First Quantum Minerals Ltd. · TSX:FM
First Quantum Minerals — Investor Presentation (March 2003)
47 slides from First Quantum Minerals's investor presentation, March 2003
Slide 1: Building A Low Cost, Mid-Tier Copper Producer
Building A Low Cost, Mid-Tier Copper Producer March, 2003
Slide 2: Clive Newall, President
Clive Newall, President Tel: +44 1403 273484, Email: clive.newall@first-quantum.com 2
Slide 3: Presentation Outline
Presentation Presentation Outline Outline Overview of First Quantum Minerals Ltd. Zambia & The Copperbelt Bwana Mkubwa SX/EW Facility / Lonshi Copper Mine Kansanshi Copper Deposit Investment Highlights Management 3
Slide 4: Overview
Overview Overview Focused on copper production from the Copperbelt region Established in 1996 Copper production commenced in 1998 Significant assets: - 100% of Bwana Mkubwa SX/EW Facility - 100% of Lonshi Copper Mine - 80% of Kansanshi Copper Deposit - 16.9% of Mopani Copper Mines Plc - 17.4% of Anv
Slide 5: Corporate Structure
Corporate Corporate Structure Structure Operating Assets Investments 100% 100% 80% 16.9% 17.4% COMISA BwanaMkubwa MkubwaMining Mining KansanshiMines Mines MopaniCopper CopperMines Mines AnvilMining MiningNL NL COMISA Bwana Kansanshi Mopani Anvil 100% 100% 100% 100% 100% Lonshi Bwana Kansanshi Nkana
Slide 6: Share Structure
Share Share Structure Structure Listed Toronto Stock Exchange Symbol “FM” Listed London Stock Exchange Symbol “FQM” Issued 49.0 million Fully Diluted 52.4 million 52 week range C $2.60 - $4.60 Recent Share Price (2/3/03) C $4.20 Market Capitalization (issued) C $206 million Institutional Ownership ~
Slide 7: Corporate Mission
Corporate Corporate Mission Mission To build a mid-tier international copper company • Operate low cost mines • Leverage advantage in the Copperbelt region • Use unique management expertise to build new mines for less capital than typical industry norms • Expand internationally through the acquisiti
Slide 8: Objectives 2002-2003
Objectives Objectives 2002-2003 2002-2003 Bwana Mkubwa / Lonshi • Increase copper production to 66 million pounds per year • Expand reserves / resource at Lonshi Kansanshi • Complete bankable feasibility study • Secure project financing • Begin construction Business Development • Continue to evaluat
Slide 9: Zambia & The Copperbelt
Zambia Zambia & & The The Copperbelt Copperbelt Lusaka 9
Slide 10: Zambia & The Copperbelt
Zambia Zambia & & The The Copperbelt Copperbelt Zambia Stable democracy Long mining history Attractive fiscal policy Mining accounts for 85% of FOREX & 50% of GDP Copper Belt One of worlds greatest concentrations of copper & cobalt Continuous production since 1920’s Skilled workforce Established inf
Slide 11: Bwana Mkubwa \ Lonshi
Bwana Mkubwa \ Lonshi 11
Slide 12: Copperbelt Location Map
Copperbelt Copperbelt Location Location Map Map 12
Slide 13: Bwana Mkubwa / Lonshi Highlights
Bwana Bwana Mkubwa Mkubwa // Lonshi Lonshi Highlights Lonshi resource – 7.3 million tonnes @ 4.91% copper (785 million pounds of copper) Expansion from 22 million lbs to 66 million lbs of copper per year Commissioning underway Cash costs estimated at $0.30/ lb, net of acid credits Sulphuric acid pro
Slide 14: Lonshi Mine
Lonshi Lonshi Mine Mine Stockpile (Sept 02) 706,171 T @ 5.1% ASCu or 79M lbs Cu ASCu = acid soluble copper 14
Slide 15: Bwana Mkubwa - Production
Bwana Bwana Mkubwa Mkubwa -- Production Production Copper Production Cash Cost 80 0.80 Copper production (million pounds) 70 0.70 60 0.60 Cash Cost ($/lb) 50 0.50 40 0.40 30 0.30 20 0.20 10 0.10 0 0.00 1998 1999 2000 2001 2002e 2003e 2004e 15
Slide 16: Bwana Mkubwa Annual Cash Flow Sensitivity
Bwana Bwana Mkubwa Mkubwa Annual Cash Flow Sensitivity $43 (US$ millions) $36 $30 $23 $0.65 $0.75 $0.85 $0.95 Copper Price (US$/lb) assumes 66 million lbs / year @ cash cost of $0.30/lb net of credits 16
Slide 17: Kansanshi Deposit
Kansanshi Deposit 17
