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TSX: FM; LSE: FQM Cautio tionar nary y Note e Regar arding ing - PowerPoint PPT Presentation

Jan 25, 2024 •34 likes •364 views

TSX: FM; LSE: FQM Cautio tionar nary y Note e Regar arding ing Forwar ard-Looking Looking Stat atemen ement Some Some of of the the stat statemen ments ts con contain tained ed in in the the foll ollowing wing mat material

  1. TSX: FM; LSE: FQM

  2. Cautio tionar nary y Note e Regar arding ing Forwar ard-Looking Looking Stat atemen ement Some Some of of the the stat statemen ments ts con contain tained ed in in the the foll ollowing wing mat material rial are are for orwar ard-loo looking king st stat atements ments and and no not st statement ment of of facts acts. Su Such statemen st ements ts are are base based on on the the cu curr rren ent be beliefs liefs of of managemen management, t, as as well ell as as ass assum umpt ptions ions based based on on managemen management informat ormation ion curre urrently ntly available lable. For orwar ard-looking looking st statements ments are are sub subject ject to to various arious risks, risks, uncer ncerta taintie inties and and other ther fact actor ors that that co could uld cause ause actual ctual re results sults to to differ er materi erially ally from expect pected ed results sults. Reader ders must st rely on on their ir own evaluation ation of of these se uncertain tainti ties es. Note: all dollar amounts in US dollars unless otherwise indicated 2

  3. First st Quantum ntum Minerals rals – At a Glance ce • Industr ustry-Lea eadi ding ng Growth • A Glob obal al Compan any – Operations and projects in 8 countries – 5 major projects under development – Production capacities to rise to 1.1 Mtpa for copper and 110 ktpa for nickel • High-Quality Quality, Stabl able, e, Effici icien ent t Operat ation ions – 7 operations by 2018 – 2013 production:  copper 412,281 tonnes • Un Unique ue Core Strength gth  nickel 47,066 tonnes – In-house project development team  gold 248,078 ounces – Delivered projects at an average of 40% – Cash cost of production of the industry’s average capital per  copper $1.30/lb; nickel $5.02/lb tonne of capacity • Strong g Li Liquidi dity ty & Cash sh Flow • Strong g Track k Recor ord – Cash at Dec 31 ‘13 = $694.5M – Delivered over $2.4B in projects within – Cash from operations = $1.4B 6% of budget – Two five-year facilities – Returned a compounded annual gain of  $1.0B term loan; $1.5B revolver; Libor + 2.75% over 30% since listing – Two $1.14B Notes  6.75% due 2020; 7.00% due 2021 3

  4. 2013 – A Transf nsform ormat ativ ive e Year  Succes cessful fully ly acquired red Inmet met Mining ing Corp rpora rati tion on – Control of the Tier 1 Cobre Panama copper project – Added 3 well-run, low-cost operations  Restruc ructured tured financing ancing and nd capita ital l struc uctu ture re  Advan ance ced d projects ects unde der r developm opmen ent  Record produc uction tion at Flags gshi hip Ka Kansans sanshi hi mine; e; Guelb lb Moghre rein in; and nd Ravens enstho thorpe pe 4

  5. Cobre re Pa Panama ama – A Tier er 1 C Copper er Project ject • Acquired March 2013 • Critical review following acquisition – Focused mainly on Engineering, Contracts and Construction initially – Copied major areas of the design of the almost-complete Sentinel process plant • Made significant changes – Unwound ~US$1.7B of commitments – Rectified multiple deficiencies – Readied the site for construction – Connected minesite to portsite – Changed to an in-house, self-perform arrangement 5

  6. Cobre re Pa Panama ama – A Tier er 1 C Copper er Project ject • A larger, more robust project – Installed capacity Yrs 1-10 = ~70 Mtpa  17% higher than prior  Expansion up to 100 Mtpa beyond Yr 10 – Average annual LOM* copper production of 320,000 tonnes  ~ 20% higher than prior – Average annual LOM by-product production  100,000 ounces gold; 1,800,000 ounces silver and 3,500 tonnes molybdenum • Mine life of 34 years 6 * On the basis of the current Resource estimate and the planned installed capacity of about 70 Mtpa

  7. Cobre re Pa Panama ama – A Tier er 1 C Copper er Project ject • Capex estimate of $6.4 billion – inclusive of $913 million incurred prior to acquisition • Capital per installed tonne of capacity of $17,125 – ~25% lower than prior • A realistic and well-defined timeframe – 230 KV overland power line – Q4 ’15 – 300 MW powerstation – Q1 ‘17 – Tailings management facility – Q2 ’17 – Process plant construction – Q3 ‘17 – Commissioning & 1 st concentrate production – Q4 ‘17 7

