Coeur Mining, Inc. · NYSE:CDE
Coeur Mining — Technical Presentation (July 2019)
55 slides from Coeur Mining's technical presentation, Jul 17, 2019
Slide 1: Silvertip Site Tour
Silvertip Site Tour July 17, 2019 NYSE: CDE NYSE: CDE 1 JC 2016
Slide 2: Cautionary Statements
Cautionary Statements This presentation contains forward‐looking statements within the meaning of securities legislation in the United States and Canada, including statements regarding the Silvertip mine, including operations, exploration and development activities, permitting matters, expected fina
Slide 3: Agenda
Agenda Time Event 7:00 a.m. 8:45 a.m. Flight: Vancouver to Watson Lake 8:45 a.m. 10:30 a.m. Drive: Watson Lake to Silvertip 10:30 a.m. 11:45 a.m. Safety briefing and site orientation Lunch 11:45 a.m. 12:30 p.m. General discussion and Q&A Safety gear-up 12:30 p.m. 2:00 p.m. Core shack Mine tour Safet
Slide 4: Management Participants
Management Participants Corporate Team Mitchell Krebs – President and Chief Executive Officer Thomas Whelan – Senior Vice President and Chief Financial Officer Terry Smith – Senior Vice President, Operations Hans Rasmussen – Senior Vice President, Exploration Alim Visram – Vice President, Corporate
Slide 5: Who We Are
Who We Are Based in the U.S., Coeur Mining (NYSE: CDE) is a significant producer of gold and silver, and has repositioned its portfolio with a focus on sustainable, high- quality growth and cash flow from a North American asset base Key Highlights 5 operating mines 3 top jurisdictions K ENSINGTON S
Slide 6: Why Invest in Coeur?
Why Invest in Coeur? 90 year-old, U.S.-based, NYSE-listed precious metals company seeking to differentiate itself though a unique mix of size, growth and quality By Asset Balanced, Safe and Unique By Jurisdiction Asset Base By Metal Asset Optimizations Repositioned Portfolio Opportunistic M&A & Dive
Slide 7: Silvertip Summary Highlights
Silvertip Summary Highlights ✓• Large, prospective land position containing one of the world’s highest-grade silver-zinc- lead deposits ✓• Opportunity to cost-efficiently expand reserves and resources over time ✓• Reasons for slower than anticipated ramp-up being addressed ✓• Strong, experienced man
Slide 8: Geographic Location of Silvertip
Geographic Location of Silvertip Located in British Columbia, just below the Yukon border, Silvertip sits within a highly prospective 93,000-acre land package. The operation is accessible via a 25 kilometer mine access road off the Alaska Highway, which connects Whitehorse and Watson Lake Regional M
Slide 9: Silvertip Background and History
Silvertip Background and History Silvertip is one of the industry’s newest and highest grade silver-zinc-lead mines. The underground operation produces both zinc and lead concentrates that are sold to third-party smelters Project Timeline 1955 – 1960 1960 – 2013 2013 – 2017 Oct 2017 – Present Outcro
Slide 10: Silvertip Workforce Snapshot
Silvertip Workforce Snapshot Coeur aims to be the employer of choice and develop a robust pipeline of future leaders from the surrounding communities Overview • 293 employees as of June 14, 2019 • 21% of employees identify as First Nations • 8 leadership transfers from other Coeur operations • 15 co
Slide 11: Commitment to Environmental, Social & Governance Practices
Commitment to Environmental, Social & Governance Practices Coeur’s purpose statement, We Pursue a Higher Standard, is underscored by the Company’s dedication to protect its people, places and planet. Initiatives taken at Silvertip demonstrate the Company’s commitment to these principles People Place
Slide 12: Newly Commissioned Camp Facility
Newly Commissioned Camp Facility As part of Coeur’s continued investment in its people, the Company opened a new 220-person camp facility at Silvertip in 2Q 2019 NYSE: CDE 12 JC 2016
Slide 13: Strong Commitment to Safety Reflected in Performance
Strong Commitment to Safety Reflected in Performance Silvertip’s injury frequency rate has improved significantly since Coeur implemented its health and safety standards Overview of Safety Culture Lost-Time Injury Frequency Rate 0.6 • ✓ Foster and enhance strong safety culture and values 0.5 0.4 • ✓
Slide 14: Challenges, Accomplishments & Key Priorities
Challenges, Accomplishments & Key Priorities Although the ramp-up of Silvertip has been slower than originally anticipated, Coeur has made significant progress in positioning the operation for success. Key initiatives that are currently underway are expected to further enhance both operational and f
