Slide 1: The New Leader in Global Copper
The New Leader in Global Copper August, 2013
Slide 2: Cautionary Note Regarding Forward-Looking Statement
Cautionary Note Regarding Forward-Looking Statement 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 a
Slide 3: Strong Q2 2013 Results
Strong Q2 2013 Results • Copper production 44% higher to 103,694 tonnes • Nickel production up 33% to 10,875 tonnes • Gold production 44% higher to 63,567 ounces • Copper production cash costs lower by 12% to $1.34 per pound • Comparative net earnings of $106.1 million or $0.18 per share • inclusive
Slide 4: A Significant Step Forward in Our Growth & Diversification Strategy
A Significant Step Forward in Our Growth & Diversification Strategy Australia 10% Australia 19% Europe 8% Africa 36% Europe 10% Americas Africa Americas 45% 71% 92% Europe 9% 1 Mtpa1 300 Ktpa1 1.3 Mtpa 1 2018E Copper production. Source: BrookHunt 4
Slide 5: Geographically Diversified Portfolio of High-Quality Operations & Projects
Geographically Diversified Portfolio of High-Quality Operations & Projects 5
Slide 6: High-Quality, Stable Operations
High-Quality, Stable Operations 6
Slide 7: Kansanshi Cu-Au mine, Zambia
High-Quality, Stable Operations Kansanshi Cu-Au mine, Zambia • Located near Solwezi in the north western Province of Zambia • First production in 2005 • Open pit mining • Flexible ore treatment to allow for variation in ore type : – sulphide circuit; oxide circuit; gold facility • Near mine resource
Slide 8: Kansanshi Multi-phase Production Expansion
High-Quality, Stable Operations Kansanshi Cu-Au mine, Zambia Multi-phase production expansion project underway Expansion Estimate Production – 2012 – 2015 Project Capacity Completion Cost Impact 60% increase in overall (US$M) production capacity Oxide 7.2 mtpa Complete 31 Copper: 10,000 - 15,000 tpa
Slide 9: Guelb Moghrein Cu-Au mine, Mauritania
High-Quality, Stable Operations Guelb Moghrein Cu-Au mine, Mauritania • 100% ownership • Located 250 kilometres northeast of the nation’s capital, Nouakchott • As at December 31, 2012, the estimated minelife was ~nine years (including stockpiles) based on current operations • First production in 200
Slide 10: Guelb Moghrein Cu-Au mine, Mauritania
High-Quality, Stable Operations Guelb Moghrein Cu-Au mine, Mauritania • Stronger, more sustained performance over the past 12 months • Focused on improving plant availability • Evaluating potential to recover magnetite as a by-product • Deposit considered to be an IOCG type deposit - structure and m
Slide 11: Ravensthorpe Ni mine, Australia
High-Quality, Stable Operations Ravensthorpe Ni mine, Australia • Acquired as a decommissioned plant in 2010 • First production within 20 months of purchase • Estimated mine life of 32 years • Commercial production declared Dec 28 2011 • Workforce = ~405 • Q2 ‘13 performance – 8,919 tonnes of contai
Slide 12: Kevitsa Ni-Cu-PGE mine, Finland
High-Quality, Stable Operations Kevitsa Ni-Cu-PGE mine, Finland • Built, commissioned and started commercial operations within 36 months of board approval • Estimated mine life of 29 years • Commercial production declared August 2012 • Workforce = ~290 • Further potential – Process optimization – Ap
Slide 13: Las Cruces Cu mine, Spain
High-Quality, Stable Operations Las Cruces Cu mine, Spain • Acquired in March 2013 • Estimated mine life of 9 years with potential for an additional 10 to 15 years • Average grade of 5.4% copper • Workforce = 250 direct employees; 650 contractors • Annual production capacity – 72,000 tonnes of coppe
Slide 14: Çayeli Cu-Zn mine, Turkey
High-Quality, Stable Operations Çayeli Cu-Zn mine, Turkey • Acquired in March 2013 • Estimated mine life of 6 years with potential for an additional 3 years • Average grade of 3.1% copper and 3.6% zinc • Workforce = 493 employees • Q2 2013 C1 cash cost of US$0.11/lb. copper • 2013 Estimates: – 28,00
Slide 15: Pyhäsalmi Cu-Zn mine, Finland
High-Quality, Stable Operations Pyhäsalmi Cu-Zn mine, Finland • Acquired in March 2013 • One of the most efficient underground mines in the world • Estimated mine life of 6 years • Average grade of 1.1% copper and 1.9% zinc • Workforce = 261 employees • Q2 C1 cash cost of US$0.30/lb. copper • 2013 E
