Antofagasta Plc · LSE:ANTO
Antofagasta — Investor Presentation (September 2014)
19 slides from Antofagasta's investor presentation, September 2014
Slide 1: Investor Presentation September 2014
Investor Presentation September 2014
Slide 2: Cautionary Statement
Cautionary Statement This presentation has been prepared by Antofagasta plc. By reviewing and/or attending this presentation you agree to the following conditions. This presentation contains forward-looking statements. All statements other than historical facts are forward-looking statements. Exampl
Slide 3: Agenda
Agenda Overview Operations and costs Growth opportunities Investment case 3
Slide 4: Investment overview
Investment overview High • Competitive cash costs quality • Strong production, large resource base and long life assets assets • Focus on two ‘world class’ mining districts Cost • Focus on operating and project cost control control • Strong operating margins and capital efficiency Capital • Return o
Slide 5: Market environment and outlook
Market environment and outlook • LME copper price averaged $3.14/lb in the first • New mine production ramping up half of 2014 (2013 H1: $3.42/lb) • Forecast surplus for 2014 reduced from • Some concerns over China’s growth 500-900kt to 100-150kt • Prices supported by tight scrap market • Current br
Slide 6: Operations and costs
Operations and costs Los Pelambres
Slide 7: Operations summary - FY14 guidance
Operations summary - FY14 guidance Centinela (previously Esperanza and El Tesoro) BOLIVIA Concentrates Cathodes Copper production (kt) 170 95 Gold production (koz) 215 - Antofagasta Net Cash cost ($/lb) 1.45 1.70 CHILE HY 2014 EBITDA Margin (%) 39.9 42.3 Mine Life (yrs) 46 10 Los Pelambres Copper pr
Slide 8: Centinela merger
Centinela merger • Merger of Esperanza and El Tesoro • Value creation through operational synergies: o sharing of operational overheads • Will develop some 7 billion tonnes of o combined management team resources o integration of the mine plans o sharing of mining properties and facilities • Merger
Slide 9: Power costs in Chile
Power costs in Chile • Two separate power grids in Chile – Northern (SING) and Central (SIC) • Northern Grid: predominantly coal fired stations and stable pricing • Southern Grid: hydro, coal, LNG and diesel stations. Volatile pricing, weather dependent • Los Pelambres on Central Grid, paying spot p
Slide 10: Current energy contracts for Los Pelambres
Current energy contracts for Los Pelambres MW 200 ALTO MAIPO (Hydro) PACIFIC HYDRO: Spot 110 MW 112 SunEdison (Solar) 22 MW AES GENER (Coal) 50 MW 40 El Arrayán (Wind) : 40 MW 2014 2015 2016 2017 2018 2019 2020 2021 2022 2022 Anticipate Problem Execute Partial Solution Execute Long-Term Solution Opt
Slide 11: Growth opportunities
Growth opportunities Centinela
Slide 12: 2014 priorities – delivering on the strategy
2014 priorities – delivering on the strategy Existing core business o Constant focus on cost management o Delivery of production and cash cost guidance o Continue to get the best possible performance from existing assets Organic & sustainable growth of the core business o Progress Antucoya on budget
Slide 13: Growth pipeline
Growth pipeline In periods of lower prices and increasing capital intensity: • Focus remains on cost control and efficiency throughout the operations • Focus on higher return, lower risk brownfield debottlenecking/ expansion projects • Advance greenfield projects steadily for future development Gree
Slide 14: Antucoya - on budget, on time
Antucoya - on budget, on time Delivering growth Current status • 85,000 tonnes per annum of production • 86% overall project progress (design, procurement, • Commence production first half 2015 construction) and 74% construction progress(1) • First full year of production 2016 • Long-term power agre
Slide 15: Focus on brownfield expansions
Focus on brownfield expansions Centinela concentrates • Debottlenecking project to reach 105ktpd throughput from 97ktpd • Project completion in 2015 • Moly plant feasibility study due end of 2014 Encuentro Oxides • Encuentro Oxides will ensure maximum utilisation of existing Centinela cathodes’ SX-E
Slide 16: Production growth
Production growth Group Production Profile (‘000s tonnes) 1,000 900 800 700 600 500 400 2013FY 2014E 2015E 2016E 2017E 2018E Base Case (Incl. Esperanza 105ktpd) Base Case (Incl. Centinela Conc. Antucoya Encuentro Oxides Los Pelambres Expansion 105ktpd) • Antucoya and brownfield expansions provide me
Slide 17: Growth opportunities beyond 2018
Growth opportunities beyond 2018 Los Pelambres – long term further Twin Metals, Minnesota expansion • 2.3 billion tonne resource containing copper, • A world class deposit nickel and PGMs • Current resource base triple the size of the • Prefeasibility study completed current 23 year mine plan • Dulu
Slide 18: Investment case
ANTOFAGASTA On PLE - Investment case.
Slide 19: Investment case
Investment case High • Competitive cash costs quality • Strong production, large resource base and long life assets assets • Focus on two ‘world class’ mining districts Cost • Focus on operating and project cost control control • Strong operating margins and capital efficiency Capital • Return of ca