Slide 15: Key Areas of Downtime and Key Projects Being Addressed
Key Areas of Downtime and Key Projects Being Addressed Highlighted below are the key sources of mill downtime and the necessary steps to address each item. As these projects are completed, Coeur anticipates more consistent mill performance, higher grades and recoveries as well as higher-quality conc
Slide 16: Silvertip Leadership Profiles
Silvertip Leadership Profiles James Clark Tim Fisch Vice President, Co-General Manager Co-General Manager • Joined Coeur in 2017 • Joined Coeur in 2019 • Prior to joining Coeur, worked with De Beers Group • Prior to joining Coeur, worked with Imperial Metals of Companies Corporation – Managerial rol
Slide 17: First Nations Overview
First Nations Overview Silvertip is in an area where the Kaska and the Tahltan First Nations have overlapping claims. Coeur is committed to maintaining respectful and collaborative relationships and will continue to work to ensure that their communities and members support and share in the benefits
Slide 18: Regulatory Environment and Permitting
Regulatory Environment and Permitting Coeur anticipates receiving permit amendments during 3Q 2019 to allow for continued production at Silvertip; otherwise, Silvertip is suitably permitted to support its current operations • Permits issued under the Mines Act and the Environmental Management Act (“
Slide 19: Silvertip Investment Thesis
Silvertip Investment Thesis Coeur acquired Silvertip in October 2017 as part of its long-term strategy of discovering, developing and operating a balanced portfolio of high-quality North American precious metals assets Investment Rationale Reserve Benchmarking 1 Lower Silver Higher Silver • ✓ Highly
Slide 20: Overview of Silvertip Geologic Model
Overview of Silvertip Geologic Model Silvertip ore fluid, driven by a felsic intrusive source, was deposited as mantos at or near the contact between the McDame and Earn groups. These two geology packages outcrop in numerous locations on the claim block. Ore fluid feeder structures are also the targ
Slide 21: Near-Mine Priority Targets at Silvertip
Near-Mine Priority Targets at Silvertip Employing an integrated exploration program, five near-mine targets have been prioritized for future drilling Regional Targets on Geophysical Data Near-Term “Silvertip-Style” Targets • Identified through a combination of geology, geochemistry and geophysics in
Slide 22: Plan View With All Significant Intercepts (1H 2018)
Plan View With All Significant Intercepts (1H 2018) Note: For complete tables of all drill results, please refer to the following links: https://www.coeur.com/_resources/pdfs/180725_SILVERTIP_Exploration_PR_Appendix_v2.pdf; NYSE: CDE 22 https://www.coeur.com/_resources/pdfs/181212_COEUR_Exploration_
Slide 23: 2018 Central Zone Drilling Highlights
2018 Central Zone Drilling Highlights Surface Drilling Summary • Central Zone was main focus of the 2018 surface infill drilling campaign • Preliminary modeling portrayed the zone as discontinuous, discrete pods as a result of limited drilling data from prior exploration • 2018 drilling confirmed th
Slide 24: 2018 Discovery Zone Drilling Highlights
2018 Discovery Zone Drilling Highlights Surface Drilling Summary • Thick zones (≥ 30 meter) of mineralization, previously unrecognized, were intercepted at Discovery Zone in early-2018 • This area has demonstrated potential for multiple stacked horizons of manto mineralization at and below the Earn
Slide 25: 2018 Silver Creek Zone Feeder Structures and Manto
2018 Silver Creek Zone Feeder Structures and Manto • 2018 Underground Drilling focused on delineating/expanding vertical feeders within Silver Creek, and manto horizon at Central Zone • Several holes crossed the mineralized Camp Creek Fault and sub-parallel mineralized feeder structures at Silver Cr
Slide 26: 2019 Drilling Expected to Grow and Convert Resources
2019 Drilling Expected to Grow and Convert Resources Selected Commentary • 2018 drilling at Silvertip focused on infill and resource conversion • Primary focus of 2019 drilling program is resource growth and expansion • Top priority areas for 2019 resource expansion drilling include Discovery East a
Slide 27: Plan View of Expanded Resource (2019)
Plan View of Expanded Resource (2019) Note: Please refer to the appendix of this presentation for a complete table of all 2019 drill results. NYSE: CDE 27 JC 2016
