Taseko Mines Limited · TSX:TKO
Taseko Mines — Investor Presentation (December 2021)
35 slides from Taseko Mines's investor presentation, December 2021
Slide 1: Building North America's Low-Cost Multi-Asset Copper Producer
BUILDING NORTH AMERICA’S LOW-COST MULTI-ASSET COPPER PRODUCER December 2021
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements and forward-looking information (collectively referred to as “forward-looking statements”) within the meaning of applicable Canadian securities legislation and the United States Private Securities Legislation Reform Act of 1995, Sectio
Slide 3: Taseko – Investment Highlights
Taseko – Investment Highlights Building a multi-asset copper producer in the world’s top mining jurisdictions C A N A D A B R I T I S H C O L U M B I A GIBRALTAR Strong Copper YELLOWHEAD Commitment to Strong Fundamentals ALEY Environmental, Social & Proven Team of Mine NEW PROSPERITY Governance Perf
Slide 4: Copper Price Outlook
Copper Price Outlook Copper prices declined in H1 2020 due to COVID-19 but have since rebounded to all-time highs Favourable long-term supply-demand dynamics ▪ Maturing global supply base and lack of project pipeline, with projects having long lead times ▪ Supply disruptions driven by impact of COVI
Slide 5: Electric Vehicles – A Rapidly Emerging Market
Electric Vehicles – A Rapidly Emerging Market Copper is Essential to Electric Vehicle Technology Copper is used throughout electric vehicles, charging stations and supporting infrastructure because of the metal’s Conventional Car 18 to 49 lbs 85 lbs durability, high conductivity and efficiency Hybri
Slide 6: A Foundation of Stable Cashflow
Gibraltar Copper Mine – British Columbia A FOUNDATION OF STABLE CASHFLOW MINE TYPE STAGE PRODUCTION (LoM) Open Pit – Cu/Mo Producing 135Mlbs (~60kt Cu) CASH COSTS (LOM) MINE LIFE REPLACEMENT VALUE US$1.80/lb 17 Years +US$1 billion1 1. Calculated using US$15,000 / ton capacity multiplied by capacity
Slide 7: Gibraltar Copper Mine – Large-Scale, Steady-State Mine
Gibraltar Copper Mine – Large-Scale, Steady-State Mine Value Creation Acquired Gibraltar in 1999 for $1 Restarted the mine in 2004 Between 2006 and 2013, invested C$800 million to expand and modernize the mine to 85,000 tons per day In 2010, sold 25% of the mine for C$187 million to a Japanese conso
Slide 8: Gibraltar Copper Mine
Gibraltar Copper Mine One of the Americas most efficient open pit copper mines On a cost per tonne milled basis, Gibraltar Lowest Cost Open Pit Copper Mines in the Americas (US$/t milled) is one of the lowest cost operations in the Chapada $5.8/t world. This is achieved by: Constancia $7.4/t Gibralt
Slide 9: Resilient Through Copper Price Downturns
Resilient Through Copper Price Downturns Positive operating cash flow generation through the cycle demonstrates Taseko’s operational flexibility and ability to adapt $200 $4.50 Taseko has been able to maintain positive operating cash flow throughout extended periods of weak copper prices through $16
Slide 10: Pathway to a Low-Cost Future
Florence Copper Project - Arizona PATHWAY TO A LOW-COST FUTURE MINE TYPE STAGE PROCESSING In-situ Leach Development SX/EW PRODUCTION (per year) ESTIMATED CASH COSTS MINE LIFE 85Mlb (~40kt) Cu US$1.10/lb LOM 21 Years 10
Slide 11: Florence Copper Project – A Near Term, Low Cost Copper Project
Florence Copper Project – A Near Term, Low Cost Copper Project Project Highlights Over US$135 million was spent on the project by former owners (Conoco, Magma Copper, BHP Copper) Taseko has invested a further $140M since 2014, including US$25M to build the PTF All major power, transportation, road a
