Taseko Mines Limited · TSX:TKO
Taseko Mines — Investor Presentation (March 2017)
26 slides from Taseko Mines's investor presentation, March 2017
Slide 1: Quality, Diverse Group of Mining Assets
Quality, Diverse Group of Mining Assets March 2017 TSX: TKO NYSE MKT: TGB 1
Slide 2: Forward Looking Statements
Forward Looking Statements Some of the statements contained in the following material are "forward‐looking statements". All statements in this release, other than statements of historical facts, that address estimated mineral resource and reserve quantities, grades and contained metal, and possible
Slide 3: NI 43-101 Compliance
NI 43‐101 Compliance Unless stated otherwise, Taseko Mines Limited (the “Company”) has prepared the technical information in this presentation including Mineral Reserve Mineral Resource estimates (“Technical Information”) based on information contained in the technical reports and news releases (col
Slide 4: Diversified Asset Base
Diversified Asset Base Gibraltar (Cu‐Mo) – 75% 4th largest open‐pit copper mine in North America Aley (Nb) – 100% 688 million tons P&P reserve, with add’l 3rd largest niobium deposit in the world resources expected to convert to reserves1 84 million tonne P&P reserve @ 0.50% 22 year mine life Nb2O5
Slide 5: Recent Results
Recent Results Strong Finish to 2016 – An Example of performance to come… • Strong production performance, copper price recovery & continued C$ weakness resulted in excellent fourth quarter results • Expect performance to continue throughout 2017 Copper Production – MM lbs Total Operating Costs (C1)
Slide 6: Gibraltar Silver Stream Sale for US$33 million
Gibraltar Silver Stream Sale for US$33 million Silver By‐Product Acquired by Osisko Gold Royalties • The C$44 million strengthens Taseko’s balance sheet and allows the Company to advance organic projects without any shareholder dilution • Silver makes up ~1% of Gibraltar’s total revenue • Reduced si
Slide 7: Gibraltar Copper Mine
Gibraltar Copper Mine Canada’s Second Largest Open‐Pit Copper Mine Location: 65 km north of Williams Lake, British Columbia Ownership: 75% 3.3 billion pounds recoverable copper Mineral Reserves: 62 million pounds recoverable molybdenum Total P&P Reserves Update (Dec 2016: 688m tons at 0.28% copper e
Slide 8: Gibraltar Copper Mine
Gibraltar Copper Mine GDP3 Expansion – New 30k tpd Concentrator (commissioned in 2013) 34’ SAG Mill 20’ Ball Mill 160m3 Float Circuit Operating at steady‐state 150 Gibraltar Production (100%, Mlbs Cu) after six years of expansion 120 activities Modernized mine stabilized at 90 reduced operating cost
Slide 9: Operating Costs
Operating Costs Focussed on Lower Cost per Ton Milled • Cost per ton milled sustained at low levels for past two years due to cost saving initiatives, including revised mine plan with lower strip ratio • Comparable open pit mines in South America at $15‐20 per ton milled Cost Per Ton Milled (C$) $13
Slide 10: Cost Benefits
Cost Benefits BC Advantage Low cost power ‐ $0.06/kWh vs. $0.15‐$0.20 elsewhere Established infrastructure in a favorable jurisdiction – highway access, rail, port, grid power (existing infrastructure funded by government) Skilled and efficient labor force – similar sized South American mine employs
Slide 11: Operating Costs
Operating Costs Total Operating Costs per Pound (C1) Head grade has significant impact on reported C1 cost Copper grade expected to average ~0.3% into 2017 compared to 0.26% in 2016 Operating costs, on a per pound basis, will be positively impacted by 2017 copper grade and ongoing cost reduction ini
Slide 12: Operating Margin Sensitivity
Operating Margin Sensitivity Highly levered to copper price recovery and further cost reductions C1 Costs (US$/lb) Operating Margin (C$, $1.80 $1.70 $1.60 $1.50 $1.40 $1.30 millions) $2.10 $55 $75 $95 $110 $130 $150 Cu Price (US$/lb) $2.30 $95 $110 $130 $150 $170 $185 $2.50 $130 $150 $170 $185 $205
Slide 13: Valuation Comparable
Valuation Comparable Teck’s Highland Valley Copper • Teck recently acquired the remaining 2.5% of their HVC Copper Mine in British Columbia • Applying the same valuation to Gibraltar: In situ recoverable pounds of copper Teck purchased (reserves) 82,000,000 Total paid (C$) $33,000,000 Total paid per
