Lundin Gold Inc. · TSX:LUG
Lundin Gold — Investor Presentation (August 2023)
43 slides from Lundin Gold's investor presentation, August 2023
Slide 1: Building a Leading Gold Company Through Responsible Mining
BUILDING A LEADING GOLD COMPANY THROUGH RESPONSIBLE MINING August 2023 CORPORATE PRESENTATION www.lundingold.com TSX, Nasdaq Stockholm: LUG OTCQX: LUGDF
Slide 2: Caution Regarding Forward-Looking Information and Statements
CAUTION REGARDING FORWARD-LOOKING INFORMATION AND STATEMENTS All statements, other than statements of historical fact, made and as Lundin Gold's actual results and future events could differ does not recognize them. “Inferred mineral resources" and information contained in this presentation and resp
Slide 3: Fruta del Norte: The First Large-Scale Gold Mine in Ecuador
FRUTA DEL NORTE THE FIRST LARGE-SCALE GOLD MINE IN ECUADOR Location: Zamora Chinchipe Province, Southeast Ecuador Ownership: Stage: Mine Type: 100% Producing Underground Life of Mine: Current Probable ~11 Years Reserves: 5.02 Million Oz Au Grading 8.68 g/t1 1. As at December 31, 2022 Slide 3 Lundin
Slide 4: A Unique Deposit
A UNIQUE DEPOSIT ONE OF THE PREMIER GOLD DISCOVERIES OF THE LAST 50 YEARS - LARGE MINERAL INVENTORY CONCENTRATED A IN SMALL VOLUME Breccias and veins domain: Volcanic and breccias domain: - 40-50 m average width - 30-40 m average width - 8-9 g/t average grade - 5-6 g/t average grade Slide 4 Lundin G
Slide 5: Strongly Positioned to Create Shareholder Value
STRONGLY POSITIONED TO CREATE SHAREHOLDER VALUE Operational Excellence Cash Flow Growth ESG Updated 2023 production and cost Significant cash flow generation Conversion drilling Focus on local community development guidance Gold Prepay Facility repaid in full Near-mine and regional exploration FDN i
Slide 6: Strong Operating Performance in Q2 2023
STRONG OPERATING PERFORMANCE IN Q2 2023 Q2 2023 H1 2023 129,731 oz 269,752 oz Gold produced Gold produced 85,395 oz 44,336 oz 173,631 oz 96,121 oz Gold as concentrate Gold as doré Gold as concentrate Gold as doré 418,373 11.0 g/t 810,705 11.6 g/t Tonnes milled Average Head Grade Tonnes milled Averag
Slide 7: Lundin Gold in the Lowest Quartile of the Global Gold AISC Curve
LUNDIN GOLD IN THE LOWEST QUARTILE OF THE GLOBAL GOLD AISC CURVE1 2000 H1 2023 AISC3 1800 Gold Price ~$1,914/oz2 Cash operating costs $644 1600 1400 Corporate social responsibility $4 All-In Sustaining Cost (US$/oz) 1200 Treatment and refining charges $74 1000 Accretion of restoration prevision $1 8
Slide 8: Guidance Upgraded Due to Strong Operating Results
GUIDANCE UPGRADED DUE TO STRONG OPERATING RESULTS Gold Production 425,000 – 475,000 450,000 – 485,000 oz gold oz gold AISC1 $870 – 940 $820 – 870 per oz gold sold per oz gold sold Cash Operating Costs1 $700 – 760 $650 – 700 per oz gold sold per oz gold sold 1. Please refer to pages 13 to 16 in the C
Slide 9: Three-Year Outlook Underscores Low Cost Nature of Fruta del Norte
THREE-YEAR OUTLOOK UNDERSCORES LOW COST NATURE OF FRUTA DEL NORTE 2023 2024 2025 450,000 - 485,000 450,000 - 500,000 465,000 - 515,000 Gold Production (oz) Gold Production (oz) Gold Production (oz) 45 - 55 25 - 35 45 - 55 Sustaining Capital ($ million) Sustaining Capital ($ million) Sustaining Capit
Slide 10: Cash Is King at FDN
CASH IS KING AT FDN In H1 2023, Lundin Gold generated $307 million in cash from operations and ended Q2 with a cash balance of $275 million, which supports debt repayments, near-mine, regional exploration and conversion drilling, planned capital expenditures, and dividends $307 $10 $(208) $(39) $(91
Slide 11: Strongly Positioned to Create Shareholder Value
