Post on 16-May-2015
The New Leader in Global Copper
April 2013
TSX: FM; LSE: FQM
Global Diversified
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Disclaimer
Certain statements and information contained in this presentation, including all statements that are not historical facts, contain forward-looking statements and forward-looking information within the meaning of
applicable securities laws. Such forward-looking statements or information include but are not limited to statements or information with respect to the anticipated commencement, completion and terms of the
proposed offer and the anticipated strategic and operational benefits of the offer. Often, but not always, forward-looking statements or information can be identified by the use of words such as “plans”,
“expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “projects”, “antic ipates” or “does not anticipate” or “believes” or variations of such words and phrases or
statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved.
With respect to forward-looking statements and information contained in this presentation, First Quantum has made numerous assumptions including among other things, assumptions about the price of
copper, gold, cobalt, nickel, PGE, and sulphuric acid, anticipated costs and expenditures, and First Quantum's ability to achieve its goals. Although management of First Quantum believes that the
assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that a forward-looking statement or information herein will prove to be
accurate. Forward-looking statements and information by their nature involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or
industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. These risks, uncertainties and other
factors include, but are not limited to, uncertainties surrounding the ability to realize operational synergies following completion of the offer, reliance on Inmet’s publicly available information which may not fully
identify all risks related to its performance, success in integrating the retail distribution systems, and the integration of supply chain management processes, future production volumes and costs, costs for
inputs such as oil, power and sulphur, political stability in Zambia, Peru, Mauritania, Finland, Turkey, Spain, Panama and Australia, adverse weather conditions in any of the foregoing countries, labor
disruptions, mechanical failures, water supply, procurement and delivery of parts and supplies to the operations and the production of off-spec material.
See First Quantum’s annual information form for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information. Although we have attempted to
identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors, many of which are
beyond the control of First Quantum, that might cause actual results, performances, achievements or events not to be anticipated, estimated or intended. Accordingly, readers should not place undue reliance
on forward-looking statements or information.
While First Quantum may elect to update the forward-looking statements at any time, First Quantum does not undertake to update them at any particular time or in response to any particular event, other than
as may be required by applicable securities laws. Investors and others should not assume that any forward-looking statement contained in this presentation represents management's estimate as of any date
other than the date of this presentation.
Neither First Quantum nor any of its directors or officers has verified the accuracy or completeness of information or statements contained herein which are made by or derived from third-party sources
(including any projections or estimates made by third-party research analysts). Such third-party sources may have failed to identify events or facts which may have occurred or which may affect the
significance or accuracy of any such information or statements. First Quantum has no means of verifying the accuracy or completeness of such information or statements made by or derived from third-party
sources or whether there has been any failure by such sources to identify events that may have occurred or may affect the significance or accuracy of any information or statements.
This presentation does not constitute an offer to buy or an invitation to sell, or the solicitation of an offer to buy or invitation to sell, any securities of First Quantum or Inmet. Such an offer may only be made
pursuant to the offer and takeover bid circular First Quantum has filed with the Canadian securities regulators and pursuant to registration or qualification under the securities laws of any other such jurisdiction.
In accordance with applicable Canadian securities regulatory requirements, all mineral reserve and mineral resource estimates disclosed herein have been prepared in accordance with Canadian National
Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"), classified in accordance with Canadian Institute of Mining Metallurgy and Petroleum's "CIM Standards on Mineral Resources
and Reserves Definitions and Guidelines" (the "CIM Guidelines"). The terms "mineral resources", "measured mineral resources", "indicated mineral resources" and "inferred mineral resources" are recognized
by Canadian securities regulatory authorities, however, they may not be recognized by the securities regulatory authorities of other jurisdictions. Pursuant to the CIM Guidelines, mineral resources have a
higher degree of uncertainty than mineral reserves as to their existence as well as their economic and legal feasibility. Inferred mineral resources, when compared with measured or indicated mineral
resources, have the least certainty as to their existence, and it cannot be assumed that all or any part of an inferred mineral resource will be upgraded to an indicated or measured mineral resource as a result
of continued exploration. Pursuant to NI 43-101, inferred mineral resources may not form the basis of any economic analysis, including any feasibility study. Accordingly, readers are cautioned not to assume
that all or any part of a mineral resource exists, will ever be converted into a mineral reserve, or is or will ever be economically or legally mineable or recovered.
