Lundin Mining Corporation · TSX:LUN
Lundin Mining — Investor Presentation (November 2016)
34 slides from Lundin Mining's investor presentation, November 2016
Slide 1: Corporate Update November 2016
TSX: LUN OMX: LUMI Corporate Update November 2016
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward-Looking Information and Non-GAAP Performance Measures This presentation contains forward-looking information, including, but not limited to, guidance on estimated annual production and cash costs. This forward-looking information is not based on histor
Slide 3: Lundin Mining
Lundin Mining High Quality Competitive Mines • Positive operating cash flows at all mines despite a low commodity price environment Meaningful Production Scale/Growth • Internal growth projects and exploration upside at all mines Conservative Balance Sheet • Cash on hand of $691 million • $350 milli
Slide 4: Globally Diversified Portfolio
Globally Diversified Portfolio Zinkgruvan Freeport Cobalt1 Zinc-Lead-Copper Cobalt Refinery (Sweden) (Finland) Eagle Nickel-Copper (USA) Neves-Corvo Copper-Zinc (Portugal) Tenke Fungurume1 Copper-Cobalt (DRC) Candelaria2 Copper-Gold-Silver (Chile) • Operations: 6 underground mines and 1 large open p
Slide 5: YTD 2016 Operating Highlights
YTD 2016 Operating Highlights Positioned to meet or exceed guidance on strong aggregate operating performance All mines continue to generate operating cash flow despite low commodity prices • Candelaria copper production guidance raised to reflect year-to- Copper date performance/production expe
Slide 6: YTD 2016 Revenue Breakdown
YTD 2016 Revenue Breakdown • Majority of sales were from Candelaria with good contribution from each of Neves-Corvo, Eagle and Zinkgruvan • 65% of sales derived from copper; increasing contribution from zinc revenues YTD Sales Breakdown by Mine YTD Sales Breakdown by Metal Zinkgruvan Lead Other 3% 3
Slide 7: Balance Sheet Strength and Flexibility
Balance Sheet Strength and Flexibility • Net debt position improved by $133M during 2016 to $309M • Cash position YTD increased by $135M to $691M • $350M revolving credit facility amended at lower borrowing costs and extended to June 2020 Liquidity Position (Sep. 30, 2016) Cash and Cash Equivalents
Slide 8: 2016 Capital Expenditure and Exploration Guidance
2016 Capital Expenditure and Exploration Guidance Focus on disciplined capital investment and financial flexibility in light of the commodity price environment Capital Expenditures1 (US$M) 2016 • Capital expenditures for 2016 decreased by $25M (from Total Capitalized Stripping2 35 original $220M out
Slide 9: 2016 Production and Cash Cost Guidance
2016 Production and Cash Cost Guidance Metal and Mines Production (Tonnes)1 C1 Cash Costs2 Candelaria (80%) 130,000 – 132,000 $1.35/lb Eagle 22,000 – 24,000 Neves-Corvo 48,000 – 51,000 $1.55/lb Copper Zinkgruvan 1,900 – 2,000 Tenke (@24%) 52,800 $1.26/lb Total attributable 254,700 – 261,800 Nickel E
Slide 10: Operational Overview and Outlook
Operational Overview and Outlook Eagle (100%) Neves-Corvo (100%) Candelaria (80%) Zinkgruvan (100%) Tenke Fungurume (24%) 10
Slide 11: Candelaria (Cu/Au/Ag), Chile
Candelaria (Cu/Au/Ag), Chile Atacama Province, Region III, approximately 20 km south of Copiapó 11
Slide 12: Candelaria Results and Outlook
Candelaria Results and Outlook Location Chile • YTD copper production of 117.5 kt (100%) and Ownership 80% cash costs of $1.28/lb 2016 Production 130,000-132,000 t Cu • Los Diques Tailings Project progressing on Guidance (80%) schedule, trending under budget 2016 Cost Guidance $1.35/lb Cu Expected M
Slide 13: Candelaria Complex LOM Copper Production Profile
Candelaria Complex LOM Copper Production Profile1 200 180 174 161 163 165 154 156 145 146 160 144 123 140 125 115 125 120 110 112 97 100 KT 80 60 60 40 20 0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Cu (kt) - New Cu (kt) - Old • Profile reflects September 2
Slide 14: Los Diques Project Construction
Los Diques Project Construction • As of October 5, 2016 – Excavation of Underdrains Progress 14
Slide 15: Eagle Mine (Ni/Cu), Michigan, U.S.A.
