Capstone Announces Updated Santo Domingo Feasibility Study – Building a World Class District in Chile
(All amounts in US$ unless otherwise indicated)
“The release of the updated feasibility study for our
2024 SANTO DOMINGO FEASIBILITY STUDY SUMMARY
-
The 2024 FS outlines a robust copper-iron-gold project with an after-tax net present value at an 8% discount rate (“NPV8%”) of
$1.7 billion and an after-tax internal rate of return (“IRR”) of 24.1% -
Over the first seven years of the mine plan, production is expected to average 106,000 tonnes of copper and 3.7 million tonnes of iron concentrate at first quartile cash costs of
$0.28 per payable pound of copper produced-
Over the Project’s 19-year mine life, production is expected to average 68,000 tonnes of copper and 3.6 million tonnes of iron concentrate at first quartile cash costs of
$0.33 per payable pound of copper produced
-
Over the Project’s 19-year mine life, production is expected to average 68,000 tonnes of copper and 3.6 million tonnes of iron concentrate at first quartile cash costs of
-
Total initial capital cost of
$2.3 billion drives a capital intensity of approximately$21,900 per tonne of annual copper equivalent production over the life of mine -
A 19-year mine life is supported by a higher Mineral Reserve1 estimate of 436 million tonnes at a copper grade of 0.33%, iron ore grade of 26.5%, and a gold grade of 0.05 grams per tonne
- Mineral Reserve tonnes have increased by 11% while contained copper has increased by 23% since the 2020 Feasibility Study
-
Total Measured and Indicated (“M&I”) Mineral Resources of 547 million tonnes at a copper grade of 0.31% and a gold grade of 0.04 grams per tonne, including 506 million tonnes with an iron grade of 25.8%
- M&I Resource tonnes increased by 2% while contained copper in M&I Resources increased by 6% since the 2020 Feasibility Study
-
The Company plans to progress several value enhancement initiatives within the Mantoverde-Santo Domingo (“MV-SD”) district that are noted in the Opportunities section but not yet incorporated into the base case 2024 FS, including:
- The processing of Santo Domingo’s oxide material using Mantoverde’s excess SX-EW capacity
- The recovery of cobalt and additional copper from a pyrite concentrate
-
Ongoing exploration of the MV-SD district, including the recently acquired
Sierra Norte deposit
For a virtual tour of
1 Comprised of 131 million tonnes in the Proven category and 305 million tonnes in the Probable category. Please refer to the detailed breakdown of the Santo Domingo Mineral Reserve estimate below.
SUMMARY OF RESULTS
The 2024 FS reflects the results of the Company’s further technical and optimization work at
|
2024 Feasibility Study |
2020 Feasibility Study |
Life of Mine (“LOM”) (years) |
19 |
18 |
Initial capital cost (US$ billions) |
|
|
After-tax NPV(8%) (US$ billions) |
|
|
After-tax IRR (%) |
24.1% |
21.8% |
After-tax Payback period (years) |
3.0 |
2.8 |
Average Annual First Seven Years of Production |
|
|
Copper (“Cu”) production2 (thousand tonnes) |
106 |
103 |
Iron concentrate production (“Fe”) (million tonnes) |
3.7 |
3.3 |
Gold production (“Au”) (thousand ounces) |
35 |
30 |
C1 cash costs per pound of payable copper produced (by-product basis) |
|
|
C1 cash costs per pound of payable copper equivalent produced (co-product basis) |
|
|
Average Annual for LOM |
|
|
Copper production (thousand tonnes)5 |
68 |
62 |
Iron concentrate production (million tonnes) |
3.6 |
4.2 |
Gold production (thousand ounces) |
22 |
17 |
C1 cash costs per pound of payable copper produced (by-product basis) |
|
|
C1 cash costs per pound of payable copper equivalent produced (co-product basis) |
|
|
2 Contained production includes recovery loss.
3 C1 cash costs are net of magnetite iron and gold by-product credits and selling costs. These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release.
4 C1 cash costs on a co-product basis consist of mining costs, processing costs, mine-level G&A, gold revenue credit, and refining charges over payable copper equivalent pounds (copper plus magnetite). These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release.
