Lundin Mining Corporation · TSX:LUN
Lundin Mining — Investor Presentation (November 2011)
20 slides from Lundin Mining's investor presentation, November 2011
Slide 1: Corporate Update
TSX: LUN OMX: LUMI Corporate Update November, 2011
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward Looking Statements This presentation contains forward-looking statements. These forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events. These forward- looking statements are
Slide 3: Highlights
Highlights Copper: Production improving. New high grade stopes commenced late September. Fourth quarter copper production trending well at Neves-Corvo, as planned. Zinc: Largely in-line. Grinding mill issues resolved early in 4th quarter. Tenke initial overrun debt now fully repaid: First cash
Slide 4: Copper: Change in Production Q3 '11 vs. Q2 '11
Change in Production: Q3 ‘11 vs. Q2 ‘11 Tonnes Copper Excluding Tenke 7,982 attributable share Tonnes Tonnes 45 544 28,791 10,367 487 29,000 10,500 152 1,105 262 10,077 28,500 10,000 Lead 28,000 9,500 Zinc 27,404 27,500 9,000 27,000 8,500 26,500 8,000 Prior Qtr Throughput Grade Recovery Actual Prior
Slide 5: Q3/11 Financial Position
Q3/11 Financial Position • Net cash at Sept. 30, 2011 of $209 million, compared to $126 million at Sept. 30, 2010 and $308 million at June 30, 2011 • Change in net cash during the quarter was impacted by: – $58 million outflow for income tax payments – $19 million outflow for royalty payments – $9.5
Slide 6: Outlook and Operations 2011/2012
Outlook and Operations 2011/2012 6
Slide 7: 2011 Guidance
2011 Guidance (contained tonnes) Revised 2011 Guidance Previous 2011 Guidance Tonnes C1 Cost1 Tonnes C1 Cost1 Neves-Corvo Cu 70,000 $1.80 72,000 $1.65 Zn 4,500 6,000 Zinkgruvan Zn 76,000 $0.32 78,000 $0.21 Pb 34,000 36,000 Cu 1,500 3,400 Galmoy Zn 31,000 28,000 (in ore) Pb 8,000 8,000 Total: Wholly-
Slide 8: Neves-Corvo – Q3/11 Results
Neves-Corvo – Q3/11 Results • Copper prod’n of 15,070 tonnes vs. 13,475 tonnes in Q2/11 • Production from new high grade stopes commenced in late-Sept. Significantly improved production has occurred since then. • C1 Costs of $2.35/lb Cu vs. $2.13/lb in Q2/11 • Announced Lombador Phase 1 Feasibility
Slide 9: Neves-Corvo – Outlook
Neves-Corvo – Outlook • 2012 preliminary prod’n guidance takes into account future proportions of stockworks vs high grade massive sulphide feed • Several internal projects underway to address changing feed characteristics & improve mine planning • Initial Semblana resource to be announced in Q4/11
Slide 10: Neves-Corvo Growth - Lombador & Semblana
Neves-Corvo Growth - Lombador & Semblana Main Ramp Shaft Zambujal Graca Corvo Semblana Neves Lombador 10
Slide 11: Neves-Corvo – Multiple New Targets
Neves-Corvo – Multiple New Targets Semblana and Lombador 3D seismic results 11
Slide 12: Zinkgruvan – Q3/11 Results
Zinkgruvan – Q3/11 Results • Zinc production of 17,459 tonnes vs. 17,582 tonnes in Q2/11 • C1 costs of $0.13/lb Zn vs. $0.26/lb Zn in Q2/11 • New ramp from surface highly successful. Mine continues to outpace mill capacity • New senior personnel appointments made Location • Sweden 2011 Production •
Slide 13: Zinkgruvan - Outlook
Zinkgruvan - Outlook • 2012 Preliminary guidance - largely unchanged from this year • Pursuing several opportunities for incremental improvements • Debottlenecking of materials handling system • Increased investment in underground exploration 13
Slide 14: Aguablanca – Update and Outlook
Aguablanca – Update and Outlook • New mine contractor mobilized in August. Re-instatement of the ramp and pre-stripping progressing well • Restart nickel/copper production in H2/12 with ~€40M investment for restart • Underground study in progress targeting the addition of higher grade material in pa
Slide 15: Tenke – Q3/11 Results
Tenke – Q3/11 Results • Copper production of 32,249 tonnes vs. 29,891 tonnes in Q2/11 • C1 costs of $1.12/lb Cu vs. $0.94/lb Cu in Q2/11 • Equity income of $17 m vs. $32 m in Q2/11 • Negatively impacted by timing of shipments and lower realized prices • Over-run (EOC) facility fully repaid in Q3 – L
Slide 16: Tenke – Outlook
Tenke – Outlook • Phase 2 Feasibility Study completed by FCX: • Expansion to ~195ktpa Cu, w/ completion in 2013 • Project capex of ~ $850 m, of which LUN is responsible for 30% (~$250 m) • Investment on critical path activities in progress since January 2011 • LUN portion of expansion capex expected
Slide 17: Phase 2 Expansion Progress
Phase 2 Expansion Progress Tank House Expansion SX Retaining Wall 17
Slide 18: 2012 Preliminary Production Guidance
2012 Preliminary Production Guidance (contained tonnes of metal in concentrate) Preliminary 2012 Current 2011 Guidance Forecast Tonnes Tonnes Neves-Corvo Cu 52,500 – 57,000 70,000 Zn 30,000 – 40,000 4,500 Zinkgruvan Zn 75,000 – 81,000 76,000 Pb 34,000 – 39,000 34,000 Cu 2,000 – 3,000 1,500 Aguablanc
Slide 19: 2011 Exploration Programs
2011 Exploration Programs Exploration spend will increase to $43 m in 2011 (from $24 m - 2010) • Portugal - Semblana drilling continues to intersect thick sections of resource-grade Cu mineralization. Drilling ramped up on new 3D targets. • Spain – Ossa Morena drilling continues - copper /gold targe
Slide 20: Lundin Mining - Summary
Lundin Mining - Summary • High quality, long life reserves; exploration upside • A stake in Tenke - a unique, world-class copper mine • Strong balance sheet and ongoing cash flows • Fully-funded organic growth profile • High leverage to copper and zinc • Very compelling valuation Neves-Corvo Zinkgru
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