Lundin Mining Exercises Option to Increase Ownership in Caserones to 70% and Receives Commitments to Increase the Term Loan by $350 Million
The consideration for the Call Option Exercise will be paid for in cash and will consist of a payment of
As part of the shareholders' agreement with JX,
The purchase price of
Caserones' production guidance for 2024 is 120,000 – 130,000 tonnes of copper and 2,500 - 3,000 tonnes of molybdenum on a 100% basis. Annual production guidance for Caserones on a 100% basis for both 2025 and 2026 is 125,000 - 135,000 tonnes of copper. Cash cost2 for 2024 is forecast to be
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1 Previously named JX Metals Corporation. |
2
This is a non-GAAP measure. For equivalent historical non-GAAP financial measure comparatives see the Historical Non-GAAP Measure Comparatives section of this press release. Please also see the Management's Discussion and Analysis for the period ended |
Capital expenditures for the year are forecast to total
Highlights:
-
Enhances copper production profile: Increases
Lundin Mining's 2024 attributable copper production. This will further solidifyLundin Mining's position as a meaningful copper producer globally. - Immediate free cash flow contribution: Attractive acquisition price that is accretive to attributable production and financial metrics.
- Optimization opportunities: The Company is expected to realize significant additional operational improvements over the next six to eight months from optimization efforts currently underway.
-
Exploration potential: Caserones comes with a highly prospective mineral property package.
Lundin Mining believes significant exploration potential exists near the mine and regionally. Since the acquisition, the Company has added additional copper Proven and Probable Mineral Reserves at Caserones which will contribute to a longer mine life, as per the news release datedFebruary 8, 2024 "Lundin Mining Announces 2023 Mineral Resource and Mineral Reserve Estimates". - Emerging Vicuña District: Caserones is in the Vicuña District, an emerging world-class copper belt that also hosts the Josemaria development project, together this region represents a key growth opportunity for the Company.
About
The information in this release is subject to the disclosure requirements of
Technical Information
The Qualified Person responsible for the scientific and technical information contained herein is
Reconciliation of Non-GAAP Measures
The Company uses certain performance measures in its analysis. These performance measures have no standardized meaning within generally accepted accounting principles under International Financial Reporting Standards and, therefore, amounts presented may not be comparable to similar data presented by other mining companies. For additional details please refer to the Company's discussion of non-GAAP and other performance measures in its Management's Discussion and Analysis for the three months ended
Cash Cost per Pound and All-in Sustaining Costs per pound can be reconciled to Production Costs on the Company's Condensed Interim Consolidated Statement of Earnings as follows:
|
Three months ended
|
|
|
||||
Operations |
Candelaria |
Caserones |
Chapada |
Eagle |
Neves-Corvo |
Zinkgruvan |
|
($000s, unless otherwise noted) |
(Cu) |
(Cu) |
(Cu) |
(Ni) |
(Cu) |
(Zn) |
Total |
Sales volumes (Contained metal): |
|
|
|
|
|
||
Tonnes |
33,536 |
35,211 |
8,742 |
2,163 |
5,886 |
15,825 |
|
Pounds (000s) |
73,934 |
77,627 |
19,273 |
4,769 |
12,976 |
34,888 |
|
Production costs |
|
|
|
|
|
|
567,134 |
Less: Royalties and other |
|
|
|
|
|
|
(19,970) |
|
|
|
|
|
|
|
547,164 |
Deduct: By-product credits |
|
|
|
|
|
(165,308) |
|
Add: Treatment and refining charges
|
|
|
|
|
|
46,951 |
|
Cash cost |
139,490 |
166,439 |
38,735 |
19,249 |
42,057 |
22,837 |
428,807 |
Cash cost per pound |
1.89 |
2.14 |
2.01 |
4.04 |
3.24 |
0.65 |
|
Add: Sustaining capital |
99,532 |
42,754 |
29,199 |
4,078 |
22,413 |
14,341 |
|
Royalties |
2,968 |
8,814 |
1,617 |
2,678 |
735 |
— |
|
Reclamation and |
2,167 |
1,040 |
2,679 |
1,968 |
1,335 |
1,186 |
|
Leases & other |
3,033 |
15,381 |
765 |
1,236 |
64 |
78 |
|
All-in sustaining cost |
247,190 |
234,428 |
72,995 |
29,209 |
66,604 |
38,442 |
|
AISC per pound ($/lb) |
3.34 |
3.02 |
3.79 |
6.12 |
5.13 |
1.10 |
|
|
Twelve months ended
|
|
|
|
||||||
Operations |
Candelaria |
Caserones1 |
Chapada |
Eagle |
Neves-Corvo |
Zinkgruvan |
|
|||
($000s, unless otherwise noted) |