5 After recovery loss.
First Seven Years Operating Statistics Summary |
2024 Feasibility Study |
2020 Feasibility Study |
Total tonnes milled (million tonnes) |
172.6 |
162.1 |
Strip ratio (waste to ore) |
2.3:1 |
3.4:1 |
Head Grade |
|
|
Copper (% Cu) |
0.48 |
0.48 |
Iron (% Fe) |
29.0 |
29.3 |
Gold (g/t Au) |
0.07 |
0.06 |
Recovery |
|
|
Copper5 |
90.3% |
93.8% |
Iron mass |
15.1% |
14.1% |
Gold |
67.8% |
63.2% |
Life of Mine Operating Statistics Summary |
2024 Feasibility Study |
2020 Feasibility Study |
Total tonnes milled (million tonnes) |
436.1 |
392.3 |
Strip ratio (waste to ore) |
2.5:1 |
3.3:1 |
Head Grade |
|
|
Copper (% Cu) |
0.33 |
0.30 |
Iron (% Fe) |
26.5 |
28.2 |
Gold (g/t Au) |
0.05 |
0.04 |
Recovery |
|
|
Copper6 |
90.1% |
93.4% |
Iron mass |
15.7% |
19.1% |
Gold |
64.7% |
60.1% |
Commodity Price Assumptions |
|
|
Copper (per pound) |
|
|
P65 Index CFR China iron ore (per tonne)7 |
|
|
Gold (per ounce) |
|
|
Project Valuation Metrics – Price Sensitivities
|
NPV (after-tax, 8% discount) (US$ billions) |
IRR (after-tax) (%) |
Payback period (after-tax) (years) |
|
|||
Base Case pricing +10% |
|
27.2% |
2.8 |
Base Case pricing |
|
24.1% |
3.0 |
Base Case pricing -10% |
|
20.8% |
3.4 |
6 Copper recovery is for the copper concentrator only.
7 The 2024 FS includes three iron ore magnetite products, a 62% Fe magnetite, a 65% Fe magnetite, and a 67% Fe magnetite. For more details regarding the pricing breakdown, please see section “Commodity Pricing – Iron Ore” and Exhibit 1.
The updated
The
The Project is located 35 kilometres northeast of our Mantoverde copper-gold mine, 50 kilometres southwest of Codelco's
For the first seven years of full operation,
For the first seven years of operation, the annual average iron concentrate production is estimated to be 3.7 million dmt. Over the LOM, the iron concentrate production is estimated at an annual average of 3.6 million dmt, with a total estimated production of approximately 68.4 million dmt.
MINERAL RESERVE ESTIMATE
The updated Mineral Reserve estimate as at
Mineral Reserve Estimate as at |
|||||||
Reserve Category |
Grade |
Contained Metal |
|||||
Tonnage
|
Cu
|
Fe
|
Au
|
Cu
|
Fe
|
Au
|
|
Proven Reserves |
130.9 |
0.52 |
27.2 |
0.07 |
674.5 |
12.6 |
291 |
Probable Reserves |
305.1 |
0.25 |
26.2 |
0.04 |
760.7 |
55.8 |
346 |
Total Reserves |
436.1 |
0.33 |
26.5 |
0.05 |
1,435.2 |
68.4 |
637 |
Mineral Reserve Estimate Notes:
-
Mineral Reserves are reported as constrained within Measured and Indicated Resources and pit designs optimized using the following economic and technical parameters: metal prices of
US$3.75 /lb Cu,US$1,400 /oz Au and Fe prices ranging fromUS$69 /dmt toUS$114.51 /dmt based on the Fe grade in concentrate (net of Fe concentrate transport costs); average recovery to concentrate is 90.1% for Cu and 56.3% for Au, with magnetite concentrate recovery varying on a block-by-block basis; copper concentrate treatment charges ofUS$80 /dmt, U$0.08/lb of copper refining charges,US$5.0 /oz of gold refining charges,US$40 /wmt andUS$25.75 /dmt for shipping copper and iron concentrates respectively; waste and ore mining cost of$1.55 /t and process and G&A+SUSEX ofUS$9.77 /t processed; average pit slope angles that range from 36.3° to 47.9°; a 2% royalty rate assumption and an assumption of 100% mining recovery. - Rounding as required by reporting standards may result in apparent summation differences between tonnes, grade and contained metal content.
- Tonnage measurements are in metric units. Copper and iron grades are reported as percentages, gold as grams per tonne. Contained gold ounces are reported as troy ounces, contained copper as million pounds and contained iron as metric million tonnes.