Slide 18: Kansanshi Project
Kansanshi Kansanshi Project Project 18
Slide 19: Contained Metal Value Per Tonne Ore In Major Copper Projects
Kansanshi Kansanshi Project Project Contained Metal Value Per Tonne Ore In Major Copper Projects Sossego $27.43 (CVRD) Salobo $26.38 (CVRD) Kansanshi $26.28 (First Quantum) Esperanza $21.52 (Antofagasta) Spence $20.94 (BHP Billiton) Boyongan $20.93 (Philex/Anglo American) El Pachon $18.63 (Noranda)
Slide 20: Kansanshi Project (GRD Minproc Study)
Kansanshi Kansanshi Project Project (GRD (GRD Minproc Minproc Study) Study) Phase One Highlights (Years 1-16) M&I Resource of 7.8 billion lbs of Cu & 1.6 million ozs of Au (302 million tonnes grading 1.17% Cu & 0.17g/t Au) Annual production: 225 million lbs Cu & 25,000 ozs Au Estimated cash cost of
Slide 21: Kansanshi Production Statistics
Kansanshi Kansanshi Project Project (GRD (GRD Minproc Minproc Study) Study) Production Statistics Phase 1 Phase 2* (Years 1-16) (Years 17-28) Strip Ratio 1.4 2.1 Waste Tonnes 199 Mt 389 Mt ROM Tonnes 143 Mt 188 Mt In Situ Cu Grade 1.43 % 0.88 % In Situ Au Grade 0.22 g/t 0.12 g/t Total Cathode Cu Pro
Slide 22: Kansanshi Project - Section
Kansanshi Kansanshi Project Project -- Section Section 22
Slide 23: Kansanshi Project - Production
Kansanshi Kansanshi Project Project -- Production Production Cathode Concentrate 300 Copper production (million pounds) 275 250 225 200 175 150 125 100 75 50 25 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Year 23
Slide 24: Kansanshi Project Economics – Phase One
Kansanshi Kansanshi Project Project (GRD (GRD Minproc Minproc Study) Study) Project Economics – Phase One (Years 1-16) Net Present Value Calculation Capital Cost $163 M Gold Price $330 oz DFS Sensitivity Analysis Copper Price $0.72 $0.75 $0.80 $0.85 $0.90 discount rate of 10% $228M $277M $358M $439M
Slide 25: Kansanshi Project Financing
Kansanshi Kansanshi Project Project Project Financing $163 million capital cost estimate (GRD Minproc) $120 million Standard Bank Group & West LB AG ($60 million commercial facility, $60 million export credit facility) $10 million special warrant financing (RBC Capital Markets) European Investment B
Slide 26: Kansanshi Development Timeline – Phase One
Kansanshi Kansanshi Project Project (GRD (GRD Minproc Minproc Study) Study) Development Timeline – Phase One (Years 1-16) 2003 2004 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 Environmental Approval 2 Resolution of Fiscal and Commercial Issues 3 Financing Completed 4 Power Contract Finalised 5. Plant and Infrastructu
Slide 27: Exploration
Exploration 27
Slide 28: Exploration
Exploration rS KOLWEZ! sg * TENKEFUNGUNUME x ~, %, KAMBOVE sa, First Quantum Exploration Pro 4 EU RIE yy SEABHANDK Picross i 4 R c x LUISHIA {BBD Other First Quantum Exploration Property % ~~ Major Copper Deposit/Mine 7 LR] Mine Operated by Mopani Copper ANGOLA EUKUR| ® Mine Operated by First Quantu
Slide 29: Outlook
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Slide 30: Attributable Copper Production
Attributable Attributable Copper Copper Production Production 327 (million pounds) 277 266 250 189 200 111 102 72 66 25 90 50 22 66 77 77 77 77 22 21 22 2000(a) 2001(a) 2002(e) 2003(e) 2004(e) 2005(e) 2006(e) 2007(e) Bwana Mkubwa Kansanshi Mopani 30
Slide 31: Attributable Cash Cost Profile
Attributable Attributable Cash Cash Cost Cost Profile Profile $0.64 $0.42 $0.36 $0.36 $0.36 $0.32 $0.30 $0.25 2000(a) 2001(a) 2002(e) 2003(e) 2004(e) 2005(e) 2006(e) 2007(e) assumes cash costs of $0.30/lb at Bwana Mkubwa & $0.38/lb at Kansanshi 2003-2007 31
Slide 32: Copper Producers (2005)
Copper Production (million lbs) G Rio ru 0 500 1,000 1,500 2,000 2,500 po Tin Ph M to el ex ps ic Copper B Do o H P dge B ill So Fr ito ut e e n he po rn rt Pe Fa ru lc on MIM A nt brid of a g ge a Copper Producers N s to or an da W Source: RBC Capital Markets M Fi rs C tQ e T ua ck nt um Producers