  8. COBR BRE E PANAM AMA A PROJECT JECT – PROCESS CESS PLANT NT SITE TE EART RTHWORK ORKS 8

  9. COBR BRE E PANAM AMA A PROJECT JECT – MILL PAD EARTHW THWORK ORKS 9

  10. COBR BRE E PANAM AMA A PROJECT JECT – PROCESS CESS PLANT NT STOCKP OCKPIL ILE E PAD 10 10

  11. COBR BRE E PANAM AMA A PROJECT JECT – POWER WER STATION TION AREA EA 11 11

  12. COBR BRE E PANAM AMA A PROJECT JECT – BREA EAKW KWATER TER AND MATERIAL RIAL OFFLOAD ADIN ING G FACILIT ILITY 12 12

  13. Optimiz imizing ing Capit ital al Structu ructure re & F Financ ancial ial Flexibility xibility  Refinancing the short-term US$2.5B revolver at FQM (Akubra) with a five-year Term and Revolving Credit Facility  Changing the FQM (Akubra) Inc. US$1.49B 8.75% 2020 and US$500M 7.50% 2021 notes into new 6.75% 6-year notes and new 7.00% 7-year notes  In conjunction with the Exchange Offer, seeking covenant changes from the existing indentures to better match the Company's needs going forward  Making certain amendments to the existing indentures of the US$350M 7.25% Senior Notes due 2019 through a consent solicitation offer to bondholders  Retiring the project financing at Kevitsa and Kansanshi and putting in place a $350M unsecured facility at Kansanshi 13 13

  14. Curren rrent t Corporat rporate e Structu ructure re Chart t (Figures as of 30 September 2013) US$350 MM Senior Notes  LTM Sep-13 EBITDA: US$1.1 Bn  Total Debt / Total Leverage: US$0.8 Bn / 0.7x  Total Assets: US$8.2 Bn US$2.0 Bn Senior Notes 100% 100% 100% 100% 100% 100% 100% US$2.5 Bn RCF FQM FQM Australia Metal Corp FQM (Peru) FQM Finance Kiwara FQM (Aku kubra bra) Inc. . Scandinavia Holdings (BVI) Trading AG Ltd. Ltd. Resources Ltd. Ltd. Ltd.  LTM Sep-13 EBITDA: US$0.5 Bn US$110m short term facility  Total Debt / Total Leverage: US$2.5 Bn / 4.4x 100% 100% 100% 80% 100% 100% 100%  Total Assets: US$6.9 Bn Guelb Kevitsa Ravensthorpe Haquira Kansanshi Sentinel Enterprise Moghrein (Finland) (Australia) (Peru) (Zambia) (Zambia) (Zambia) (Mauritania) US$1.0 Bn senior US$215m Kevitsa 100% 100% 100% 80% secured term and facility revolving facility Cobre obre Las Cruces Çayeli Pyhäsalmi Panama (Spain) (Turkey) (Finland) (Panama) Restricted Group Represents Operating Company Guarantors of the FQM notes (1) Represents Operating Company Guarantors of the FQM (Akubra) notes Cobre Panama is an unrestricted sub of FQM (Akubra) but a restricted sub of FQM (1) Subordinated guarantees. Guarantor coverage ratio of 16% revenue and 8% EBITDA. 14 14

  15. Pro Forma rma Corporat rporate e Struct ructure ure Char art t (Figures as of 30 September 2013) US$2.28 Bn (1) New Senior Notes US$350m Senior Notes US$2.5 Bn 5 year Term and RCF  LTM Sept-13 EBITDA: US$1.6 Bn  Total Debt / Total Leverage: US$3.5 Bn / 2.1x  Total Assets: $15.0 Bn 100% 100% 100% 100% 100% 100% 100% 100% 100% 80% FQM FQM Kiwara Çayeli Bakir Metal Corp Australia FQM (Peru) FQM Finance Cobre Las Pyhäsalmi Minera Scandinavia Resources Isletmeleri Trading AG Holdings (BVI) Ltd. Ltd. Cruces S.A. Mine Oy Panama SA Ltd. Ltd. A.S. Ltd. US$110m Short term 100% 100% 100% 80% 100% 100% 100% 100% 100% 100% facility Guelb Cobre obre Kevitsa Ravensthorpe Haquira Kansanshi Sentinel Enterprise Las Cruces Çayeli Pyhäsalmi Moghrein Panama (Finland) (Australia) (Peru) (Zambia) (Zambia) (Zambia) (Spain) (Turkey) (Finland) (Mauritania) (Panama) US$350m unsecured term facility Represents Operating Company Guarantors (2) (1) Assuming all notes exchanged before early redemption date (2) Senior guarantees to be provided for the Credit Facility, the FQM Senior Notes and the New Senior Notes – all on a pari passu basis. Guarantor coverage ratio of 52% revenue and 44% EBITDA 15 15

  16. Advanced ed Projects jects Copper Smelter, Zambia • Processing capacity of 1.2 Mtpa — Combination of concentrate from Kansanshi & Sentinel — Average copper grade 26% • Copper production 300,000 Tpa; acid production 1.0 Mtpa • Estimates: − Capital cost of US$690M − Commissioning from mid-2014 • Estimated savings: − US$340M - US$510M/year • Expansion being planned to increase processing capacity to 2 Mtpa in 2017 16 16

  17. Advanced ed Projects jects 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 – Annual production up to 300,000 tonnes – US$2.0B capex (incl. Enterprise nickel project) – Completion targeted for mid-2014 • Includes 4 Mtpa nickel facility; flexibility to augment copper capacity 17 17

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