Lundin Mining Corporation · TSX:LUN
Lundin Mining — BofA Global Metals, Mining & Steel Conference 2023
50 slides from Lundin Mining's conference presentation, May 2023
Slide 1: Copper growth to supply our world’s transition
Copper growth to supply our world’s transition BofA Global Metals, Mining & Steel Conference 2023 TSX: LUN NASDAQ STOCKHOLM: LUMI
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward-Looking Information and Non-IFRS Performance Measures Certain of the statements made and information contained herein is “forward-looking information” within the meaning of applicable Canadian securities laws. All statements other than statements of hi
Slide 3: Copper growth to supply our world’s transition
Copper growth to supply our world’s transition We mine metals We produce at a We have the essential today and meaningful global financial strength for the world’s shift scale and are and operational to a lower carbon positioned for expertise to deliver future material growth on our goals
Slide 4: Our focus is base metals
Our focus is base metals The world now classifies them as critical Our Strategy – operate, upgrade and grow a base metals portfolio that provides leading returns for our shareholders throughout the cycle ▪ copper dominant portfolio ▪ long-life and cost-competitive assets Candelaria, Chile in establi
Slide 5: Strong Start to 2023
Strong Start to 2023 • solid operating performance across the portfolio Solid Operational • produced nearly 103,000 tonnes of copper-equivalent metal1 Performance • 9% increase in copper production and 10% increase in zinc production over Q4/22 • record quarterly zinc production at Neves-Corvo with
Slide 6: Q1/23 Summary Production Results
Q1/23 Summary Production Results Copper Nickel production of 61.5 kt production of 3.7 kt 64,096 63,930 4,719 61,462 56,552 4,379 4,096 3,724 • 9% increase over Q4/22 • impacted by downtime and • QOQ increases at Candelaria, Neves- rehab work on the main ramp Corvo, Eagle and Zinkgruvan at Eagle, as
Slide 7: Q1/23 Operating & Capital Costs
Q1/23 Operating & Capital Costs Candelaria Chapada Eagle Neves-Corvo Zinkgruvan Production costs $188M $69M $45M $86M $29M Cash cost1 $2.21/lb of copper $2.37/lb of copper $2.43/lb of nickel $1.69/lb of copper $0.54/lb of zinc Sustaining capex $91M $16M $7M $25M $14M • 7% improvement in production c
Slide 8: Q1/23 Key Financial Metrics
Q1/23 Key Financial Metrics Revenue Adjusted EBITDA1 Adjusted Earnings (Loss)1 of over $750M in Q1/23 of over $335M in Q1/23 of over $125M in Q1/23 $991M $588M $296M $751M $811M $337M $649M $192M $590M $354M $126M $202M $149M Q2/22 $31M ($35M) Q1/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1
Slide 9: Meaningful Scale & Material Growth
Cu Meaningful Scale Copper & Material Growth Copper Caserones Acquisition Production Profile1, 3 (kt) • large-scale, long-life copper operation with favorable cash flow generation Chapada • on a pro forma basis would have increased Lundin Mining's 2022 CUGEP Caserones consolidated copper production
Slide 10: Vicuña District Exploration Potential
Vicuña District Exploration Potential • significant potential to further increase value over the longer-term in the district leveraging Lundin Mining’s copper-focused exploration expertise • over 58,000 ha highly prospective and under explored land package to be acquired with Caserones. Abuts NGEx M
Slide 11: Zinc Production Growth Ramping Up
Zn Production Growth Production Profile2 (kt) Zinc Ramping Up 215 - 230 225 - 240 Top-15 Global Producer of Zinc in Concentrate 180 - 195 Neves-Corvo 159 • full ZEP mining and processing rates expected to be achieved on a sustainable basis during 2024 • updated Technical Report underpins current gui
Slide 12: Low-Cost Nickel Producer and Significant Gold Production Growth
Ni Low-Cost Au Significant Nickel Producer Gold By-Product Credits Eagle • significant gold production growth with development of Josemaria2, potential • only primary nickel mine in the U.S.A. expansion at Chapada and development of Saúva • produces high-quality nickel concentrate containing payable
