First Quantum Minerals Ltd. · TSX:FM
First Quantum Minerals — Investor Presentation (September 2011)
29 slides from First Quantum Minerals's investor presentation, September 2011
Slide 1: Growth
A SOLID TRACK RECORD A STRONG OPERATING AND FINANCIAL BASE TRIPLING PRODUCTION CAPACITY Growth www.first-quantum.com TSX: FM LSE: FQM LuSE: FQM 1 September 2011
Slide 2: Cautionary Note Concerning Forward-Looking Statements
Cautionary Note Concerning Forward-Looking Statements Some of the statements contained in the following material are forward looking statements and not statement of facts. Such statements are based on the current beliefs of management, as well as assumptions based on management information currently
Slide 3: First Quantum - A Compelling Investment
First Quantum - A Compelling Investment Total Shareholder Return First Quantum: January 2000 to August 2011 — A mid-tier and growing mining and metals First Quantum 3695.28% company currently producing LME grade "A" 2527.49% copper cathode, copper in concentrate and gold. Norilsk Southern Peru 2388.
Slide 4: A Solid Track Record of Results
A Solid Track Record of Results Revenue Earnings* Operating Cash Flow ($ millions) CAGR = 65% CAGR = 66% ($ millions) ($ millions) CAGR = 64% $557 $900 $2,378 $520 $772 $1,864 $419 $678 $1,740 $399 $637 $1,539 $564 $300 $1,095 $155 $237 $445 $114 $28 $46 *Before impairments and other adjustments 4
Slide 5: Strong Operating Base & Development Pipeline
Strong Operating Base & Development Pipeline Operations Projects Exploration – Kansanshi, Zambia — Ravensthorpe, Australia — Enterprise, Zambia – Guelb Moghrein, Mauritania — Kevitsa, Finland — Fishtie, Zambia — Sentinel, Zambia — Haquira, Peru Other Investment — Mopani (16.9%), Zambia 5
Slide 6: A Solid Platform
A SOLID Platform & FIRST QUANTUM 6 MINERALS LTD.
Slide 7: Operations – Kansanshi Copper/Gold Mine
Operations – Kansanshi Copper/Gold Mine • Located near Solwezi, Zambia • Copper-gold operation • Production began in 2005 • 2010 production — 231,124 tonnes of copper — 109,629 ounces of gold 7
Slide 8: Operations – Kansanshi Copper/Gold Mine
Operations – Kansanshi Copper/Gold Mine Multi-phase expansion: • Oxide circuit - Phase 1 to 7.2 Mtpa expected by Q1 2012 - Phase 2 to 12Mtpa expected at end of 2012 • Sulphide circuit - Addition of 16 Mtpa planned to begin in 2012 • Current aim to reach annual production of ~400,000 tonnes by end of
Slide 9: Operations – Guelb Moghrein Copper/Gold Mine
Operations – Guelb Moghrein Copper/Gold Mine • Located near Akjoujt, Mauritania • Copper-gold operation • Production began in 2006 • 2010 production — 36,969 tonnes of copper — 81,766 ounces of gold 9
Slide 10: Operations – Guelb Moghrein Copper/Gold Mine
Operations – Guelb Moghrein Copper/Gold Mine • Optimizing recent expansion • Increased throughput and enhanced recoveries will allow annual copper production to rise to ~50,000 tonnes • Ongoing exploration at and nearby focused on identifying additional feedstock to extend the life of the operation
Slide 11: Growth
A ROBUST PROJECT PIPELINE Growth 11
Slide 12: A Significant and Growing Copper Producer, An Emerging Nickel Producer
A Significant and Growing Copper Producer An Emerging Nickel Producer Copper Production Profile • Copper production objective: 1,200 000’s tonnes 900 – Triple production in 2015 to ~1.1M tonnes 600 – Expected to be world’s 5th largest 300 producer - • Nickel production objective: 04 05 06 07 08 09 1
Slide 13: Projects – Ravensthorpe Nickel Project
Projects – Ravensthorpe Nickel Project • Located in Western Australia • Open pit using conventional drill and blast, load and haul system • Processing plant using proven technology • Purchased in February 2010 for US$340 million • Estimated capital for modification of ~US$200 million 13
Slide 14: Projects – Ravensthorpe Nickel Project
Projects – Ravensthorpe Nickel Project • On schedule for commissioning in 2nd half 2011 • Average annual production of nickel metal: – 39,000 tonnes for the first five years – 28,000 tonnes over the life of mine • C1 cost estimate: – $5.00/lb nickel – $3.00/lb without realization • Assumptions: nick
Slide 15: Projects – Kevitsa Nickel/Copper Project