Slide 14: Florence Copper Project
Florence Copper Project A Near Term, Low Cost Copper Producer Location: Central Arizona near the community of Florence Ownership: 100% 345 million tons probable reserve grading 0.36% TCu (at a Mineral Reserves: 0.05% total copper cutoff) containing 1.7 billion pounds of recoverable copper1 Mine Type
Slide 15: Florence Copper Project: 2017 Technical Study
Florence Copper Project 2017 Technical Study In January, Taseko announced the results of a two‐year metallurgical test program as well as an optimization of the project well field development sequence The updated data was used to re‐cost the project which resulted in a significant improvement in pro
Slide 16: Florence Copper Project: Development costs and timeline
Florence Copper Project Project development costs and timeline Phase 1 – Production Test Facility (PTF): 2017 – construction & operation Phase 2 – Full scale production facility Permitting – 12 months (initiated during PTF operation) Construction – 18 months Copper production ‐ 2020 16
Slide 17: Aley Niobium Project
Aley Niobium Project Accretive Development Opportunity Location: Northern British Columbia Ownership: 100% Mine Type: Open Pit, 10,000 tpd mill throughput Mine Life: 24 years Project Highlights Proven and probable reserves of 84 million tonnes grading 0.50% Nb2O5 announced in September 2014 Pre‐tax
Slide 18: Copper Price Leverage
Copper Price Leverage Taseko Cash Flow to Benefit Most in Copper Price Recovery At At Spot Change 2017 CFPS Spot +10% +20% Spot +10% Spot +20% Copper Price $2.19 $2.41 $2.63 Large Cap FM $1.27 $1.40 $1.53 10% 20% FCX $2.69 $3.16 $3.63 17% 35% TCK C$4.20 C$4.41 C$4.61 5% 10% TRQ ($0.18) ($0.15) ($0.1
Slide 19: Sector Scarcity
Sector Scarcity TSX/TSXV Copper Producers ‐ 2008 Anvil Mining Ltd. Capstone Mining Corp. • Lack of publicly listed intermediate producers and Centenario Copper Corp. quality development assets stem from a decade of Copper Mountain Mining Corp. M&A and corporate activity with little to no new investm
Slide 20: Appendix
Appendix 20
Slide 21: Corporate Information
Corporate Information Cash on Hand (12/31/16): C$89 million LT Debt (12/31/16) : C$373 million Listed: TSX; TKO / NYSE MKT; TGB Shares Outstanding: 221.9 million Market Capitalization: ~C$400 million 52 Week High/Low: C$2.12/C$0.46; US$1.63/US$0.34 Analyst Coverage: BMO, Scotia Capital, National Ban
Slide 22: New Prosperity Project
New Prosperity Project One of the Largest Gold/Copper Porphyries in the World Location: 125 km south west of Williams Lake, British Columbia Ownership: 100% 7.7 million ounces recoverable gold Mineral Reserves: 3.6 billion pounds recoverable copper Mine Type: Open‐pit, 70,000 tpd mill throughput Min
Slide 23: Aley Niobium Project: What is Niobium
Aley Niobium Project What is Niobium Niobium Benefits in Steel $9 of Niobium used in a Car Specifically used in manufacturing high strength, low alloy steels Green technologies, turbines, aerospace, automobile steels, oil and gas Global annual consumption of ferro‐niobium is 210 million lbs/year Gro
Slide 24: Experienced Management Team
Experienced Management Team Russell Hallbauer, P. Eng ‐ President & CEO and Director – Mr. Hallbauer is a professional engineer with over 35 years of mining experience. He has a strong background in open pit and underground mining, overseeing operating joint ventures and revitalizing mines to profit
Slide 25: Reserves & Resources
Reserves & Resources Size Grade Recoverable Metal Contained Metal Gibraltar Category (at 0.15% Cu (M Tons) The resource and reserve estimation was completed by cut-off) Cu (%) Mo (%) Cu (B lbs) Cu (B lbs) Gibraltar mine staff under the supervision of Scott Jones, P.Eng., Vice President, Engineering
Slide 26: Reserves & Resources
Reserves & Resources Aley Category Grade Recoverable Metal Contained Metal The reserve estimation (effective date Sept 15 2014) was Size (M reviewed by Scott Jones, P.Eng., Vice-President Tonnes) Nb205 (%) Nb (M kg) Nb (M kg) Engineering for Taseko and a Qualified Person under National Instrument 43