Note: all dollar amounts in US dollars unless otherwise indicated; C$ indicates Canadian dollars
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Creating the New Leader in Global Copper
First Quantum is one of the world’s leading copper producers, with a geographically diversified portfolio of high-quality
operations and projects
Uniquely positioned to deliver Cobre Panama more effectively by leveraging our global project development expertise
– Maximize our in-house project development capability with prudent use of consultants and third party contractors
– Robust liquidity and balance sheet strength, to support development of future large scale mining projects with
cost efficiency and discipline
– Long standing commitment to operational, social and environmental excellence
The acquisition brings together the best talents of each company to create significant shareholder value
First Quantum presents an opportunity for investors to maintain / gain exposure to multiple transformational re-rating
events over the next five years with a base asset portfolio of high quality low cost assets in both emerging and
developed countries
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A Premier Base Metals Company
Unmatched Portfolio of World
Class Development Projects
Solid Platform of Diversified,
Stable Operations
Las Cruces, Spain Cu
Kevitsa, Finland Ni Cu
Pyhäsalmi, Finland Cu Zn
Çayeli, Turkey Cu Zn
Guelb Moghrein,
Mauritania Cu Au
Ravensthorpe, Australia Ni Co
Kansanshi, Zambia Cu Au
Cobre Panama, Panama Cu Au
Ag Mo
Kansanshi Expansion and
Smelter, Zambia Cu Au
Haquira, Peru Cu
Enterprise, Zambia Ni
Seven producing mines and six world class projects across eight countries and five continents
Sentinel, Zambia Cu
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High Quality Operations
Asset Location Ownership (1) 2012 Production 2012 Cash Cost Mine Life Reserves & Resources (Contained)
Kansanshi Zambia 80% 261 kt Cu
136 koz Au US$1.49 / lb Cu 2037
Reserves 5,782 kt Cu, 3.3 Moz Au
M&I Resources 6,252 kt Cu, 3.3 Moz Au
Inferred 2,593 kt Cu, 1.3 Moz Au
Las Cruces Spain 100% 68 kt Cu US$1.16 / lb Cu 2022
Reserves 768 kt Cu
M&I Resources 768 kt Cu
Inferred 424 kt Cu
Guelb Moghrein Mauritania 100% 38 kt Cu
61 koz Au US$1.48 / lb Cu 2019
Reserves 306 kt Cu, 0.7 Moz Au
M&I Resources 369 kt Cu, 0.8 Moz Au
Inferred 73 kt Cu, 0.2 Moz Au
Çayeli Turkey 100% 31 kt Cu
41 kt Zn US$0.88 / lb Cu 2019+
Reserves 216 kt Cu, 258 kt Zn
M&I Resources 421 kt Cu, 414 kt Zn
Inferred 21 kt Cu, 52 kt Zn
Pyhäsalmi Finland 100% 13 kt Cu
26 kt Zn US$(0.68) / lb Cu 2018
Reserves 91 kt Cu, 157 kt Zn
M&I Resources 142 kt Cu, 198 kt Zn
Ravensthorpe Australia 100% 33 kt Ni US$5.97 / lb Ni 2049
Reserves (2) 1,357 kt Ni
M&I Resources 1,642 kt Ni
Inferred 605 kt Ni
Kevitsa Finland 100% 8 kt Cu
4 kt Ni
US$5.47 / lb Ni
US$1.28 / lb Cu 2033
Reserves 486 kt Ni, 643 kt Cu
M&I Resources 712 kt Ni, 973 kt Cu
Inferred 101 kt Ni, 125 kt Cu
(1) Ownership of Inmet’s assets shown pro-forma for acquisition of 100% of Inmet
(2) Measured and indicated recoverable resources
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Unmatched Portfolio of Development Projects
Expansion Projects
Asset Location Ownership Target
Production Completion
Kansanshi Expansion
and Copper Smelter Zambia
80%
(100% smelter) 400 kt Cu Mid – 2014
Greenfield Projects
Asset Location Ownership (1) Target
Production Completion Reserves & Resources (Contained)
Sentinel Zambia 100% 270-300 kt Cu 2014
Reserves 3,870 kt Cu
M&I Resources 5,238 kt Cu
Inferred 697 kt Cu
Enterprise Zambia 100% 38-60 kt Ni 2014
Reserves 363 kt Ni
M&I Resources 431 kt Ni
Inferred 50 kt Ni
Cobre Panama Panama 80% 266 kt Cu 2016
Reserves 11,813 kt Cu, 192 kt Mo, 7.3 Moz Au, 131.0 Moz Ag
M&I Resources 14,820 kt Cu, 239 kt Mo, 9.0 Moz Au, 170.0 Moz Ag
Inferred 8,318 kt Cu, 125 kt Mo, 3.5 Moz Au, 92.0 Moz Ag
Haquira Peru 100% N/A N/A
M&I Resources 3,418 kt Cu, 0.6 Moz Au
Inferred 2,030 kt Cu, 0.3 Moz Au
(1) Ownership of Inmet’s assets shown pro-forma for acquisition of 100% of Inmet
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0
10
20
30
40
50
60
70
80
90
--
400
800
1,200
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Mufulira & Nkana Bwana / Lonshi Frontier Kansanshi Guelb Moghrein Kevitsa
Sentinel Cayeli Las Cruces Pyhasalmi Cobre Panama Nickel
A World Class Growth Profile
Bwana Lonshi
2001
Kansanshi
2004
Guelb Moghrein
2006
Frontier
2007
Ravensthorpe
2011
Kevitsa (1)
2012
Kansanshi
Expansion
and Smelter
Sentinel
Cobre
Panama Haquira
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018+
Proven Track Record of Developing & Operating Mines Unmatched Project Pipeline
Successfully Commissioned 6 mines
in 12 Years Across 5 Countries
ktpa Cu production
Well-positioned to deliver
industry-leading growth
Enterprise
ktpa Ni production
(1) Nickel and copper mine
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Leading Copper Growth
Source: BrookHunt
1.8
1.5 1.5
1.3 1.2
0.9 0.8
0.8
0.6
0.5 0.5 0.5 0.4 0.4
0.3
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2
2018E Copper Production, Mt
9
0 10 20 30
Tampakan(Xstrata)
Konkola North(Vale)
Toromocho(Chinalco)
Sierra Gorda(KGHM)
Las Bambas(Xstrata)
Ministro Hales(Codelco)
Cobre Panama(First Quantum)
M&I Resources Inferred Resources
Cobre Panama – A Tier-One Project
Cobre Panama is the world’s largest copper project currently under construction
– Over 50 Blbs of contained copper, and 13 Moz of contained gold resources
– Commercial production is expected to commence in 2016, with an
estimated mine life of over 40 years
– Average life-of-mine production of 266 ktpa of copper, with significant gold,
silver and molybdenum by-products
We are currently assessing potential cost savings and design specification
changes to the existing engineering study completed by in 2012
– Current estimated a total capital cost of US$6.2 Bn
Copper Production Profile (kt)
--
100
200
300
400
2015 2019 2023 2027 2031 2035 2039 2043 2047 2051 2055
Feasibility
Stage Assets
Construction
Stage Assets
Major Copper Development Projects (Contained Cu Mt)
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By FQM
Engineering &
Design
Building Cobre Panama Using the First Quantum Project
Philosophy
• A finished project must perform to
expectations
– Set ambitious targets for schedule, cost
and performance
– Adhere to time schedule
– Adhere to capital cost budget
• Industry leading performance
– Lowest capital intensity achieved
Our Project Development Philosophy Outcomes
Traditional Project First Quantum Project Model
EPCM Engineer
Owner
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Sentinel – On-Schedule and On-Budget
Total project progress to date is ~27% on a cumulative basis
Construction
57% concrete poured (total of 41,920 m3)
– Continued works on pipe rack, surge area, e-buildings and
concentrate area concrete
Mill assemblies and installations well underway
Continued steel works: Pipe rack, mill building. thickener tanks, floor
gore and side walls
4 environmental containment areas on site completed
Commenced excavation for the Mine Service Administration building
Assembled Mill 110 Ton Gantry Crane segments
Labour
Current workforce : 2,062 people
3,000,000 man-hours without a lost time incident as of 31 March
2013
Mill area, 31 March 2013
Rougher flotation, 31 March 2013
Key Project Developments
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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