Slide 12: In-Situ Copper Recovery (ISCR)
In-Situ Copper Recovery (“ISCR”) How does in-situ copper recovery work? STEP Injection and recovery wells are drilled deep into the bedrock where the oxide 1 copper ore is situated STEP Wells are concrete encased and sealed above the oxide zone to 2 protect water quality STEP Raffinate (99.5% water,
Slide 13: Environmental Advantages of In-Situ Copper Recovery
Environmental Advantages of In-Situ Copper Recovery ISCR – a green production method for the green metal of the future Illustrative Environmental Advantages of Florence ISCR Project1 Small Environmental Footprint Conventional Open Pit Mine Florence ISCR 41 Lower Energy Requirement Than Conventional
Slide 14: Florence Copper Project – A Defined Path to Production
Florence Copper Project – A Defined Path to Production 2017 2018 2019 2020 2021 2023 Technical work results in PTF development First cathode produced Completed PTF Project financing – First production from significant improvement in and construction starts in April 2019 production phase US$400mm deb
Slide 15: Florence Copper Project – Construction Schedule
Florence Copper Project – Construction Schedule Schedule of Key Components of Construction Simplified construction schedule following issuance of final UIC permit Engineering Procurement Final UIC Permit Preproduction Well Development SX/EW Construction Wellfield Infrastructure Leaching Operations O
Slide 16: Florence Copper Project – Overall Site Area Plan
Florence Copper Project – Overall Site Area Plan Power Substation PRIMARY ACCESS ENTRANCE & Distribution Existing PTF Pond Existing Admin, Plant Area Initial Warehouse and Wellfield Existing PTF Maintenance WELLFIELD PIPELINE CORRIDOR PTF Wellfield STATE LEASE BOUNDARY Evaporation Wellfield Future P
Slide 17: Florence Copper Project – Capital Efficient, High Return Growth Project
Florence Copper Project – Capital Efficient, High Return Growth Project Value Creation Cu Price Pre-Tax NPV Pre-Tax Sensitivity (US$/lb) (US$M) IRR Model $3.00 $915 45% +17% $3.50 $1,260 55% In 2014, Taseko acquired Florence Copper for C$80M and invested US$80M in the project to date, including US$2
Slide 18: Looking to the Future
TASEKO MINES LOOKING TO THE FUTURE 18
Slide 19: Yellowhead Copper Project
Yellowhead Copper Project Project Highlights Advanced stage project acquired by Taseko in 2019 for ~C$13 million in Taseko shares Located in close proximity to power, rail and highway In January 2020, Taseko announced improved economics and new 820M tonne Reserve estimate Technical Study Highlights
Slide 20: New Prosperity Gold-Copper Project
New Prosperity Gold-Copper Project Project Highlights One of the Largest Copper-Gold porphyries in the world Life of mine average annual production of ~540,000 gold equivalent oz Provincial Authorization (Environment Assessment Certificate) in place 5-year production profile Gold (ounces) Copper (M
Slide 21: Taseko Copper Reserves
Taseko Copper Reserves Significant Value in P&P Copper Reserves Nearly 15 billion pounds of copper in reserves, more than any of Taseko’s peers Including gold in reserves, over 19 billion pounds of copper equivalent 16 20 14 New Prosperity 12 15 (Lbs / Market Capitalization) (Billions lbs Copper) 10
Slide 22: Why Invest in Taseko – The Valuation Case
Why Invest in Taseko – The Valuation Case $1,800 Taseko Valuation Waterfall Significant gap between asset NPV and market cap $1,600 $850 ❖ Based on US$3.00/lb copper and not including $1,400 $1,315 $1,200 $280 Yellowhead, New Prosperity or Aley $1,000 ~C$500mm Gap $800 $745 Near-term and medium-term
Slide 23: Appendix
23 Taseko) APPENDIX
Slide 24: Capital Structure & Coverage