Eagle Mine (Ni/Cu), Michigan, U.S.A. 50 km northwest of Marquette in the Upper Peninsula of Michigan 15
Slide 16: Eagle Results and Outlook
Eagle Results and Outlook • YTD production of 18.9 kt Ni and 17.7 kt Cu Location Michigan, USA Ownership 100% • Cash cost of $1.85/lb YTD, lower than 2016 23,000–25,000 t Ni $2.01/lb comparable period in 2015 Production Guidance 22,000–24,000 t Cu • Eagle East Feasibility Study on schedule for 2016
Slide 17: Eagle East – Potential Meaningful Addition to Profile
Eagle East – Potential Meaningful Addition to Profile • Preliminary Economic Assessment on Eagle East completed in June 2016* Nickel Production Copper Production 25 25 20 20 15 15 KT KT 10 10 5 5 0 0 2016 2017 2018 2019 2020 2021 2022 2023 2016 2017 2018 2019 2020 2021 2022 2023 Year Year Eagle Eagl
Slide 18: Neves-Corvo (Cu/Zn), Portugal
Neves-Corvo (Cu/Zn), Portugal Situated 220 km southeast of Lisbon 18
Slide 19: Neves-Corvo Results and Outlook
Neves-Corvo Results and Outlook • Zinc production of 53.6 kt YTD. Excellent Location Portugal recoveries on improvements in zinc plant Ownership 100% operation 2016 Production 48,000–51,000 t Cu Guidance 70,000–73,000 t Zn • YTD copper production of 35.6 kt impacted 2016 Cost Guidance $1.55/lb Cu by
Slide 20: Zinkgruvan (Zn/Pb/Cu), Sweden
Zinkgruvan (Zn/Pb/Cu), Sweden Situated 200 km southwest of Stockholm 20
Slide 21: Zinkgruvan Results and Outlook
Zinkgruvan Results and Outlook • Zinc production of 58.8 kt YTD Location Sweden Ownership 100% • YTD cash costs of $0.37/lb Zn lower than 2016 Production 80,000–85,000 t Zn corresponding period in 2015 Guidance 1,900-2,000 t Cu 2016 Cost Guidance $0.40/lb Zn • 1350 Zinc Expansion Project on schedule
Slide 22: Tenke Fungurume (Cu/Co), DRC
Tenke Fungurume (Cu/Co), DRC Situated 175 km northwest of Lubumbashi 22
Slide 23: Tenke Results and Outlook
Tenke Results and Outlook • Copper production of 161.7 kt (100%) YTD. Location Democratic Republic of Congo Record copper production in Q3 2016 Ownership 24% 2016 Production Guidance 52,800 t Cu • Cobalt production of 12.7 kt (100%) YTD (attributable share) on plan. 2016 Costs1 $1.26/lb Cu Expected
Slide 24: Lundin Mining Well Positioned in Any Market
Lundin Mining Well Positioned in Any Market Diversified Base Metal Producer High Quality Competitive Mines Meaningful Production Scale Strong Cash Flow and Margins Conservative Balance Sheet 24
Slide 25: Appendices
TSX: LUN OMX: LUMI Appendices
Slide 26: Production Outlook 2016-2018
Production Outlook 2016-2018 Attributable Production Outlook 2016 – 20181 (contained tonnes) 2016 2017 2018 Candelaria (80%) 130,000 – 132,000 120,000 – 125,000 113,000 – 120,000 Eagle 22,000 – 24,000 17,000 – 20,000 14,000 – 17,000 Copper Neves-Corvo 48,000 – 51,000 50,000 – 55,000 50,000 – 55,000
Slide 27: Candelaria Integrated Mining Complex
Candelaria Integrated Mining Complex Alcaparrosa • Successful operating Tierra Amarilla Mine track record • Large prospective Santos Mine regional mineral property position Candelaria near mine Norte Ojos-Plant PAC • Opportunity to continue to extend Candelaria Open Pit mine life with Magnetite Plan
Slide 28: Eagle Mine and Eagle East Deposit Overviews
Eagle Mine and Eagle East Deposit Overviews Grade Ni Grade Cu Contained Ni Contained Cu K Tonnes (%) (%) (kt) (kt) Eagle P&P 3,717 2.5 2.2 95 82 M&I 3,671 3.3 2.7 119 99 Inferred 44 1.1 1.1 0.5 0.5 Eagle East Inferred 1,180 5.1 4.3 61 51 28
Slide 29: Eagle East Update
Eagle East Update • Feasibility Study targeted for completion by year end 2016 • Development ramp commenced on July 12, 2016 29
Slide 30: Neves-Corvo Site Overview
Neves-Corvo Site Overview Grade Contained Grade Contained Copper K Tonnes (%) (k tonnes) Zinc K Tonnes (%) (k tonnes) P&P 26,139 2.7 694 P&P 23,449 7.2 1,678 M&I 69,986 2.7 1,857 M&I 106,819 6.1 6,527 Inferred 12,758 1.7 222 Inferred 11,386 4.4 499 30
Slide 31: Zinkgruvan Site Overview
Zinkgruvan Site Overview Grade Zn Grade Pb Contained Zn Contained Pb K Tonnes (%) (%) (k tonnes) (k tonnes) P&P 10,770 8.0 3.3 861 354 M&I 16,090 9.4 3.9 1,511 627 Inferred 7,862 8.3 3.6 653 283 31
Slide 32: Tenke Fungurume Site Overview
Tenke Fungurume Site Overview Grade Cu Grade Co Contained Cu Contained Co (100% Basis) K Tonnes (%) (%) (k tonnes) (k tonnes) P&P 144,362 2.6 0.4 3,760 510 M&I 680,341 2.5 0.3 16,857 1,832 Inferred 531,651 2.2 0.2 11,594 1,291 32
Slide 33: NI 43-101 Compliance
NI 43-101 Compliance Unless otherwise indicated, Lundin Mining Corporation has prepared the technical information in this presentation (“Technical Information”) based on information contained in the technical reports and news releases (collectively the “Disclosure Documents”) available under Lundin
Slide 34: Thank You
TSX: LUN OMX: LUMI Thank You
Lundin Mining — Investor Presentation (November 2016) on 6ix