploration – 2012 investment of $50 million: • Portugal - Semblana drilling continues to intersect thick sections of resource-grade Cu mineralization. Drilling ramped up on new 3D seismic targets. • Ireland - Clare (Zn-Pb-Ag) properties - Multiple targets
Slide 24: Lundin Mining - Summary
Lundin Mining - Summary • High quality, long life reserves; exploration upside • A stake in Tenke - a unique, world-class copper mine • Strong balance sheet and ongoing cash flows • Fully-funded organic growth profile • High leverage to copper and zinc • Very compelling valuation Neves-Corvo Zinkgru
Slide 25: TSX: LUN OMX: LUMI
TSX: LUN OMX: LUMI