STRONGLY POSITIONED TO CREATE SHAREHOLDER VALUE DEBT REPAYMENT ORGANIC DIVIDENDS GROWTH/ Based on guidance and current gold prices, Lundin Gold will M&A generate significant free cash flow1 for many years to come 1. Please refer to pages 13 in the Company's MD&A for the six months ended June 30, 202
Slide 12: Second Quarter of 2023 Balance Sheet
SECOND QUARTER OF 2023 BALANCE SHEET As at June 30, As at December 31, (Table expressed in US$’000) 2023 2022 Financial Position: Cash 274,968 363,400 Working capital 268,095 194,804 Total assets 1,508,831 1,668,865 Long-term debt Senior Debt Facility 91,676 172,854 Fair value of stream credit facil
Slide 13: Making Headway in Debt Consolidation Strategy
MAKING HEADWAY IN DEBT CONSOLIDATION STRATEGY PROJECT FINANCING PACKAGE On January 5th 2023, Lundin Gold prepaid in full the 10 remaining quarterly instalments of its GPP based on the Gold Prepay Credit Facility (“GPP”) price of gold late in December, through the payment of $207.5 million, inclusive
Slide 14: Dividend Above Industry Average
DIVIDEND ABOVE INDUSTRY AVERAGE Quarterly Payout Next Dividend Payment SIGNIFICANT CASH LEFT AFTER $0.10/sh September 27 DIVIDEND PAYMENT TO: (September 30 for shares trading on Nasdaq Stockholm) Gold Mining Industry Average Dividend Yields % - 20221 3.3% 3.2% Accelerate Carry out expanded debt expl
Slide 15: A Simple Approach to Exploration
A SIMPLE APPROACH TO EXPLORATION CONVERSION DRILLING › Replace depleted ounces and grow reserve base through conversion of inferred resources NEAR-MINE PROGRAM › Grow inferred resources through extension of known deposit and identification of new targets REGIONAL PROGRAM › Develop long-term gold inv
Slide 16: 2023 The Largest Drilling Program Since FDN Discovery
2023 THE LARGEST DRILLING PROGRAM SINCE FDN DISCOVERY CONVERSION DRILLING 7,600 metres Conversion Program costing $1.7M will be part of sustaining capital 7,500 Near Mine Drilling Expansion NEAR-MINE EXPLORATION 7,600 7,400 FDN Discovery 23,000 metres 7,400 $12.9M 26,200 26,200 28,000 26,200 REGIONA
Slide 17: 1.58 Moz Added to FDN Reserves
1.58 MOZ ADDED TO FDN RESERVES MORE THAN REPLACING MINED OZ SINCE THE BEGINNING OF OPERATIONS 2022 Mineral Reserves1 + 1.58 Moz 5.02 Moz 4.82 Moz Proven Probable Total Tonnage (Mt) 10.75 7.23 17.98 - 1.38 Moz Grade (g/t Au) 9.95 6.81 8.68 Contained Metal 3.44 1.58 5.02 (Moz Au) Grade (g/t Ag) 11.6 1
Slide 18: Conversion Drilling Has Improved Understanding of Deposit Geology
CONVERSION DRILLING HAS IMPROVED UNDERSTANDING OF DEPOSIT GEOLOGY 2.1 Moz 1.7 Moz A total of 18,340 metres of 3.2 Moz underground drilling across 88 drill holes was completed during 7.3 Moz 2021/22, the results of which have improved confidence in and further supported the geological model, and 3.6
Slide 19: 2023 – 2024 Conversion Program
2023 – 2024 CONVERSION PROGRAM OPPORTUNITY FOR FURTHER RECATEGORIZATION Conversion drilling program at FDN successfully replaced all mined Mineral Reserves since beginning of operations New Resource Model has identified areas for further conversion drilling Additional conversion drilling planned in
Slide 20: Conversion Program - High Grade Results Within the Mineral Envelope
CONVERSION PROGRAM - HIGH GRADE RESULTS WITHIN THE MINERAL ENVELOPE Results have increased confidence in the geologic model of the southern extension of the deposit and have revealed a vein type higher grade mineralization within the mineral inferred envelope Slide 20 Lundin Gold Corporate Presentat
Slide 21: Near-Mine Exploration in Full Swing