Projects – Kevitsa Nickel/Copper Project • Located in northern Finland • Open pit mine – estimated measured and indicated resources of 240 million tonnes grading 0.30% nickel; 0.28 nickel sulphide; 0.41% copper; using a nickel cut-off grade of 0.1% • Conventional processing to produce two concentrat
Slide 16: Projects – Kevitsa Nickel/Copper Project
Projects – Kevitsa Nickel/Copper Project • At initial capacity average annual production – 10,000 tonnes of nickel – 20,000 tonnes of copper • LOM C1 cost estimate of $2.50/lb nickel, net of by product credits • Assumptions: – nickel = $6.75/lb; copper = $2.00/lb; Euro/US = 1.35 • Capital cost estim
Slide 17: Projects – The Trident Project
Projects – The Trident Project • Located in Northwestern Province – ~150 kilometres from the Kansanshi mine • Acquired in January 2010 for ~$260 million • Trident project comprises: – Sentinel copper deposit – Enterprise target – Intrepid target • Land use licenses obtained 17
Slide 18: Projects – The Sentinel Deposit
Projects – The Sentinel Deposit • EIA and land use agreement approved and obtained • Resource drilling complete; finalization of resource estimate expected in late 2011 • Excellent continuity of mineralization • Mining and processing conditions appear relatively straightforward 18
Slide 19: Projects – The Sentinel Deposit
Projects – The Sentinel Deposit • Proceeding with design of a project to initially produce 150,000 tonnes of copper in concentrate annually • Rising up to 300,000 tonnes of copper in concentrate • Production target could increase once resource estimate finalized • Initial design has commenced; long-
Slide 20: Projects – New Copper Smelter
Projects – New Copper Smelter • Compelling economics • Limited smelter capacity in Zambia currently • Facility would be dedicated to production from Kansanshi and Sentinel • Benefits include: – Production of sulphuric acid for use in Kansanshi’s oxide circuit – Existing infrastructure – Available wo
Slide 21: Projects – Haquira Copper Deposit
Projects – Haquira Copper Deposit • Acquired in December 2010 • Large scale copper project located in southern Peru – M&I resource of 3.7 million tonnes of copper equivalent and an inferred resource of 2.4 million tonnes of copper equivalent • Current priorities: – Expanding infill and condemnation
Slide 22: Copper Industry
Copper Industry & FIRST QUANTUM = ** MINERALS L’
Slide 23: Surpluses Overestimated & Deficits Underestimated
Surpluses Overestimated & Deficits Underestimated • Market often underestimates future demand and overestimates future supply • Leads to increased price volatility Source: Brook Hunt 23
Slide 24: Copper Grades Have Declined Significantly
Copper Grades Have Declined Significantly • Copper grades have declined significantly over the past 15 years • This trend is set to continue Source: Brook Hunt & Broker Research 24
Slide 25: Emerging Markets - Substantial Growth Ahead
Emerging Markets - Substantial Growth Ahead • Emerging economies experiencing significant growth • Still a long way to go for the vast majority of the world’s population • Brazil and China only at levels experienced by the US and UK in the 1920s Source: Maddison 25
Slide 26: Projected Impact on the Copper Market
Projected Impact on the Copper Market Source: International Copper Study Group 26
Slide 27: A Rapidly Growing Mining & Metals Company
A Rapidly Growing Mining & Metals Company • Unique technical strength at the core of the strong track record of delivery • Existing operations provide a solid platform to support growth • Strong financial position and cash flow • ~$2 billion investment in growth over 2011 – 2015 to significantly inc
Slide 28: Growth
A SOLID BASE A POSITION OF STRENGTH A ROBUST PROJECT PIPELINE Growth www.first-quantum.com TSX: FM LSE: FQM LuSE: FQM 28 September 2011
Slide 29: Corporate Profile
Corporate Profile Stock exchange listings & symbols – (S&P/TSX 60 Index) TSX: FM LSE: FQM LuSE: FQM Shares issued and outstanding 476.3 million Fully diluted 476.3 million 52-week share price range C$29.43 – C$12.28 Recent share price – September 2, 2011 C$22.71 Market capitalization – $ millions C$
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