MINERAL RESOURCE ESTIMATE
Following is the current Mineral Resource Estimate as at
Category |
Deposit |
Mt |
NSR ($/t) |
Cu (%) |
Fe (%) |
Au (g/t) |
Cu kt |
Fe Mt |
Au Koz |
Measured |
|
134 |
46 |
0.51 |
26.9 |
0.07 |
679 |
36 |
293 |
Indicated |
|
372 |
33 |
0.24 |
25.4 |
0.03 |
892 |
95 |
405 |
Estrellita |
41 |
24 |
0.32 |
- |
0.03 |
133 |
- |
44 |
|
Sub-Total |
413 |
32 |
0.25 |
n/a |
0.03 |
1,025 |
95 |
449 |
|
Total Measured and Indicated |
547 |
35 |
0.31 |
n/a |
0.04 |
1,704 |
131 |
742 |
|
Inferred |
|
203 |
28 |
0.19 |
22.5 |
0.03 |
384 |
46 |
171 |
Estrellita |
27 |
25 |
0.34 |
- |
0.03 |
93 |
- |
29 |
|
Total Inferred |
230 |
28 |
0.21 |
n/a |
0.03 |
477 |
46 |
200 |
Mineral Resource Estimate Notes:
- Mineral Resources in this document are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
- The average Iron grades for the Project (Total Indicated, Total Measured plus Indicated, and Total Inferred Resources) cannot be calculated because Estrellita does not contain iron resources.
-
Notes specific to the Mineral Resources for the
Santo Domingo andIris Norte deposits: a. Mineral Resources for SD include Iris. b. Mineral Resources are reported using a net smelter return (NSR) cut-off value ofUS$9.85 /t. NSR is calculated using average long-term prices ofUS$4.10 /lb Cu,US$1,600 /oz Au, and Fe prices that depend on the expected grade of the Fe concentrate (US$94.75 /dmt or$129.77 /dmt or$140.26 /dmt Fe concentrate). c. Mineral Resources are constrained by preliminary pit shells derived using a Lerchs–Grossmann algorithm and the following assumptions: pit slopes 36.3°- 47.9°; mining cost is calculated using a function that depends on where the material comes from (Santo Domingo orIris Norte ) and its destination (dumps, plant or stock); processing cost based on Fe concentrate routing code (including G&A costs); processing recovery based in the recovery equations for copper, gold, and iron as detailed above. -
Notes specific to the Mineral Resources for the Estrellita deposit: a. Mineral Resources are reported using an NSR cut-off value of
US$9.63 /t. NSR is calculated using average long-term prices ofUS$4.10 /lb Cu andUS$1,600 /oz Au. b. Only copper, and gold were considered in the NSR calculation; iron was excluded. c. Mineral Resources are constrained by preliminary pit shells generated using a Lerchs–Grossmann algorithm and the following assumptions: pit slopes 43º; mining cost ofUS$1.55 /t, processing cost ofUS$9.46 /t (including G&A cost); processing recovery are calculated based in the recovery curves for copper and gold. - Rounding as required by reporting standards may result in apparent summation differences.
- Tonnage measurements are in metric units. Copper and iron are reported as percentages (%) and gold as grams per tonne (g/t).
For this update, Capstone undertook significant revisions and improvements to the geological models (lithology and oxidation models), the domaining strategy and the estimation scheme for both deposits. Two block models, one for
When comparing only the 2024 Mineral Resources for
Readers are advised that Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. Mineral Resource estimates do not account for mineability, selectivity, mining loss and dilution. These Mineral Resource estimates include inferred Mineral Resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as Mineral Reserves. Even though test mining has been undertaken in areas with Measured and Indicated class Mineral Resources, there is no certainty that Inferred Mineral Resources will be converted to Measured and Indicated categories through further drilling, or into Mineral Reserves, once economic considerations are applied.
MINE PRODUCTION SCHEDULE
The cash flow model is supported by a mine plan developed to an annual level of detail, which is available in Exhibit 1 at the end of this release. Approximately 45 million tonnes of material would be pre-stripped prior to start-up of operations and used in the construction of the TSF starter dam. The overall strip ratio for the LOM is 2.5:1.
PROCESS DESCRIPTION
The
The primary crushing plant will process run of mine (“ROM”) ore feed in a gyratory crusher. A belt feeder transfers the ore from crusher area to the stockpile feed conveyor, and ultimately discharges fresh ore over a covered conical coarse ore stockpile. The stockpile allows ore reclaim using four apron feeders located within the reclaim tunnels (two trains of two feeders), which feed two parallel grinding circuits via dedicated conveyors.