Slide 33: Copper Producers – Cost Profile
Copper Copper Producers Producers –– Cost Cost Profile Profile 33
Slide 34: Investment Highlights
Investment Investment Highlights Highlights Pure Copper Play - Earnings and cash flow highly leveraged to copper Growth - Copper production to increase three fold in 2003 and twelve fold by 2005 Value - Trading at a large discount to Net Asset Value Blue Sky - On going exploration may lead to new mi
Slide 35: EPS & CFPS Estimates
EPS EPS & & CFPS CFPS Estimates Estimates Consensus Earnings & Cash Flow (seven analysts) (US$) Cu/lb EPS CFPS 2002 $0.71 ($0.04) $0.04 2003 $0.78 $0.31 $0.42 35
Slide 36: Research
Research Research Greg Barnes Cliff Hale-Sanders Ian Howat George Topping Haytham Hodaly Kerry Smith Daryl Hodges 36
Slide 37: Management Profiles
Management Profiles 37
Slide 38: Philip Pascall
Philip Philip Pascall Pascall Director, Chairman & CEO Mr. Pascall graduated from Sussex University in England with an honours degree in Control Engineering, and, after two years in oil exploration, completed an MBA at the University of Capetown. He has worked in general management positions in the
Slide 39: Clive Newall
Clive Clive Newall Newall Director, President Mr. Newall graduated from the Royal School of Mines, University of London, England in 1971 with an honours degree in Mining Geology, and was awarded an MBA from the Scottish Business School at Strathclyde University. He has worked in mining and explorati
Slide 40: Martin Rowley
Martin Martin Rowley Rowley Director, CFO Mr. Rowley graduated from the University of Western Australia with a Bachelor of Commerce degree. He worked as an accountant in both Australia and England, after which he joined the Bond Group of Companies as executive assistant to the Managing Director. He
Slide 41: Stuart Angus
Stuart Stuart Angus Angus Independent Director Mr. Angus graduated from the University of British Columbia with a law degree in 1973. For over 20 years, he has represented clients involved in mineral exploration and development. Mr. Angus was a founding partner of Angus, McClellan in 1986, focusing
Slide 42: Robert Watts
Robert Robert Watts Watts Independent Director Mr. Watts is a Chartered Accountant with wealth of experience in the mining industry. During his 30 year career, he has held senior management and executive positions including; Vice President- Treasurer, Placer Dome US; Executive Vice President, Pegasu
Slide 43: Rupert Pennant-Rea
Rupert Rupert Pennant-Rea Pennant-Rea Independent Director Mr. Rupert Pennant-Rea has had a varied career as economist, journalist, central banker and businessman. He was born and brought up in Zimbabwe, and has degrees in economics from Trinity College, Dublin and the University of Manchester. He h
Slide 44: Michael Philpot
Michael Michael Philpot Philpot Executive Vice President & Corporate Secretary Mr. Philpot, BSc, MBA, has been working in the mining industry since 1979 and has held executive positions with several mining companies including International CanAlaska Resources Ltd., International Freegold Mineral Dev
Slide 45: Alan Stephens
Alan Alan Stephens Stephens Vice President Exploration Mr. Stephens graduated from the Royal School of Mines in the United Kingdom in 1975 with an honours degree in Mining Geology. Prior to joining First Quantum, Mr. Stephens was Exploration Manager-International for Cyprus Amax with responsibility
Slide 46: Matt Pascall
Matt Matt Pascall Pascall Director of Operations Mr. Matt Pascall graduated from the University of the Witwatersrand with a B.Sc. in Mining Engineering and has an MBA from Cape Town University. He has worked in the base metals industry in Southern Africa, for Messina Transvaal, Rio Tinto and Newmont
Slide 47: Building A Low Cost, Mid-Tier Copper Producer
Building A Low Cost, Mid-Tier Copper Producer March, 2003
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