Slide 28: Current Progress of 2019 Drilling
Current Progress of 2019 Drilling • Three surface rigs currently drilling expansion DSC19-Pad1 holes at Discovery East • 13 of 15 resource expansion holes drilled at Discovery East have successfully intercepted manto mineralization • Stacked manto horizons have been intercepted in early-2019 drillin
Slide 29: Favorable Horizon Largely Unexplored
Favorable Horizon Largely Unexplored • Over 20 kilometer of Earn-McDame contact within Coeur Silvertip claims • Predominately unexplored • Main focus for near-term regional exploration programs Silvertip Mine • Potential for discovering another “Silvertip-style” Tour Ridge deposit along this trend T
Slide 30: 2019 Regional Exploration Program: Making New Discoveries
2019 Regional Exploration Program: Making New Discoveries Exploration within the Silvertip Exploration Concessions has been limited to less than ~5% of the overall area • Goal of 2019 Regional Exploration Program is making a “New Discovery” Silvertip Mine – Tiger Terrace: Top “Near-Silvertip” Target
Slide 31: Silvertip Mine Design and Mining Method
Silvertip Mine Design and Mining Method The life-of-mine plan at Silvertip consists of approximately 75% cut-and-fill and 25% longhole stoping Mine Design Typical Cut-And-Fill Layout Typical Longhole Stoping Layout Longhole Stopes Cut- And-Fill NYSE: CDE 31 JC 2016
Slide 32: Silvertip Mill Building
Silvertip Mill Building NYSE: CDE 32 JC 2016
Slide 33: Simplified Silvertip Mill Process Flowsheet
Simplified Silvertip Mill Process Flowsheet 1 Mineral processing includes: (i) crushing, (ii) grinding, (iii) flotation, and (iv) dewatering circuits Note: Lead regrind mill not currently part of mill configuration and additional flotation capacity would need to be added to accommodate 1,250 mtpd. N
Slide 34: Review of Silvertip Operational Performance
Review of Silvertip Operational Performance 1 Despite the slower than anticipated ramp-up, operations at Silvertip have been improving with 2Q 2019 representing the best period of operational performance since acquisition Tonnes Milled Average Grade 56,292 8.2% Double digit 54,149 8.0% improvement i
Slide 35: Overview of Silvertip Technical Report
Overview of Silvertip Technical Report Highlighted below are key assumptions and summary operational data from Silvertip’s technical report1 Key Assumptions2 Annual Throughput (000s tonnes) M et al P ri c e As s u mpt i on s Silver $/oz $17.00 172 Zinc $/lb $1.25 Lead $/lb $1.00 352 Average M et all
Slide 36: Overview of Silvertip Technical Report (cont.)
Overview of Silvertip Technical Report (cont.) Highlighted below is the high-level financial information from Silvertip’s technical report, which utilizes the assumptions outlined on the previous page1 Net Revenue2 Operating Cost Breakdown ($M) ($/tonne milled) $141 $142 $137 $197 $173 70 $138 72 65
Slide 37: Silvertip Reserve and Resource Summary
Silvertip Reserve and Resource Summary Grade Contained Metal Tons Ag (oz/ton) Zn (%) Pb (%) Ag (oz) Zn (lbs) Pb (lbs) Proven 280,000 10.81 9.83% 7.53% 3,026,000 55,039,000 42,156,000 Probable 1,489,000 7.98 7.93% 5.22% 11,885,000 236,200,000 155,305,000 Proven + Probable 1,769,000 8.43 8.23% 5.58% 1
Slide 38: Silvertip Concentrate Quality and Marketing
Silvertip Concentrate Quality and Marketing Coeur has exclusive offtake agreements with Ocean Partners, pursuant to which it has agreed to sell all zinc and lead concentrate produced at Silvertip Concentrate Quality Standard Payable Elements Typical Deleterious Elements Zinc Lead, iron, silica, cadm
Slide 39: Treatment and Refining Charge Landscape
Treatment and Refining Charge Landscape Overview of Concentrate Benchmark Terms 2019 Benchmarks1 Zinc Concentrate Lead Concentrate Treatment • $245.00 • $98.00 Charge ($/dmt) Silver Refining • N/A • $0.60 Charge ($/oz)2 • $0.05 per dmt for each $1.00 exceeding $3,0003 • N/A Escalators/ • $0.00 per d
Slide 40: Silvertip Transportation and Logistics
Silvertip Transportation and Logistics The transportation process at Silvertip is operating efficiently and effectively. Costs associated with transportation are critical to manage and have potential to be further optimized as Silvertip achieves steady state production Overview of Transportation and
Slide 41: Transitioning From Stabilization to Optimization