Slide 13: Acquisition of a Majority Interest in the Caserones Copper Mine
Acquisition of a Majority Interest in the Caserones Copper Mine Future focused: a leader in responsible mining 13
Slide 14: Highly Complementary Acquisition
Highly Complementary Acquisition Totoralillo Pro Forma FY 2022 Metal Mix Revenue by Metal1, 2 Moly Other Caldera CHILE Other Gold ~75 km Gold Copiapó Zinc Zinc Over Over $3.0B in Revenue $4.1B Candelaria in Revenue Nickel Nickel Punta Padrones Port and Desalination Plant, Caldera Copper 63% Copper ~
Slide 15: Strong Rationale & Clearly Accretive
Strong Rationale & Clearly Accretive Caserones is a large-scale producer that provides copper growth while leveraging mutual synergies, infrastructure and efficiencies • ~50% pro forma increase in 2022 copper output • immediately accretive on key financial metrics • significant untapped exploration
Slide 16: Ideal Operator of Caserones
Ideal Operator of Caserones We know the region and its true potential very well Since Lundin Mining’s 2014 Acquisition of Candelaria: Mine life Nearly Over extended 160% 175% and production profile improved1 in forecast copper production in M&I Mineral Resource1,2 over the life-of-mine (2016-2046)1
Slide 17: Enhanced Production Profile
Enhanced Production Profile Pro Forma Caserones Impact to 2022A Production1 Copper Nickel Zinc Gold Silver Lead Molybdenum Copper Molybdenum Copper Equivalent kt Cu kt Mo kt CuEq2 557 3 374 +34% CuEq +50% Cu 417 250 374 374 250 250 - + + + 1. Production shown on a 100% basis for Candelaria and Caser
Slide 18: Strategic Copper Asset in Chile
Strategic Copper Asset in Chile Caserones Overview Historical Copper Production & Cost Profile1 kt Cu | US$/lb ▪ large-scale, open-pit mine located in the highly prospective Atacama region in Chile 25 5-Yr Average: 129kt Cu - ~800 km north of Santiago and ~160 km southeast 28 from the Copiapó airpor
Slide 19: Highly Prospective Land Package
Highly Prospective Land Package Aim to Achieve Similar Exploration Success as at Candelaria The acquired land package is within a well-known and highly prospective area: 58,525 hectares of total land area covered by granted and applied for mining concessions Map of Mining and Surface Land Ownership
Slide 20: Balance Sheet Remains Strong
Balance Sheet Remains Strong Net Debt1 Net Leverage US$90M as of May 3, 2023 Net Debt to 2022A EBITDA1,2 Lundin Mining $1,750M Adjusted EBITDA Only Lundin Mining + Caserones Adjusted & 0.69x Attibutable EBITDA2 Availability post 0.58x Acquisition $890M 0.07x $90M Revolving + Credit + Facility Note:
Slide 21: FY2022 Key Financial Metrics
FY2022 Key Financial Metrics Revenue1,2 Adjusted EBITDA1,2 Adjusted Earnings1,2 of over $4.1B of nearly $1.8B of over $550M $4,104 $1,769 $551 $483 $68 $1,063 $477 $3,041 $1,293 $483 $483 $3,041 $3,041 $1,293 $1,293 LUN Pro Forma LUN Pro Forma LUN Pro Forma Adjusted Operating Cash Flow1,2 Free Cash
Slide 22: Mining the metals essential today and for the world’s shift to a lower carbon future
Eagle Zinkgruvan Mining the Cu 2022A u/g Zn Cu 2022A 48 kt CuEq3 u/g 10+ years metals essential Ni Ag Co PGM 67 kt CuEq3 4+ years today and for the world’s shift to a lower carbon future Chapada 2022A Neves-Corvo Cu Au o/p Cu Zn 2022A u/g Ag 60 kt CuEq3 30+ years Pb Ag 68 kt CuEq3 10+ years Caserone
Slide 23: High Quality Operations, Meaningful Scale & Material Growth, Financial Strength
High Quality Meaningful Scale & Financial Operations Material Growth Strength TSX: LUN NASDAQ STOCKHOLM: LUMI
Slide 24: Appendix
Appendix :.... lundin mining
Slide 25: 2023 Guidance
2023 Guidance1 Production (t, oz; contained metal in conc.) Cash Cost2,3 Capital Expenditures2 ($M) Candelaria (100%) 145,000 - 155,000 $1.80 - $1.95 Sustaining Capital Chapada 43,000 - 48,000 $2.55 - $2.75 Candelaria (100% basis) 400 Cu Eagle 12,000 - 15,000 Chapada 70 Copper Neves-Corvo 33,000 - 3
Slide 26: Positive Outlook for Copper