Each grinding circuit consists of one 18 MW autogenous grinding mill (“AG mill”), one pebble AG mill discharge screen, two pebble crushers (duty & standby), one cyclone cluster and one ball mill. The AG mill product slurry discharges over a horizontal single deck vibrating screen for pebble washing and transferring of pebbles to pebble conveyors and then to pebble crushing. Crushed pebbles report to the AG mill feed conveyor.
There is the option of bypassing the pebble crushers and recycling uncrushed material to the AG mill using the same belt conveyor system, when required. Also, a belt plow mechanism is available on the conveyors for purging pebbles to grade to aid grind-out of mills when required.
The AG mill screen undersize feeds the 9 MW variable speed ball mill and discharges into the grinding cyclone cluster feed box, where it is mixed with the ball mill product and is pumped to a cluster of 33” classification cyclones. Cyclone underflow reports by gravity to the ball mill and cyclone overflow feeds the downstream copper flotation circuit.
Copper flotation consists of conventional rougher cell flotation, regrinding and classification, with Jameson Cells used in the cleaner scalper, cleaner scavenger, and re-cleaner stages. The rougher flotation stage recovers both copper minerals and pyrite minerals. The cleaner circuit selectively recovers copper sulphides and pyrite preferentially reports to the cleaner scavenger tail stream. There is allowance in the design for future installation of a pyrite recovery circuit to recover pyrite that contains cobalt. Final copper concentrate is pumped to downstream copper thickening and dewatering prior to stockpiling and load-out.
The iron concentrate plant is designed to produce two simultaneous products, determined by the nature of the magnetite mineral: a) a higher iron grade product (“high grade concentrate”), and; b) a lower iron grade (“low grade concentrate”).
A detailed Mine Production Summary and Plant Feed Production Schedule showing tonnes processed, grades and recoveries is available in Exhibit 1 at the end of this release.
The tailings storage system will consist of a tailings storage facility (“TSF”) located approximately 2 kilometres southeast of the proposed process plant. The TSF is designed to store approximately 361 million tonnes of high density thickened tailings, which is sufficient capacity for the approximately 19 years of the mine life. Storage of both desalinated and process water is proposed in lined ponds near the plant site. Water make-up is proposed to be desalinated water.
OFFSITE INFRASTRUCTURE AND SERVICES
The 2024 FS includes 100% of the capital requirements for a greenfield port in the Punta Roca Blanca area (“Puerto Santo Domingo”) on the coast 43 kilometres north of
The planned route for transporting cargo, staff and equipment to the
WATER AND CONCENTRATE TRANSPORT
The process water required by the
A magnetite concentrate pipeline will transport magnetite concentrate from the process plant to the filter plant at the port via a pipeline starting at an elevation of 1,027 masl and ending at the port at an elevation of 16 masl. Water recovered from the magnetite concentrate filtering process at the port will also be recycled and reused. The copper concentrate will be trucked from the site to
Both the water and the concentrate pipelines will use the same permitted right-of-way and will run parallel to existing roads for the majority of the distance from the mine area to the port. The pipeline route will largely follow the valleys with the single route high point located approximately 45 kilometres from the mine site near the Mantoverde mine operation.
POWER
INITIAL CAPITAL COST ESTIMATE
The initial capital costs for the
INITIAL CAPITAL COST ESTIMATE (by area) |
($ millions) |
Mine |
370.3 |
Processing plant |
485.6 |
Tailings and water reclaim |
66.7 |
Plant infrastructure |
144.4 |
Port & port infrastructure |
283.4 |
External infrastructure |
150.5 |
Total Direct Cost |
1,500.9 |
Indirect costs |
413.9 |
Owner costs |
108.9 |
Contingency (~15%) |
291.0 |
Total Indirect Costs |
813.8 |
TOTAL INITIAL CAPITAL COSTS |
2,314.7 |
Mine pre-production pre-strip costs are estimated at
SUMMARY OF OPERATING COST ESTIMATE
As shown, the total by-product C1 cash costs8 over LOM are estimated at
Total Project Operating Costs10 |
|||
LOM Total ($ millions) |
LOM Average ($/t milled) |
LOM C1 Cash Costs11 ($/lb payable Cu) |
|
Mining |
1,588 |
3.64 |
0.58 |
Processing |
3,708 |
8.51 |
1.35 |
G&A |
549 |
1.26 |
0.20 |
Sub-Total |
|
|
|
By-Product Credits |
|
|
(2.12) |
Treatment and Refining Charges and Selling Costs |
|
|
0.32 |
TOTAL C1 cash costs12 per pound of payable copper produced |
|
|
|
Mining costs in the above table exclude deferred stripping (included as capital expenditures) of
PERMITTING
In
8 C1 cash costs are net of magnetite iron and gold by-product credits and selling costs. These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release.