(Cu) |
(Cu) |
(Cu) |
(Ni) |
(Cu) |
(Zn) |
Total |
|||
Sales volumes (Contained metal): |
|
|
|
|
|
|
||||
Tonnes |
144,473 |
66,075 |
43,761 |
13,339 |
32,054 |
65,344 |
|
|||
Pounds (000s) |
318,508 |
145,670 |
96,476 |
29,407 |
70,667 |
144,059 |
|
|||
Production costs |
|
|
|
|
|
|
2,086,108 |
|||
Less: Royalties and other |
|
|
|
|
|
|
(66,237) |
|||
Inventory fair value adjustment
|
|
|
|
|
|
(39,945) |
||||
|
|
|
|
|
|
|
1,979,926 |
|||
Deduct: By-product credits |
|
|
|
|
|
|
(699,915) |
|||
Add: Treatment and refining charges
|
|
|
|
|
|
183,328 |
||||
Cash cost |
660,160 |
290,553 |
219,278 |
63,457 |
167,424 |
62,467 |
1,463,339 |
|||
Cash cost per pound |
2.07 |
1.99 |
2.27 |
2.16 |
2.37 |
0.43 |
|
|||
Add: Sustaining capital |
380,112 |
83,880 |
72,291 |
22,201 |
102,621 |
53,358 |
|
|||
Royalties |
— |
15,820 |
8,568 |
22,994 |
3,949 |
— |
|
|||
Reclamation and other closure accretion and depreciation |
9,258 |
2,560 |
7,836 |
11,331 |
5,387 |
3,744 |
|
|||
Leases & other |
13,325 |
47,944 |
4,999 |
4,100 |
553 |
427 |
|
|||
All-in sustaining cost |
1,062,855 |
440,757 |
312,972 |
124,083 |
279,934 |
119,996 |
|
|||
AISC per pound ($/lb) |
3.34 |
3.03 |
3.24 |
4.22 |
3.96 |
0.83 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
1 Caserones results are from |
Cautionary Statement on Forward-Looking Information
Certain of the statements made and information contained herein is "forward-looking information" within the meaning of applicable Canadian securities laws. All statements other than statements of historical facts included in this document constitute forward-looking information, including but not limited to statements regarding the Company's plans, prospects and business strategies; the Company's guidance on the timing and amount of future production and its expectations regarding the results of operations; expected costs; permitting requirements and timelines; timing and possible outcome of pending litigation; the results of any Preliminary Economic Assessment, Feasibility Study, or Mineral Resource and Mineral Reserve estimations, life of mine estimates, and mine and mine closure plans; anticipated market prices of metals, currency exchange rates, and interest rates; the development and implementation of the Company's Responsible Mining Management System; the Company's ability to comply with contractual and permitting or other regulatory requirements; anticipated exploration and development activities at the Company's projects; the Company's integration of acquisitions and any anticipated benefits thereof; and expectations for other economic, business, and/or competitive factors. Words such as "believe", "expect", "anticipate", "contemplate", "target", "plan", "goal", "aim", "intend", "continue", "budget", "estimate", "may", "will", "can", "could", "should", "schedule" and similar expressions identify forward-looking statements.
Forward-looking information is necessarily based upon various estimates and assumptions including, without limitation, the expectations and beliefs of management, including that the Company can access financing, appropriate equipment and sufficient labour; assumed and future price of copper, nickel, zinc, gold and other metals; anticipated costs; ability to achieve goals; the prompt and effective integration of acquisitions; that the political environment in which the Company operates will continue to support the development and operation of mining projects; and assumptions related to the factors set forth below. While these factors and assumptions are considered reasonable by
All of the forward-looking statements made in this document are qualified by these cautionary statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated, forecast or intended and readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which may have been used. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking information. Accordingly, there can be no assurance that forward-looking information will prove to be accurate and forward-looking information is not a guarantee of future performance. Readers are advised not to place undue reliance on forward-looking information. The forward-looking information contained herein speaks only as of the date of this document. The Company disclaims any intention or obligation to update or revise forward–looking information or to explain any material difference between such and subsequent actual events, except as required by applicable law.
SOURCE