Capital Structure & Coverage Share Price US$2.10 / C$2.70 Analyst Coverage Target Price & Recommendation 52 Week High / Low US$2.67 / C$0.94 Buy C$3.25 (+20%) Nov ’21 Buy C$3.25 (+20%) Nov ’21 Listed TSX:TKO / NYSE:TGB / LSE:TKO Buy C$3.25 (+20%) Nov ’21 Shares Outstanding* 284M Hold C$3.25 (+20%) N
Slide 25: Improved Credit Profile
Improved Credit Profile Substantial improvement in leverage metrics on the back of higher copper prices, Gibraltar mine plan optimization and enhanced liquidity Operational Improvement Taseko maintains reasonable leverage levels and balances LTM Adjusted EBITDA capital needs through a combination of
Slide 26: Proactively Reducing Impact of Cu Price Volatility
Proactively Reducing Impact of Cu Price Volatility Hedging policy in place to reduce the short term Historical Copper Hedging impact of a decline in the price of copper and Cu Production (Mlbs) Defensive Hedging Strategy Taseko’s hedging strategy is designed to secure a minimum price for a significa
Slide 27: Building a Sustainable Business
Building a Sustainable Business Environment Employees Comprehensive Environmental Policy Energy Management Team Health & Safety Policy Long-term Water Management Plan Commitment to best management Commitment to diversified workforce Responsible Tailings Management practice as outlined under MABC Hig
Slide 28: A Proven Team of Mine Builders and Value Creators
A Proven Team of Mine Builders and Value Creators Senior Management Experienced Operating Team STUART MCDONALD, CPA BRYCE HAMMING, CFA, CPA RICHARD TREMBLAY, P.Eng ROB ROTZINGER, P.Eng President & CEO CFO Senior Vice President, Operations Vice President, Capital Projects Mining executive with 25 yea
Slide 29: Aley Niobium Project
Aley Niobium Project Project Highlights The world's largest niobium deposit, outside the two operating mines in Brazil (site covers ~433 km2) “Green" rare metal – metals like niobium, are the heart of green technology, such as wind turbines and electric vehicles Taseko acquired the project in 2007 f
Slide 30: Jurisdiction Exposure – 2019 Fraser Institute
Jurisdiction Exposure – 2019 Fraser Institute Taseko’s exposure sits on the 1st quartile of the Fraser Institute’s Investment Attractiveness Index The Investment Attractiveness Index is a composite index that combines the Policy Perception Index and the Best Practices Mineral Potential Index, weight
Slide 31: Appendix – Reserves & Resources (Gibraltar, Florence)
Appendix – Reserves & Resources Gibraltar Florence Recoverable Contained Recoverable Contained Category Grade Category Size Grade Size Metal1 Metal Metal Metal (at 0.15% Cu cut-off) (M Tons) (at 0.05% TCu cut-off) (M Tons) Cu (%) Mo (%) Cu (B lbs) Cu (B lbs) (%TCu) Cu (B lbs) Cu (B lbs) Proven 442 0
Slide 32: Appendix – Reserves & Resources (Yellowhead, Aley)
Appendix – Reserves & Resources Yellowhead Aley Recoverable Contained Recoverable Contained Category Grade Grade Size Copper Copper Size Metal Metal Category (at 0.17% Cu cut-off) (M Tons) (M Tonnes) Cu (%) Au (g/t) Ag (g/t) Cu Eq (%)* (B lbs) (B lbs) Nb205 (%) Nb (M kg) Nb (M kg) Proven 458 0.29 0.
Slide 33: Appendix – Reserves & Resources (New Prosperity)
Appendix – Reserves & Resources New Prosperity Grade Recoverable Metal Contained Metal Size Category (M Tonnes) Au Cu Au Cu Au (g/t) Cu (%) (M oz) (B lb) (M oz) (B lb) Proven 481 0.46 0.26 5.0 2.4 7.1 2.8 Probable 350 0.35 0.18 2.7 1.2 3.9 1.4 Total P&P Reserves 831 0.41 0.23 7.7 3.6 11.0 4.2 (at C$
Slide 34: Appendix – NI 43-101 Compliance
Appendix – 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 re
Slide 35: Tasekomines.com
Taseko) Tasekomines.com f # © &