Transitioning From Stabilization to Optimization Optimization opportunities designed to improve key metrics and lead to lower costs as well as improved productivity: • Mining and process rate – Impact of 1,250 mtpd vs. 1,000 mtpd • Improving recoveries and concentrate grades • Workforce optimization
Slide 42: Illustrative Silvertip Revenue Stabilization
Illustrative Silvertip Revenue Stabilization Coeur has undertaken various revenue stabilization efforts over the past several quarters to improve Silvertip’s top-line performance. The opportunity to expand the mill to 1,250 mtpd represents a potential opportunity to further expand Silvertip’s revenu
Slide 43: Illustrative Silvertip Cost Optimization
Illustrative Silvertip Cost Optimization With revenue stabilization efforts largely underway, Coeur is shifting its focus to optimizing Silvertip’s cost structure. Optimizing Silvertip’s cost structure is one of the critical elements that will help drive overall profitability at the operation Breako
Slide 44: Appendix
Appendix NYSE: CDE 44 JC 2016
Slide 45: 2019 Guidance
2019 Guidance 1 Production Outlook Gold (oz) Silver (K oz) Zinc (K lbs) Lead (K lbs) Palmarejo 95,000 – 105,000 6,500 – 7,200 - - Rochester 40,000 – 50,000 4,200 – 5,000 - - Kensington 117,000 – 130,000 - - - Wharf 82,000 – 87,000 - - - Silvertip - 1,500 – 2,500 25,000 – 40,000 20,000 – 35,000 Conso
Slide 46: Silvertip Expansion Drilling Intercepts (2019)
Silvertip Expansion Drilling Intercepts (2019) Silvertip Expansion Drilling Intercepts Mineralized Intercept (meters) Assay Results Hole ID From To Length Est. Thick Silver (g/t) Zinc (%) Lead (%) DSC19-Pad1-003 220.3 225.7 5.4 3.8 611.5 18.3 12.0 DSC19-Pad1-005 207.0 213.0 6.0 3.9 339.9 5.9 7.4 DSC
Slide 47: Non-GAAP Reconciliations
Non-GAAP Reconciliations NYSE: CDE 47 JC 2016
Slide 48: Non-GAAP to U.S. GAAP Reconciliation for Guidance
Non-GAAP to U.S. GAAP Reconciliation for Guidance Unaudited Costs Applicable to Sales Guidance for 2019 ($ thousands, except per ounce amounts) Palmarejo Rochester Kensington Wharf Silvertip Total Costs applicable to sales, including amortization (U.S. GAAP) $196,310 $131,918 $154,285 $90,299 $156,4
Slide 49: Reserves and Resources
Reserves and Resources 2018 Proven and Probable Mineral Reserves Grade Contained Location Short tons Gold (oz/t) Silver (oz/t) Zinc (%) Lead (%) Gold (oz) Silver (oz) Zinc (lbs) Lead (lbs) PROVEN RESERVES Palmarejo Mexico 1,283,000 0.084 4.97 108,000 6,376,000 Rochester Nevada, USA 228,413,000 0.003
Slide 50: Reserves and Resources (cont.)
Reserves and Resources (cont.) 2018 Measured and Indicated Mineral Resources (excluding Reserves) Grade Contained Location Short tons Gold (oz/t) Silver (oz/t) Zinc (%) Lead (%) Gold (oz) Silver (oz) Zinc (lbs) Lead (lbs) MEASURED RESOURCES Palmarejo Mexico 604,000 0.086 4.77 52,000 2,880,000 Roches
Slide 51: Reserves and Resources (cont.)
Reserves and Resources (cont.) 2018 Inferred Mineral Resources Grade Contained Location Short tons Gold (oz/t) Silver (oz/t) Zinc (%) Lead (%) Gold (oz) Silver (oz) Zinc (lbs) Lead (lbs) INFERRED RESOURCES Palmarejo Mexico 5,875,000 0.065 4.36 384,000 25,609,000 Rochester Nevada, USA 235,062,000 0.0
Slide 52: Executive Leadership
Executive Leadership Mitchell J. Krebs – President and Chief Executive Officer. During his twenty-year tenure with Coeur, Mr. Krebs has led nearly $2 billion in capital raising and debt restructuring activities and has facilitated over $2 billion of acquisitions and divestitures. Mr. Krebs was previ
Slide 53: Board of Directors
Board of Directors Robert E. Mellor – Former Chairman, Chief Executive Officer, and President of Building Materials Holding Corporation (distribution, manufacturing, and sales of building materials and component products) from 1997 to January 2010, director from 1991 to January 2010; member of the b
Slide 54: Board of Directors (cont.)
Board of Directors (cont.) Jessica L. McDonald – Chair (former Interim CEO) of Canada Post Corporation, Chair of Trevali Mining Corporation and member of Board of Directors of Hydro One Limited. Ms. McDonald is also a Mentor at the Trudeau Foundation, was a visiting fellow at the Steyer-Taylor Cente
Slide 55: Contact Information
Contact Information Corporate Office Coeur Mining, Inc. 104 S. Michigan Ave., Suite 900 Chicago, IL 60603 Main Telephone +1 (312) 489-5800 Stock Ticker CDE: NYSE Website www.coeur.com Contact Paul DePartout Director, Investor Relations investors@coeur.com NYSE: CDE 55 JC 2016