Slide 16: Outlook for 2013
Outlook for 2013 Production Copper Nickel Gold Zinc (000’s tonnes) (000’s contained tonnes) (000’s ounces) (000’s tonnes) Group 384 - 416 40 - 45 193 - 213 41 - 48 Kansanshi 250 - 270 - 126 - 140 - Guelb Moghrein 37 - 41 - 56 - 61 - Ravensthorpe - 31 - 35 - - Kevitsa 15 - 16 9 - 10 11 - 12 - Çayeli1
Slide 17: Our Project Pipeline
Our Project Pipeline Development Projects & FIRST QUANTUM
Slide 18: Copper Smelter, Zambia
Our Project Pipeline Copper Smelter, Zambia • Processing capacity of 1.2 Mtpa —71% Sentinel —100% Kansanshi —Average copper grade 26% • Copper production 300,000 tpa; acid production 1.0 Mtpa • Estimates: − Capital cost of US$650M − Operating cost US$69/tonne of concentrate − Commissioning from mid
Slide 19: Sentinel Cu project, Zambia
Our Project Pipeline Sentinel Cu project, Zambia • Located ~ 140 km northwest of Solwezi, northern Zambia • M&I resource of 1,027 Mt at 0.51% Cu grade, containing 5.2 Mt Cu • Estimates: – 2.2:1 LOM strip ratio – >15 years mine life – US$2.0 billion capex – Annual production up to 300,000 tonnes 19
Slide 20: Cobre Panama Cu project, Panama
Our Project Pipeline Cobre Panama Cu project, Panama • Acquired March 2013 • Large open pit copper project • Larger project than the Panama Canal • Major aspect in our acquisition decision • Est. mine life of 40 years • Est. average annual production of 260,000 tonnes copper • Speeding up access to
Slide 21: Haquira Cu project, Peru
Our Project Pipeline Haquira Cu project, Peru • Focused on community & environmental aspects • Potential: - 20 year mine life – Avg 190k tonnes of copper production per year 21
Slide 22: One of the Few Mining Companies Investing in Building Capacity
One of the Few Mining Companies Investing in Building Capacity
Slide 23: Metals & Mining Capital Expenditure Has Peaked
Metals & Mining Capital Expenditure Has Peaked (US$ MM) 90,000 Capital Expenditure by Major Mining Companies 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 -- 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E Source: Company information, CapIQ Note: Includes
Slide 24: Junior Miners Struggling to Access Capital
Junior Miners Struggling to Access Capital Troubled Financing Landscape Has Created a Funding Gap for Junior Mining Companies IPO Proceeds Volume (US$ Bn) (Deals) 40-50% reductions in new issues and follow-on 25 proceeds providing little support for Juniors from the 300 equity markets 250 20 200 15
Slide 25: Focus on Capital Structure, Not Capital Spending
Focus on Capital Structure, Not Capital Spending Two-tier market: Bond Proceeds (US$ Bn) Volume (Deals) the largest 120 200 borrowing large; 100 160 Proceeds Volume the rest 80 120 borrowing little 60 or not at all 40 80 20 40 Over 50% of -- -- 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2
Slide 26: First Quantum: Success Through Project Development
First Quantum: Success Through Project Development We spend a 70% Capital Expenditure as a Percentage of Revenue (2005-2013) disproportionally high 60% amount on growth First Quantum Copper Peers Majors 50% projects 40% 30% This approach has 20% been a key driver behind our success as 10% a comp
Slide 27: Total Annualized Shareholder Return
Total Annualized Shareholder Return January 2000 – March 2013 First Quantum 33% Southern Copper 27% Antofagasta 23% Vale 22% BHP Billiton 16% Vedanta 15% Lundin 13% Teck 12% Freeport 11% Rio Tinto 9% HudBay 7% Anglo American 5% Eramet SA 5% Norilsk 3% Kazakhmys (5%) ENRC (15%) Glencore (21%) Source:
Slide 28: Leading Copper Growth
Freeport-McMoRan 1.8 Glencore Xstrata 1.5 Codelco 1.5 First Quantum 1.3 BHP Billiton 1.2 Leading Copper Growth Southern Copper 0.9 Rio Tinto 0.8 Anglo American 0.8 KGHM 0.6 Source: BrookHunt Kazakhmys 0.5 2018E Copper Production, Mt Teck Resources 0.5 Vale 0.5 Antofagasta 0.4 Norilsk 0.4 First Quant
Slide 29: The New Global Copper Leader
The New Global Copper Leader The New Go-To Copper Producer Attractive Diverse Geographic Exposure A Long-Standing Commitment to Social and Environmental Excellence Creating Value with Our Project Development Expertise An Exciting Future Ahead 29
Slide 30: The New Leader in Global Copper
The New Leader in Global Copper August, 2013