9 C1 cash costs on a co-product basis consist of mining costs, processing costs, mine-level G&A, gold revenue credit, and refining charges over payable copper equivalent pounds (copper plus magnetite) or magnetite equivalent tonnes (magnetite plus copper). These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release.
10 These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release. Totals may not sum due to rounding.
11 These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release.
12 C1 cash costs are net of magnetite iron and cash gold by-product credits and selling costs. These are Non-GAAP performance measures; please see “Non-GAAP and Other Performance Measures” at the end of this news release.
COMMODITY PRICING
The updated 2024 feasibility study assumes analyst consensus long-term commodity price assumptions for copper, iron ore, and gold.
Copper
Capstone markets copper concentrate from its four mining operations.
The analyst consensus long-term copper price was determined to be
Iron
The analyst consensus long-term 62% and 65% (CFR China) prices were determined to be
OPPORTUNITIES
The company plans to continue to progress several value enhancement initiatives within the Mantoverde-Santo Domingo district that are not yet incorporated into the base case 2024 FS, which so far only considers the processing of copper and iron ore concentrate at
Copper Oxides
Capstone plans to progress drilling and studies regarding the processing of Santo Domingo’s oxide material using Mantoverde’s excess SX-EW capacity. To date, oxide materials have been recognized in the shallower portions of the
Cobalt
A district cobalt plant for the Mantoverde-Santo Domingo district is designed to unlock cobalt production while reducing sulphuric acid consumption and increasing heap leach copper production. The cobalt recovery process comprises a pyrite flotation step to recover cobaltiferous pyrite from the tailings streams at
As currently envisioned, a smaller capacity countercurrent ion-exchange plant will initially treat cobalt by-product streams from Mantoverde producing up to 1,500 tonnes per annum of cobalt, and following sanctioning of the
Capstone’s Mantoverde mine will be able to use the planned
Exploration in the
Capstone has significant untapped exploration potential within Mantoverde-Santo Domingo district. At Mantoverde, there are 0.3 billion tonnes of Measured & Indicated and 0.6 billion tonnes of Inferred sulphide resources not in reserves. At
Subsequent to the quarter ended
13 This is an historic resource (not 43-101 compliant). Please refer to the notes outlined in Exhibit 2 for more details.
ENVIRONMENTAL AND SOCIAL BENEFITS
Capstone’s Sustainable Development Strategy reflects the Company’s core values and commitment to responsible mining practices. Environmental and social benefits embedded within the updated
-
The base case
Santo Domingo plan is expected to produce copper and a high-quality iron ore magnetite concentrate, supporting the world’s decarbonization efforts. Capstone is also working to add a third critical metal in cobalt to Santo Domingo’s production profile. -
Santo Domingo is expected to generate over 1,000 jobs. Training programs and strategic partnerships with technical schools in nearby Chañaral andDiego de Almagro are also planned. - Capstone expects to enter into a PPA for Santo Domingo’s power requirements that contains a significant renewable energy component. Capstone is targeting greater than 90% renewable electricity across our portfolio by 2030.
- The mining fleet features electric shovels, similar to the electric shovels at Capstone’s Mantoverde mine which reduce emissions relative to diesel-powered equipment.
- The mine plan has a lower strip ratio when compared to the previous study, which translates to less waste per tonne of ore, and less mined material per tonne of metal.
- The updated processing plant features an approximate 40% footprint reduction compared to the prior plan, minimizing footprint associated earthworks and environmental impacts.
- The covered primary stockpile and rotainers for copper concentrate shipment are examples of best-practice dust suppression capabilities.
- The processing flowsheet features fully autogenous grinding, reducing steel consumption.
- High density thickeners reduce water consumption by maximizing the recycling of water and minimizing evaporation losses in the tailings dam, ultimately reducing requirements for desalinated water and pumping.
- The tailings storage facility design exceeds the Chilean standards and is aligned with Capstone’s corporate commitment to adopt the Global Industry Standard on Tailings Management. Furthermore, the potential future cobalt production would convert waste in the tailings stream, an environmental liability, into metal, an economic asset.
-
The Company plans to support the local community of
Diego de Almagro with 10 litres per second of potable water coming from the desalination plant. -
The planned
Santo Domingo multi-user port will provide benefits to the local region. In addition, trucking emissions for transporting Mantoverde’s copper concentrate will be significantly reduced. -
The updated 2024 FS outlines over
$2 billion in-country taxes paid inChile over the life of mine.
