A NEW CAPSTONE FEBRUARY 2020
Cautionary Notes CAUTIONARY NOTE ON FORWARD LOOKING INFORMATION COMPLIANCE WITH NI 43-101 This presentation, and the documents incorporated by reference herein, may contain “forward-looking information” within the Unless otherwise indicated, Capstone has prepared the technical information in this presentation (“Technical Information”) meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private based on information contained in the technical reports and news releases (collectively the “Disclosure Documents”) Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements”). These forward-looking statements are available under Capstone Mining Corp.’s company profile on SEDAR at www.sedar.com. Each Disclosure Document was made as of the date of this document and Capstone Mining Corp. (“Capstone” or the “Company”) does not intend, and does prepared by or under the supervision of a qualified person (a “Qualified Person” or “QP”) as defined in National Instrument not assume any obligation, to update these forward-looking statements, except as required under applicable securities 43-101 – Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators (“NI 43-101”). For readers legislation. Forward-looking statements relate to future events or future performance and reflect our expectations or beliefs to fully understand the information in this presentation, they should read the Technical Reports (available on regarding future events. Forward-looking statements include, but are not limited to, statements with respect to the estimation of www.sedar.com) in their entirety, including all qualifications, assumptions and exclusions that relate to the information set mineral resources and mineral reserves, the realization of mineral reserve estimates, the timing and amount of estimated future out in this presentation which qualifies the Technical Information. Readers are advised that mineral resources that are not production, costs of production and capital expenditures, the success of our mining operations, environmental risks, mineral reserves do not have demonstrated economic viability. The Disclosure Documents are each intended to be read as unanticipated reclamation expenses and title disputes. In certain cases, forward-looking statements can be identified by the a whole, and sections should not be read or relied upon out of context. The Technical Information is subject to the use of words such as “plans”, “expects”, “guidance”, “scheduled”, “estimates”, “forecasts”, "future state", “intends”, “anticipates”, assumptions and qualifications contained in the Disclosure Documents. For further details refer to the Company’s NI 43- “believes” or variations of such words and phrases, or statements that certain actions, events or results “may”, “could”, “would”, 101 Technical Reports as follows: “might” or “will be taken”, “occur” or “be achieved” or the negative of these terms or comparable terminology. In this document • Cozamin Mine, Zacatacas, Mexico published Jan 24, 2019, effective Oct 24, 2018; certain forward-looking statements are identified by words such as “expects”, “approximately”, “could”, “expects”, “target”, • Pinto Valley Mine Life Extension – Phase 3 (PV3) Pre-feasibility Study, Miami, Arizona, published Feb 23, 2016, “targeting”, “guidance”, “potential”, “extended”, “convert”, “will”, “provides” “plan” and “expected”. By their very nature, forward- effective Jan 1, 2016; and looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, • Santo Domingo Project, Region III, Chile, Feasibility Study Update, published Jan 3, 2019, effective Nov 26, 2018, in performance or achievements to be materially different from any future results, performance or achievements expressed or addition see the Company’s news release of February 19, 2020. implied by the forward-looking statements. Such factors include, amongst others, risks related to inherent hazards associated with mining operations and closure of mining projects, future prices of copper and other metals, compliance with financial The Technical Information in this presentation has been prepared in accordance with NI 43-101 and reviewed and covenants, surety bonding, our ability to raise capital, Capstone’s ability to acquire properties for growth, counterparty risks approved by Brad Mercer, P. Geol., Capstone's Senior Vice President, Operations and Exploration, a Qualified Person as associated with sales of our metals, foreign currency exchange rate fluctuations, changes in general economic conditions, defined in NI 43-101. accuracy of mineral resource and mineral reserve estimates, operating in foreign jurisdictions with risk of changes to governmental regulation, compliance with governmental regulations, compliance with environmental laws and regulations, ALTERNATIVE PERFORMANCE MEASURES reliance on approvals, licences and permits from governmental authorities, impact of climatic conditions on our operations, “C1 cash cost”, “cash cost”, “adjusted EBITDA”, “operating cash flow before changes in working capital” and “net debt” are aboriginal title claims and rights to consultation and accommodation, land reclamation and mine closure obligations, Alternative Performance Measures. Alternative performance measures are furnished to provide additional information. uncertainties and risks related to the potential development of the Santo Domingo Project, increased operating and capital These non-GAAP performance measures are included in this presentation because these statistics are key performance costs, challenges to title to our mineral properties, maintaining ongoing social license to operate, dependence on key measures that management uses to monitor performance, to assess how the Company is performing, to plan and to management personnel, potential conflicts of interest involving our directors and officers, corruption and bribery, limitations assess the overall effectiveness and efficiency of mining operations. These performance measures do not have a standard inherent in our insurance coverage, labour relations, increasing energy prices, competition in the mining industry, risks meaning within IFRS and, therefore, amounts presented may not be comparable to similar data presented by other mining associated with joint venture partners, our ability to integrate new acquisitions into our operations, cybersecurity threats, legal companies. These performance measures should not be considered in isolation as a substitute for measures of proceedings, and other risks of the mining industry as well as those factors detailed from time to time in the Company’s interim performance in accordance with IFRS. For full information, please refer to the Company’s latest Management Discussion and annual financial statements and MD&A of those statements, all of which are filed and available for review under the and Analysis published on its Financial Reporting webpage or on SEDAR. Company’s profile on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause our actual results, performance or achievements to differ materially from those described in our forward-looking CURRENCY statements, there may be other factors that cause our results, performance or achievements not to be as anticipated, estimated All amounts are in US$ unless otherwise specified. or intended. There can be no assurance that our forward-looking statements will prove to be accurate, as our actual results, performance or achievements could differ materially from those anticipated in such statements. Accordingly, readers should not FOOTNOTES place undue reliance on our forward-looking statements. Refer to the FOOTNOTES slide for all references throughout this presentation. CAPSTONE MINING (TSX:CS) • 2
Capstone Mining: Prudent Growth and Lower Costs COZAMIN STRATEGY PINTO VALLEY 1 SANTO DOMINGO 2 To build on 20% copper Positioning to be optimized in Low cost mine generating Top quartile, fully-permitted production growth and 10% time for higher copper prices free cash flow at any copper project in Chile; Cu-Fe-Au lower costs by 2021 with a price project with US$1.0 billion multi-asset portfolio to NPV 8% and 2.8 yr payback PV3 Optimization Study: generate strong cash flows in series of low capital, quick On track to deliver 50% all price environments payback projects to production growth by 2021: 2020 Cobalt PEA Opportunity debottleneck operational 50-55 Mlbs copper and 1.5 pointing to US$1.7 billion Strong balance sheet to performance;10% production Moz silver post-expansion NPV 8% ; robust case to build a fund low-risk brownfield growth with 10% lower costs low cost, vertically integrated expansions and greenfield by 2021; further growth battery-grade cobalt Infill and step-out drilling to optionality possible by 2022 business in Chile extend mine life up to 2030; to date results pointing to To surface stakeholder value PV4 Expansion Study: higher grades and wider Strategic process in place, to through exploration and targeting 100,000+ tpd intercepts right-size or monetize operational excellence Capstone’s ownership CAPSTONE MINING (TSX:CS) • 3
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