Positive Outlook for Copper • 3rd most consumed metal globally Cu • ~3/4 of usage today is for power transmission and generation, building wiring, telecommunication, and electrical and electronics Copper • positive outlook largely driven by importance in the energy transition and inelastic mine supp
Slide 27: Zinc & Nickel are Essential to Modern Life
Zinc & Nickel are Essential to Modern Life • 4th most consumed metal with uses ranging from metal products to rubber and medicines Zn • ~3/4 of usage today is to protect from corrosion in galvanizing steel, diecasting alloys, etc. ~1/4 is consumed by rubber, chemical and agricultural industries Zinc
Slide 28: A Leader in Responsible Mining
A Leader in Responsible Mining Ambitious but achievable: our goal is to reduce Scope 1 & 2 GHG absolute emissions 35% by 20301 1. Compared to 2019 baseline year Committed assurance framework to promote the responsible production of copper Zinkgruvan Candelaria, Punta Padrones Port & Desalination Pla
Slide 29: Responsible Mining
Responsible Mining ✓ leading ISS Environment & Social Quality Scores ✓ CDP score of ‘B’, above industry and North American averages ✓ Candelaria’s operational water requirements met through reuse and make- up water from owned sea water desalination facility ✓ renewables increased to a minimum of 80%
Slide 30: Focused on the Future
Focused on the Future 35% Reduction in 7 Years • Scope 1 & 2 GHG absolute emissions reduction target of 35% by 2030 compared to our 2019 baseline year Embedding our Target 2022-2023 • baseline data is established and has been verified since 2014 • work is underway to ensure governance processes and
Slide 31: Tailings Management
Tailings Management • employ a comprehensive and integrated approach to tailings management. This provides confidence that potential environmental and social impacts can be reliably identified and minimized • our Responsible Mining Policy and Responsible Mining Management System (RMMS) include taili
Slide 32: Climate Change
Climate Change Climate Change, Energy and CHG Emissions • recognize the need for effective approaches to managing climate-related responsibilities, especially in consideration of the remote locations in which we operate, the energy-intensive nature of our industry, and the sometimes-limited availabi
Slide 33: Water Stewardship
Water Stewardship • continue to make water stewardship gains, achieving measurable reductions in freshwater use and increases in water re-use • committed to improvements in water assessment and management practices, evaluating water-use efficiency, initiatives to prevent unnecessary pressure on shar
Slide 34: Caserones Transaction Summary
Caserones Transaction Summary Lundin Mining to acquire a 51% equity interest in SCM Minera Lumina Copper Chile (“Lumina Copper”) Transaction • Lumina Copper operates the Caserones copper-molybdenum mine in Chile Upfront cash consideration of US$800M paid at closing, subject to any adjustments from t
Slide 35: Caserones Site Overview
Caserones Site Overview access to paved roads • linked to Copiapó via Site ~160 km asphalt/gravel Access road • easy access to ports Primary Crusher from Copiapó Mine Pit Dump Leaching Pad reliable power supply • 220 kV highly-reinforced Grinding Plant power line connected to Power the national grid
Slide 36: Candelaria
Candelaria 2023 Production & Cash Cost Copper, Gold Production & Cash Cost Outlook1 (100% basis; kt Cu, koz Au & $/lb Cu, net of by-product credits) • ore mining from the open pit is to be primarily from the upper benches of Phase 11 • cash cost to benefit from lower YOY electricity rate and consuma
Slide 37: Chapada
Chapada 2023 Production & Cash Cost Copper, Gold Production & Cash Cost Outlook1 • copper and gold production to be weighted to H2, due to the forecast grade (100% basis; kt Cu, koz Au & $/lb Cu, net of by-product credits) profiles and seasonal operating considerations • ore mining is planned from t
Slide 38: Eagle
Eagle 2023 Production & Cash Cost Nickel, Copper Production & Cash Cost Outlook1 • ore mining to continue from the Eagle and Eagle East orebodies with priority on (kt & $/lb Ni, net of by-product credits) increasing ore sourced from Eagle East during H2 • forecast cash cost increase compared to 2022
Slide 39: Neves-Corvo
Neves-Corvo 2023 Production & Cash Cost Copper, Zinc Production & Cash Cost Outlook2 (kt & $/lb Cu, net of by-product credits) • copper production is forecast to be equally weighted throughout the year • zinc production is forecast to increase over the course of 2023 as initiatives to enable ZEP to
Slide 40: Zinkgruvan
Zinkgruvan 2023 Production & Cash Cost Zinc Production & Cash Cost Outlook1 • zinc and copper production are forecast to be modestly H2 weighted (kt & $/lb Zn, net of by-product credits) • metal recovery rates and concentrate grades are anticipated to improve with completion of the sequential flotat
Slide 41: Josemaria Project
Josemaria Project Advancing Towards Development • progressing through establishment of an updated capital cost estimate and project execution schedule • 2023 expansionary capex1 guidance of $400M in support of advancing the project • capex primarily include continuation of detail engineering, procur
Slide 42: Josemaria Mineral Reserves Support Long Life
Josemaria Mineral Reserves1 Support Long Life Mineral Reserve Statement Long Section of Pit Phase Designs Contained Metal Tonnes Copper Gold Silver Copper Gold Silver Category (Mt) % g/t g/t (M lb) (M oz) (M oz) Proven 197 0.43 0.34 1.33 1,844 2.14 8.43 Probable 815 0.27 0.19 0.85 4,861 4.87 22.29 T
Slide 43: Josemaria Mineral Resources Offer Upside Potential
Josemaria Mineral Resources1 Offer Upside Potential Sulphide Mineral Resource Statement at 0.1% Copper Equivalent Cut-Off Oxide Mineral Resource Statement at 0.2 g/t Gold Cut-Off Contained Metal Contained Metal Tonnes Copper Gold Silver Copper Gold Silver Tonnes Gold Silver Gold Silver Category (Mt)
Slide 44: Caserones Historical Estimates
Caserones Historical Estimates1 Tonnes Grade Contained (As of April 2021) (Mt) (% CuT) (ppm Mo) (CuT kt) (Mo kt) Proven 419 0.35% -- 1,467 -- Probable 473 0.31% -- 1,466 -- 2P Reserves 892 0.33% -- 2,933 -- Measured 486 0.34% 129 1,659 63 Indicated 1,109 0.26% 97 2,924 108 M&I 1,595 0.29% 107 4,583
Slide 45: Non-GAAP and Other Performance Measures
Non-GAAP and Other Performance Measures Adjusted EBITDA, Adjusted Earnings Adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) and adjusted earnings are non-GAAP measures and are not a standardized financial measure under IFRS, the financial reporting framewor
Slide 46: Non-GAAP and Other Performance Measures cont.
Non-GAAP and Other Performance Measures cont. Net (Debt) Cash and Net (Debt) Cash / Adjusted EBITDA Net (debt) cash is a performance measure used by the Company to assess its financial position. Management believes that in addition to conventional performance measures prepared in accordance with IFR
Slide 47: Non-GAAP and Other Performance Measures cont.
Non-GAAP and Other Performance Measures cont. Adjusted Operating Cash Flow Free Cash Flow from Operations Adjusted operating cash flow per share is a performance measure used by the Company Free cash flow from operations is indicative of the Company’s ability to generate cash from to assess its abil
Slide 48: Non-GAAP and Other Performance Measures cont.
Non-GAAP and Other Performance Measures cont. C1 Cash Cost and All-in Sustaining Cost can be reconciled to Lumina Copper’s C1 Cash Cost cost of sales as follows: Copper, zinc and nickel cash costs per pound are key performance measures that management uses to For the Year Ended December 31, 2022 (fi
Slide 49: NI 43-101 technical information notice
NI 43-101 Unless otherwise indicated, Lundin Mining Corporation (the “Company”) has prepared the technical information in this presentation including Mineral Reserve and Mineral Resource estimates (“Technical Information”) based on information contained in the technical reports and news releases (co
Slide 50: www.lundinmining.com
www.lundinmining.com | TSX: LUN | Nasdaq Stockholm: LUMI
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