NATIONAL INSTRUMENT 43-101
A National Instrument 43-101 ("NI 43-101") Technical Report will be prepared to summarize the results of the 2024 Feasibility Study by the Qualified Persons and will be filed on SEDAR+ within 45 days of this news release.
Readers are cautioned that the conclusions, projections and estimates set out in this news release are subject to important qualifications, assumptions and exclusions, all of which will be detailed in the 2024 technical report. To fully understand the summary information set out above, the 2024 technical report that will be filed on SEDAR+ at www.sedarplus.ca should be read in its entirety.
QUALIFIED PERSONS
About
Capstone Copper’s strategy is to unlock transformational copper production growth while executing on cost and operational improvements through innovation, optimization and safe and responsible production throughout our portfolio of assets. We focus on profitability and disciplined capital allocation to surface stakeholder value. We are committed to creating a positive impact in the lives of our people and local communities, while delivering compelling returns to investors by responsibly producing copper to meet the world’s growing needs.
Further information is available at www.capstonecopper.com
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This document may contain “forward-looking information” within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements”). These forward-looking statements are made as of the date of this document and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation.
Forward-looking statements relate to future events or future performance and reflect Company management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the estimation of mineral reserves and mineral resources, the conversion of mineral resources to mineral reserves, the ability to successfully complete the strategic review process, the ability to further enhance the value of the project, the expected timing for commencement of construction of the
Non-GAAP and Other Performance Measures
The Company uses certain performance measures in its analysis. "C1 Cash Costs" and "Total Project Operating Cost" are Non-GAAP performance measures. These Non-GAAP performance measures are included in this document because these statistics are key performance measures that management uses to monitor performance, to assess how the Company is performing, and to plan and assess the overall effectiveness and efficiency of mining operations. These performance measures do not have a standard meaning within IFRS and, therefore, amounts presented may not be comparable to similar data presented by other mining companies. These performance measures should not be considered in isolation as a substitute for measures of performance in accordance with IFRS.
Exhibit 1: Detailed Cash Flow Model and Select Key Assumptions
|
Unit |
LOM |
-3 |
-2 |
-1 |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
11 |
12 |
13 |
14 |
15 |
16 |
17 |
18 |
19 |
|
||||||||||||||||||||||||
Production Summary |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mineral Resource Mined to Plant |
kt |
377,303 |
-- |
-- |
-- |
19,939 |
26,279 |
21,319 |
25,086 |
26,278 |
23,726 |
23,722 |
16,311 |
18,838 |
23,726 |
18,234 |
17,929 |
21,884 |
11,486 |
15,140 |
18,352 |
16,641 |
17,588 |
14,826 |
Mineral Resource Mined to Stockpile |
kt |
58,753 |
-- |
1,149 |
5,126 |
1,106 |
989 |
74 |
9,251 |
6,623 |
13,522 |
6,634 |
1,928 |
2,104 |
8,559 |
692 |
995 |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
Waste Mined |
kt |
1,074,757 |
-- |
8,859 |
26,321 |
66,716 |
62,260 |
62,080 |
50,408 |
43,729 |
51,137 |
58,265 |
62,652 |
62,960 |
57,480 |
66,275 |
60,415 |
61,860 |
56,808 |
62,241 |
66,139 |
54,252 |
24,250 |
9,652 |
Mineral Resource Rehandled |
kt |
58,753 |
-- |
-- |
-- |
-- |
-- |
4,962 |
1,267 |
-- |
-- |
-- |
7,480 |
4,887 |
-- |
5,491 |
5,862 |
1,841 |