NEAR-MINE EXPLORATION IN FULL SWING THREE MAJOR FOCUSES SOUTH FDN EAST DEPTH EXTENSION AND WEST Near-mine exploration started in Q3 2022 and focuses on expanding the FDN mineral resource envelope and testing several unexplored opportunities near the mine In H1 2023, approximately 12,363 metres was d
Slide 22: Near-Mine Exploration Reports High Grade Intercepts
NEAR-MINE EXPLORATION REPORTS HIGH GRADE INTERCEPTS Initial drill results discovered two new mineralized zones to the south of the FDN deposit FDN South (“FDNS”) › Six drill holes completed in Q2 - reveal occurrence of a series of subparallel mineralized veins showing similar hydrothermal alteration
Slide 23: Near Mine Exploration Also Exploring at Depth
NEAR MINE EXPLORATION ALSO EXPLORING AT DEPTH Fruta Del Norte North-South Longitudinal Section (Looking East)- Drilling samples interpolation (Au) N N North-Central sector Southern extension S Au ppm >10 5- 10 3.5- 5 2- 3.5 1- 2 0- 1 +1200 FDN-C23-001 26.00m @ 4.08 g/t ( 90.80m) +900 500 metres 7780
Slide 24: Regional Exploration Expanding
REGIONAL EXPLORATION EXPANDING 7Km Drilling stage targets New targets 2,796 m completed in H1 2023 – second rig recently added to the program Q. La Negra Quebrada La Negra Crisbel Barbasco Major structure intercepted with Unexplored geochemical soil anomaly Puente Norte quartz veins, hydrothermal hi
Slide 25: Robust Exploration Target Pipeline - Balanced for Continued Growth
ROBUST EXPLORATION TARGET PIPELINE - BALANCED FOR CONTINUED GROWTH Proven & Probable Reserves Development Measured & Preliminary Economic Assessment, Scoping Indicated Resource Pre-Feasibility Study & Feasibility Study Inferred Conversion and Infill Drilling, Geo. Modelling, Resource Base Min. Res.
Slide 26: ESG Considered in Every Aspect of Our Activities
ESG CONSIDERED IN EVERY ASPECT OF OUR ACTIVITIES STRATEGIC PILLARS Health & Safety Climate Change TRIR (total recordable incident rate) Annual Climate Change report published. reduction for operations: 0.46 in 2021, Established GHG emissions reduction target, and and 0.30 in 2022 provided greater de
Slide 27: Industry Leading GHG Emissions Intensity
INDUSTRY LEADING GHG EMISSIONS INTENSITY Target: To be carbon neutral by 2030 with Industry leading GHG emissions (Scopes 1 and 2) intensity of respect to Scopes 1 and 2 emissions 0.06 tCO2e per ounce of gold produced in 2022 based on the current life of mine plan Credible and transparent pathway to
Slide 28: Mining Playing an Important Part in Ecuadorian Economic Growth
MINING PLAYING AN IMPORTANT PART IN ECUADORIAN ECONOMIC GROWTH Mineral Resources now $2.8 bn 4th represent one Mining exports in 2022 Mining products now represent the 4th largest export in Ecuador, after oil, prawns of Ecuador’s +33% vs. 2021) and bananas. top exports Lundin Gold will contribute $1
Slide 29: Level of Mining Acceptance - Perception Survey 2022
LEVEL OF MINING ACCEPTANCE - PERCEPTION SURVEY 2022 Identification Psychological Benchmark results in the Latin Confidence threshold America region vs. Yantzaza and Los Encuentros in 2022 ‘22 vs ‘21 Approval Yantzaza (0.64*) 1. Peru (0.57) Credibility threshold 2. Chile (0.55) 3. Bolivia (0.51) 4. C
Slide 30: Non-Executive Board of Directors, Management and Operations Team
NON-EXECUTIVE BOARD OF DIRECTORS, MANAGEMENT AND OPERATIONS TEAM Non Executive Board of Directors Jack Lundin Carmel Daniele Gillian Davidson Ian Gibbs Angelina Mehta Ashley Heppenstall Craig Jones Jill Terry Chairman Director Director Director Director Director Director Director Management Ron F. H
Slide 31: Corporate Structure
CORPORATE STRUCTURE (DATA AS AT AUGUST 25, 2023) CAPITAL MARKETS DATA SHAREHOLDERS TSX: LUG / OMX: LUG Market Capitalization Symbol 3,832 M / OTCQX: LUGDF (CAD) Share price (CAD/sh) 16.08 Cash Position (June 30, 2023) US$275 M 52 Week LT Debt (June 30, 2023) US$397 M Trading Range 8.50/19.42 17% Ret
Slide 32: Lundin Gold – Foundation for Value Creation
LUNDIN GOLD – FOUNDATION FOR VALUE CREATION Operational Excellence Cash Flow Growth ESG Slide 32 Lundin Gold Corporate Presentation | August 2023 TSX: LUG / OMX: LUG / OTCQX: LUGDF
Slide 33: Thank You
Contact information: Finlay Heppenstall - Director, Investor Relations finlay.heppenstall@lundingold.com +1 604-806-3089 BUILDING A LEADING GOLD COMPANY THROUGH RESPONSIBLE MINING THANK YOU TSX, NASDAQ STOCKHOLM: LUG OTCQX: LUGDF Lundin Gold Ecuador LundinGold LundinGold @LundinGold / LundinGoldEC w
Slide 34: Appendix
APPENDIX Slide 34 Lundin Gold Corporate Presentation | August 2023
Slide 35: FDN One of the Few Multi-Million Ounce, High-Grade Gold Assets in Production
FDN ONE OF THE FEW MULTI-MILLION OUNCE, HIGH-GRADE GOLD ASSETS IN PRODUCTION Operating mines with gold reserves > 4 million ounces Slide 35 Lundin Gold Corporate Presentation | August 2023 TSX: LUG / OMX: LUG / OTCQX: LUGDF
Slide 36: Second Quarter of 2023 Financial Highlights
SECOND QUARTER OF 2023 FINANCIAL HIGHLIGHTS Three Months ended Six Months ended June 30 June 30 (Tables are expressed in $’000, except share and per 2023 2022 2023 2022 share amounts, or unless otherwise stated) Net revenues 243,930 177,808 500,658 394,280 Income from mining operations 124,801 82,52
Slide 37: Free Cash Flow
FREE CASH FLOW1 Three Months ended Six Months ended June 30 June 30 (Tables are expressed in $’000, except share and 2023 2022 2023 2022 per share amounts, or unless otherwise stated) Net cash provided by operating 162,352 60,686 306,791 188,016 activities Net cash used for investing activities (13,
Slide 38: Proven and Probable Mineral Reserves of 5.02 Moz of Gold at 8.68 g/t
PROVEN AND PROBABLE MINERAL RESERVES OF 5.02 MOZ OF GOLD AT 8.68 G/T1 2016 Technical Report December 31, 20222 Mt 15.49 17.98 Au (g/t) 9.67 8.68 Au (Moz) 4.82 5.02 Ag (g/t) 12.70 11.40 Ag (Moz) 6.34 6.59 1. See slide 35 for information regarding the assumptions, parameters and risks associated with
Slide 39: Mineral Resources
MINERAL RESOURCES Notes to Proven and Probable Mineral Reserves 1. For information regarding the assumptions, parameters and risks associated with the Mineral Reserve estimate and NI 43-101 Mineral Resources, inclusive of Mineral other information required by NI 43-101, see the technical report enti
Slide 40: 42 km of Underground Mine Development Completed
42 KM OF UNDERGROUND MINE DEVELOPMENT COMPLETED1 1. As at March 31, 2023 Slide 40 Lundin Gold Corporate Presentation | August 2023 TSX: LUG / OMX: LUG / OTCQX: LUGDF
Slide 41: Process Plant Flow Diagram
PROCESS PLANT FLOW DIAGRAM ROM Ore 4,200 t/d Mine F80 = 15” Crushing To process Auxiliary systems Industrial P80 = 3.5” Rich Gravimetric Water concentrate solution Gravimetric Grinding ILR SR To Electrowinning To process concentration Reagent preparation P80 = 55 µm Tailings Concentrate Concentrate
Slide 42: Process Plant Operations
PROCESS PLANT OPERATIONS Slide 42 Lundin Gold Corporate Presentation | August 2023 TSX: LUG / OMX: LUG / OTCQX: LUGDF
Slide 43: Government Agreements
GOVERNMENT AGREEMENTS The Company has all the major agreements and permits with the Government of Ecuador in place THE EXPLOITATION AGREEMENT THE INVESTMENT PROTECTION AGREEMENT The Exploitation Agreement sets out the rights and obligations of the The Investment Protection Agreement primarily deals