12,240 |
8,586 |
-- |
2,320 |
1,400 |
2,418 |
Throughput |
ktpd |
n/a |
-- |
-- |
-- |
54.6 |
72.0 |
72.0 |
72.2 |
72.0 |
65.0 |
65.0 |
65.2 |
65.0 |
65.0 |
65.0 |
65.2 |
65.0 |
65.0 |
65.0 |
50.3 |
51.9 |
52.0 |
47.2 |
Resource Sent to Mill |
kt |
436,056 |
-- |
-- |
-- |
19,939 |
26,279 |
26,281 |
26,353 |
26,278 |
23,726 |
23,722 |
23,791 |
23,725 |
23,726 |
23,725 |
23,791 |
23,725 |
23,726 |
23,725 |
18,352 |
18,961 |
18,988 |
17,243 |
Cu Head Grade |
% |
0.33% |
-- |
-- |
-- |
0.50% |
0.59% |
0.48% |
0.49% |
0.43% |
0.45% |
0.39% |
0.26% |
0.22% |
0.30% |
0.33% |
0.31% |
0.22% |
0.20% |
0.29% |
0.20% |
0.12% |
0.11% |
0.13% |
|
g/t |
0.05 |
-- |
-- |
-- |
0.07 |
0.08 |
0.07 |
0.07 |
0.06 |
0.07 |
0.06 |
0.04 |
0.03 |
0.04 |
0.05 |
0.05 |
0.03 |
0.03 |
0.04 |
0.03 |
0.02 |
0.01 |
0.01 |
|
% |
26.5% |
-- |
-- |
-- |
25.0% |
29.0% |
26.4% |
29.4% |
30.0% |
32.0% |
30.7% |
26.6% |
26.7% |
28.4% |
25.8% |
23.2% |
21.4% |
21.9% |
21.2% |
24.1% |
25.8% |
26.4% |
27.5% |
Cu Recovery |
% |
90.1% |
-- |
-- |
-- |
90.6% |
91.6% |
91.2% |
91.0% |
88.5% |
89.0% |
90.4% |
90.0% |
89.5% |
89.7% |
90.1% |
90.0% |
89.4% |
88.7% |
90.1% |
90.4% |
89.7% |
88.7% |
89.2% |
Au Recovery |
% |
64.7% |
-- |
-- |
-- |
70.2% |
71.0% |
68.9% |
68.1% |
66.0% |
66.0% |
64.8% |
60.6% |
58.9% |
61.3% |
62.1% |
62.5% |
59.5% |
58.2% |
62.6% |
58.8% |
57.1% |
57.1% |
53.0% |
Fe Recovery |
% |
59.2% |
-- |
-- |
-- |
26.9% |
48.1% |
59.7% |
56.6% |
57.0% |
56.2% |
51.9% |
68.0% |
70.7% |
62.1% |
43.8% |
46.0% |
67.5% |
53.3% |
38.6% |
64.4% |
88.7% |
87.5% |
93.2% |
Cu Production |
kt |
1,293.1 |
-- |
-- |
-- |
90.8 |
142.0 |
114.9 |
118.1 |
98.9 |
95.4 |
84.4 |
56.0 |
47.1 |
64.6 |
70.5 |
67.1 |
47.3 |
42.2 |
61.6 |
33.0 |
20.7 |
19.2 |
19.4 |
Au Production |
koz |
412 |
-- |
-- |
-- |
31 |
47 |
38 |
39 |
32 |
33 |
27 |
18 |
13 |
21 |
23 |
22 |
14 |
12 |
18 |
10 |
6 |
5 |
4 |
Fe Production |
Mt |
68.4 |
-- |
-- |
-- |
1.3 |
3.7 |
4.1 |
4.4 |
4.5 |
4.3 |
3.8 |
4.3 |
4.5 |
4.2 |
2.7 |
2.5 |
3.4 |
2.8 |
1.9 |
2.8 |
4.3 |
4.4 |
4.4 |
Cu Payable |
kt |
1,242.9 |
-- |
-- |
-- |
87.5 |
136.9 |
110.7 |
113.6 |
95.0 |
91.7 |
81.1 |
53.7 |
45.2 |
62.0 |
67.7 |
64.4 |
45.4 |
40.4 |
59.2 |
31.6 |
19.9 |
18.5 |
18.5 |
Cu Concentrate Grade |
% |
26.4% |
-- |
-- |
-- |
28.3% |
28.4% |
27.6% |
27.1% |
26.5% |
26.1% |
26.0% |
25.4% |
25.1% |
25.2% |
25.2% |
25.6% |
25.5% |
25.2% |
26.1% |
25.6% |
26.4% |
25.9% |
23.7% |
Au Payable |
koz |
370 |
-- |
-- |
-- |
28 |
42 |
34 |
35 |
29 |
29 |
25 |
16 |
12 |
19 |
20 |
19 |
13 |
11 |
16 |
9 |
5 |
4 |
4 |
Fe Payable |
Mt |
68.4 |
-- |
-- |
-- |
1.3 |
3.7 |
4.1 |
4.4 |
4.5 |
4.3 |
3.8 |
4.3 |
4.5 |
4.2 |
2.7 |
2.5 |
3.4 |
2.8 |
1.9 |
2.8 |
4.3 |
4.4 |
4.4 |
Fe Concentrate Grade |
% |
65.4% |
-- |
-- |
-- |
62.5% |
65.0% |
66.2% |
66.6% |
66.4% |
65.6% |
65.6% |
65.6% |
66.2% |
66.2% |
65.4% |
64.4% |
65.4% |
65.0% |
63.5% |
64.2% |
64.6% |
65.0% |
65.6% |
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Copper Revenue |
$M |
|
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Revenue |
$M |
|
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Magnetite concentrate revenue |
$M |
|
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Revenue |
$M |
|
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mine Operating Costs |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Mill Processing Costs |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
G&A Costs |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Refining Charges, Treatment Charges, Transportation Cost & Royalties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Refining |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Treatment Costs |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Transport Costs |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Storage & Marketing |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Insurance Charges |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Royalties |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Cost Guarantee |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Guarantee |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
-- |
-- |
Other Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income |
$M |
|
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-- |
-- |
-- |
-- |
EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA |
$M |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Streams Proceeds |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remaining Gold Streams Proceeds |
$M |
|
|
|
|
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
Capital Expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$M |
( |
( |
( |
( |
( |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
Sustaining Capital |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Deferred Stripping |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
-- |
-- |
Closure Cost |
$M |
( |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
Change in Working Capital |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in Working Capital |
$M |
-- |
-- |
-- |
-- |
( |
( |
|
( |
|
( |
|
( |
( |
( |
|
|
( |
|
( |
|
( |
|
|
Pre-Tax Unlevered Free Cash Flow |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-Tax Unlevered Free Cash Flow |
$M |
|
( |
( |
( |
( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-Tax Cumulative Unlevered Free Cash Flow |
$M |
|
( |
( |
( |
( |
( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unlevered Cash Taxes |
$M |
( |
-- |
-- |
-- |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
( |
Post-Tax Unlevered Free Cash Flow |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Post-Tax Unlevered Free Cash Flow |
$M |
|
( |
( |
( |
( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Post-Tax Cumulative Unlevered Free Cash Flow |
$M |
|
( |
( |
( |
( |
( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost KPI's |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
C1 (by-product basis)* |
$/lb Cu |
|
-- |
-- |
-- |
|
|
|
|
( |
|
|
( |
( |
|
|
|
|
|
|
|
|
( |
( |
C1 (co-product basis)** |
$/lb Cu Eq. |
|
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*C1 consist of mining costs, processing costs, mine-level G&A, gold revenue credit, and refining charges over payable copper equivalent pounds (copper plus magnetite)
** C1 consist of mining costs, processing costs, mine-level G&A, gold revenue credit, magnetite revenue credit, and refining charges over payable copper pounds
PRICE DECK & MARKETING ASSUMPTIONS |
||
Assumption |
Unit |
LOM |
Copper Price |
$/lb |
|
Gold Price |
$/oz |
|
62% grade magnetite Conc. Price (CFR China) |
$/t |
|
65% grade magnetite Conc. Price (CFR China) |
$/t |
|
67% grade magnetite Conc. Price (CFR China) |
$/t |
|
Freight Charge ( |
$/t |
|
Chilean Peso |
CLP/USD |
800:1 |
Copper Treatment Charges |
$/dmt |
|
Copper Refining Charges |
$/lb Cu |
|
Gold refining charge |
$/oz |
|
Exhibit 2: Sierra Norte, Historical Mineral Resources
Category |
Tonnes (Mt) |
CuT % |
CuS % |
Copper (kt) |
Carmen-Paulina |
||||
Measured |
7.5 |
0.47% |
0.16% |
35.5 |
Indicated |
63.5 |
0.46% |
0.10% |
292.0 |
Inferred |
25.1 |
0.40% |
0.04% |
101.5 |
Total |
96.1 |
0.45% |
0.09% |
429.0 |
|
|
|
|
|
Esther |
|
|
|
|
Measured |
0.7 |
0.42% |
0.26% |
3.0 |
Indicated |
3.3 |
0.40% |
0.24% |
13.3 |
Inferred |
0.1 |
0.35% |
0.22% |
0.3 |
Total |
4.1 |
0.40% |
0.24% |
16.6 |
Notes:
The Historical Mineral Resource was derived from the report “Actualización del Modelo Geológico y de la Estimación de Recursos Minerales del Proyecto Diego de Almagro” completed by Amec Foster Wheeler with an effective date on
View source version on businesswire.com: https://www.businesswire.com/news/home/20240731222196/en/
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jannett@capstonecopper.com
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Source: