FIRST QUANTUM MINERALS REPORTS FOURTH QUARTER AND YEAR-END 2022 RESULTS (In United States dollars, except where noted otherwise)
NEWS RELEASE
23-09
February 14, 2023
www.first-quantum.com
FIRST QUANTUM MINERALS REPORTS FOURTH QUARTER
AND YEAR-END 2022 RESULTS
(In United States dollars, except where noted otherwise)
Toronto, Ontario (February 14, 2023) - First Quantum Minerals Ltd. (“First Quantum” or “the Company”) (TSX: FM)
today reports results for the three months ended December 31, 2022 (“Q4 2022”) of net earnings attributable to
shareholders of the Company of $117 million ($0.17 earnings per share) and adjusted earnings1 of $151 million ($0.22
adjusted earnings per share 2). For the year -ended 2022, the Company reported net earnings attributable to
shareholders of the Company of $1,034 million ($1.50 per share) and adjusted earnings1 of $1,064 million ($1.54 per
share1).
“2022 can be summarized as a challenging year for First Quantum and the mining industry as a whole. The year was
characterized by volatile commodity prices and rising costs and interest rates, creating a challenging macroeconomic
environment. We remain focused on driving consistent operational performance, successful execution of our
brownfield projects and discipline with our ca pital investments. Debt reduction continues to be a priority,”
commented Tristan Pascall, Chief Executive Officer. “I am grateful for the dedication of the entire team at First
Quantum. It is with these efforts that First Quantum was able to navigate through the challenges in 2022.”
Q4 2022 SUMMARY
In Q4 2022, First Quantum reported gross profit of $361 million, EBITDA 1 of $647 million, net earnings attributable
to shareholders of $0.17 per share, and adjusted earnings of $0.22 per share 2. Relative to the t hird quarter (“Q3
2022”), fourth quarter financial results benefitted from higher realized metal prices3, partially offset by lower gold
sales volumes.
Total copper production for the fourth quarter was 206,007 tonnes, a 6% increase from Q3 2022. The quar ter-over-
quarter increase in production was attributable to Kansanshi and Sentinel, with grades improving at both operations.
Production at Kansanshi showed improvement following an enhanced water management strategy and access to
higher grade ore.
Copper C1 cash cost2 of $1.86 per lb for Q4 2022 was $0.04 per lb higher than Q3 2022. The increase in costs were
primarily related to higher maintenance activities and lower by-product credits. During the fourth quarter of 2022,
input prices and operational costs have broadly stabilized, albeit at elevated levels, following inflationary pressures
throughout the first three quarters of the year. There is a lag before such market changes flow through to unit costs.
Three-year guidance on production, C1 cash costs2, all-in sustaining cost (“AISC”)1 and capital expenditures that was
previously disclosed on January 16, 2023 remains unchanged. For 2023, copper production is forecast to be 770,000
to 840,000 tonnes while copper C1 cash costs1 are guided to be $1.65 to $1.85 per lb. Capital cost guidance for 2023
is $1,600 million.
1 EBITDA and adjusted earnings are non-GAAP financial measures. These measures do not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures di sclosed by other issuers. Adjusted earnings and EBITDA were previously named comparative earnings and comparative EBITDA, res pectively, and the
composition remains the same. See “Regulatory Disclosures”.
2 Adjusted earnings per share, copper C1 cash cost (copper C1), and all-in sustaining cost (AISC) are non-GAAP ratios which do not have a standardized meaning prescribed by IFRS
and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Realized metal prices are a non-GAAP ratio, do not have standardized meanings under IFRS and might not be comparable to similar financial measures disclosed by other issuers.
See “Regulatory Disclosures” for further information.
First Quantum Minerals Ltd. 23-09
Page 2 of 15
Q4 2022 OPERATIONAL HIGHLIGHTS
Total copper production for Q4 2022 was 206,007 tonnes, up from the 194,974 tonnes reported in Q3 2022, as
Kansanshi and Sentinel reported higher production and Cobre Panamá continued to achieve strong quarterly
production. Copper sales volumes in Q4 2022 totaled 198,912 tonnes, approximately 7,000 tonnes lower than
production during the quarter due to timing of shipments.
Copper C1 cash cost 1 averaged $1.86 per lb in Q4 2022, up from $1.82 per lb in Q3 2022. Copper C1 cash cost 1 at
Kansanshi and Sentinel improved relative to Q3 2022 due to higher copper production.
Cobre Panamá produced 89,652 tonnes of copper in Q4 2022, a 2% decrease over production levels in the
previous quarter due to lower throughput as grades and recoveries remained consistent with Q3 2022 levels.
During the quarter, 21.9 million tonnes of ore was processed, including a record volume of 8.3 million tonnes
in December. Copper C1 cash cost1 of $1.63 per lb was $0.20 per lb higher than the previous quarter due to
higher labour costs and e xposure to spot electricity prices in Q4 2022. Unit 2 of the power plant at Cobre
Panamá had a scheduled biennial maintenance shutdown in October, with replacement electrical power
sourced from the national grid at spot prices. A collar structure for coal purchases is currently in place with
the ceiling price already exercised from July 2021 onwards, thereby limiting exposure to further increases in
the coal price until the end of 2023.
Kansanshi’s copper production of 34,802 tonnes in Q4 2022 was 4,940 to nnes higher than the previous
quarter on grade improvement. Feed grades to all three circuits increased from the third quarter mainly due
to deployment changes made during the second half of the year. This resulted in an enhanced water
management strategy in M12, which led to a more consistent feed grade to the mixed and oxide circuits.
Deployment changes in M17 also resulted in de -risking the plan by balancing the mixed ore feed between
strata and ore associated with narrow-veins, which had a positive impact on feed grade consistency. Sulphide
feed grades improved as mining took place in areas with mainly strata mineralization. Work is continuing on
reconciliations and the learnings are incorporated in the near -term mine plans to further improve and
optimize sequences. Copper C1 cash cost1 of $2.81 per lb was $0.12 lower than Q3 2022 mainly due to higher
production volumes from improved grades.
Sentinel reported copper production of 73,409 tonnes in Q4 2022, 9,289 tonnes higher than the previous
quarter as grade, in particular, and throughput improved in the fourth quarter, despite experiencing heavy
rainfall in December. The operation achieved record quarterly throughput benefitting from the treatment of
soft, well-fragmented ore and the performance of the f ourth in-pit crusher. Copper C1 cash cost 1 of $1.55
per lb was $0.22 per lb lower than the preceding quarter reflecting improved production volumes.
Ravensthorpe payable nickel production of 4,450 tonnes was 510 tonnes lower than the third quarter.
Beneficiation and HPAL availability remained stable, however, there was a planned autoclave descale
shutdown in October. Nickel C1 cash cost1 was $9.32 per lb, a $0.20 per lb increase over the previous quarter.
While fuel, labour, and sulphur prices declined in the fourth quarter, higher nickel C1 cash cost1 resulted from
lower production levels and lower payabilities.
1 C1 cash costs (C1) is a non-GAAP ratios which do not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by
other issuers. See “Regulatory Disclosures”.
First Quantum Minerals Ltd. 23-09
Page 3 of 15
FINANCIAL HIGHLIGHTS
Gross profit of $361 million and EBITDA 1 of $647 million for the fourth quarter were 20% and 11% higher,
respectively, than Q3 2022 with the increase mainly attributable to improved metal prices.
Cash flows from operating2 activities of $237 million ($0.34 per share) for the quarter were $288 million lower
than Q3 2022 mainly due to working capital movements related to trade and other receivables.
Net debt1 increased by $363 million during the quarter, taking the net debt 1 balance to $5,692 million as at
December 31, 2022. As at December 31, 2022, total debt was $7,380 million (September 30, 2022, total debt
was $7,118 million). The increase in net debt and total debt is mainly attributable to working capital
movements and $195 million dividend paid to non-controlling interests. The Company continues to target a
further $1 billion reduction in debt in the medium term.
The Company announced that it intends issue a notice of partial redemption on February 15, 2023 for $450
million of its outstanding 6.5% Senior Notes due March 2024 to be redeemed on February 25, 2023.
On February 14, 2023, the Company declared a final dividend of CDN$0.13 per share, in respect of the
financial year ended December 31, 2022. The final dividend together with the interim dividend of CDN$0.16
per share declared on July 26, 2022 amount to a total of CDN$0.29 per share for the 2022 financial year. The
dividend will be paid on May 8, 2023 to shareholders of record on April 17, 2023.
BROWNFIELD PROJECTS
The CP100 Expansion project at Cobre Panamá is in early operation with the new process water circuits and bypass
feeders in use, with the balance of the expansion scope in ore commissioning with ore having been introduced to
both Ball Mill 6 and the primary screening facility. Ramp up of production is in progress to achieve a throughput rate
of 100 Mtpa by the end of 2023.
At the S3 Expansion, detail design is progressing well and incorporates enhancements and efficiencies introduced by
the latest generation of preferred equipment and the learnings of the Sentinel and Cobre Panamá operations. Long-
lead mining fleet and long -lead process plant equipment have been ordered with deliveries commencing in the
second half of 2023. Overall project procurement is ap proximately 25% committed. Across the three -year guidance
period provided on January 16, 2023, project capital expenditures for the S3 Expansion project is expected to be
approximately $900 million, with the majority of the spend to occur over 2023 and 202 4. Total capital expenditure
for the S3 Expansion project remains unchanged at $1.25 billion.
Enterprise remains on schedule for first ore in the first half of 2023. In parallel, mine facilities are being developed,
including the satellite administration o ffice, workshop, fuel storage, haul road upgrade, dewatering boreholes and
other facilities. Plant refurbishment, completion and commissioning activities remain on schedule.
1 EBITDA is a non-GAAP financial measures and net debt is a supplementary financial measure. These measures do not have a standardized meaning prescribed by IFRS and might
not be comparable to similar financial measures disclosed by other issuers. EBITDA was previously comparative EBITDA and the composition remains the same. Se e “Regulatory
Disclosures”.
2 Cash flows from operating activities per share is a non-GAAP ratio which do es not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
First Quantum Minerals Ltd. 23-09
Page 4 of 15
QUARTERLY FULL YEAR
Q4 2022 Q3 2022 Q4 2021 2022 2021
Copper production (tonnes)1 206,007 194,974 201,823 775,859 816,435
Cobre Panamá 89,652 91,671 80,030 350,438 331,000
Kansanshi 34,802 29,862 51,939 146,282 202,159
Sentinel 73,409 64,120 60,197 242,451 232,688
Other Sites 8,144 9,321 9,657 36,688 50,588
Copper sales (tonnes) 198,912 198,980 213,087 782,236 821,889
Cobre Panamá 85,330 92,665 86,112 343,448 341,078
Kansanshi2 32,496 37,305 59,872 159,007 195,327
Sentinel 71,642 60,058 58,087 241,162 232,812
Other Sites 9,444 8,952 9,016 38,619 52,672
Gold production (ounces) 70,493 67,417 74,945 283,226 312,492
Gold sales (ounces)3 59,568 65,014 79,403 270,775 321,858
Nickel production (contained tonnes) 5,705 5,849 3,385 21,529 16,818
Nickel sales (contained tonnes) 6,840 5,992 3,756 20,074 17,078
Cash cost of copper production (C1) (per lb)4,5 $1.86 $1.82 $1.39 $1.76 $1.30
Total cost of copper production (C3) (per lb) 4,5 $2.79 $2.75 $2.39 $2.73 $2.23
Copper all-in sustaining cost (AISC) (per lb) 4,5 $2.42 $2.34 $2.05 $2.35 $1.88
1 Production is presented on a contained basis, and is presented prior to processing through the Kansanshi smelter.
2 Sales include third-party sales of concentrate, cathode and anode attributable to Kansanshi (excluding copper anode sales attributable to Trident). Sales exclude the sale of copper
anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate purchases were 8,651 and 13,379 tonnes for
the three and twelve months ended December 31, 2022, (nil for the three and twelve months ended December 31, 2021).
3 Excludes refinery-backed gold credits purchased and delivered under the precious metal streaming arrangement (see “Precious Metal Stream Arrangement”).
4 Copper all-in sustaining cost (copper AISC), copper C1 cash cost (copper C1), and total cost of copper (copper C3) are non-GAAP ratios, which do not have a standardized meaning
prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disc losures”.
5 Excludes the sale of copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third -party concentrate purchases were
8,651 tonnes and 13,379 tonnes for the three and twelve months ended December 31, 2022 (nil for the three and twelve months ended December 31, 2021).
QUARTERLY FULL YEAR
Q4 2022 Q3 2022 Q4 2021 2022 2021
Average LME copper cash price (per lb) $3.63 $3.51 $4.40 $3.99 $4.23
Realized copper price1 (per lb) $3.56 $3.43 $4.08 $3.90 $3.64
Treatment/refining charges (“TC/RC”) (per lb) ($0.12) ($0.12) ($0.11) ($0.13) ($0.12)
Freight charges (per lb) ($0.04) ($0.03) ($0.03) ($0.03) ($0.03)
Net realized copper price1 (per lb) $3.40 $3.28 $3.94 $3.74 $3.49
Average LBMA cash price (per oz) $1,728 $1,729 $1,795 $1,800 $1,799
Net realized gold price1,2 (per oz) $1,574 $1,546 $1,677 $1,665 $1,673
Average LME nickel cash price $11.47 $10.01 $8.99 $11.61 $8.39
Net realized nickel price1,3 $13.67 $9.76 $8.88 $11.93 $8.05
1 Realized metal prices are a non-GAAP ratio, do not have standardized meanings under IFRS and might not be comparable to similar financial measures disclosed by other issuers.
See “Regulatory Disclosures” for further information.
2 Excludes gold revenues recognized under the precious metal stream arrangement.
3 The premium to the average LME cash price arose from the timings of sales across the periods, their respective quotation pric ing periods and the impact from the Company’s
decision to temporarily suspend its nickel hedging program following the failure of the LME nickel platform in March 2023.
First Quantum Minerals Ltd. 23-09
Page 5 of 15
QUARTERLY FULL YEAR
Q4 2022 Q3 2022 Q4 2021 2022 2021
Sales revenues 1,832 1,727 2,061 7,626 7,212
Gross profit 361 302 784 2,200 2,562
Net earnings attributable to shareholders of the
Company
117 113 247 1,034 832
Basic earnings per share $0.17 $0.16 $0.36 $1.50 $1.21
Diluted earnings per share $0.17 $0.16 $0.36 $1.49 $1.20
Cash flows from operating activities 237 525 760 2,332 2,885
Net debt1 5,692 5,329 6,053 5,692 6,053
EBITDA2,3 647 583 1,085 3,316 3,684
Adjusted earnings3 151 96 306 1,064 826
Adjusted earnings per share4 $0.22 $0.14 $0.44 $1.54 $1.20
Realized copper price (per lb)4 $3.56 $3.43 $4.08 $3.90 $3.64
Net earnings attributable to shareholders of the
Company
117 113 247 1,034 832
Adjustments attributable to shareholders of the
Company:
Adjustment for expected phasing of Zambian
value-added tax (“VAT”) receipts 56 6 (2) 190 16
Loss on redemption of debt – – 21 – 21
Total adjustments to EBITDA2 excluding
depreciation3
6 (26) 49 (155) (88)
Tax and minority interest adjustments (28) 3 (9) (5) 45
Adjusted earnings2 151 96 306 1,064 826
1 Net debt is a supplementary financial measure which does not have a standardized meaning under IFRS, and might not be comparable to similar financial measures disclosed by
other issuers. See “Regulatory Disclosures.
2 EBITDA and adjusted earnings are non-GAAP financial measures, which do not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. Adjusted earnings and EBITDA were previously named comparative earnings and comparative EBITDA, r espectively, and the composition remains the
same. Adjusted earnings have been adjusted to exclude items from the corresponding IFRS measure, net earnings attributable to shareholders of the Company, which are not
considered by management to be reflective of underlying performance. The Company has disclosed these measures to assist with the understanding of results and to provide
further financial information about the results to investors and may not be comparable to similar financial measures disclose d by other issuers. The use of adjusted earnings and
EBITDA represents the Company’s adjusted earnings metrics. See “Regulatory Disclosures”.
3 Adjustments to EBITDA in 2022 relate principally to foreign exchange revaluations and non-recurring costs relating to previously sold assets (2021 - foreign exchange revaluations).
4 Adjusted earnings per share and realized metal prices are non-GAAP ratios which do not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
First Quantum Minerals Ltd. 23-09
Page 6 of 15
COBRE PANAMÁ UPDATE
The Company and the Government of Panamá (“GOP”) have been in discussions surrounding a refreshed concession
contract for the Cobre Panamá mine (see the Management’s Discussion and Analysis for the three months and year-
ended December 31, 2022 for additional disclosure). In July 2021, the current GOP, established a multidisciplinary
commission including the Minister of Commerce and Industrie s (“MICI”), Minister of Environment, and Minister of
Employment to seek resolution on a refreshed contract.
On December 21, 2022, Minera Panamá, S.A. (“MPSA”) received formal notification from MICI of a resolution requiring
MPSA to submit a plan within 10 working days to suspend commercial operations at Cobre Panamá and put the
mine under “care and maintenance.” As required by the GOP, MPSA is working on a plan for how to operate Cobre
Panamá under care and maintenance. At the same time, the Company is pursuing every available legal recourse to
avoid this outcome. Due to the legal processes and the GOP’s role in responding to the plan, the timing and impact
of this requirement remain uncertain.
On January 26, 2023, the Panamá Maritime Authority (“AMP”) issued a resolution that required the suspension of
concentrate loading operations at the Cobre Panamá port, Punta Rincón (the “Port”), until evidence was provided
that the process of certification of the calibration of the scales by an accredited company had been initiated. MPSA
filed legal proceedings to challenge the resolution, staying its legal effects. Nevertheless, the Company submitted
the required proof of the initiation of the certificatio n process on February 2, 2023, and, on February 7, 2023, the
Company submitted certifications of the calibration of the scales and weights. AMP rejected the certification on
February 8, 2023, claiming that the certification company is not accredited in Pan amá, even though the provider
MPSA used is on the list of accredited companies published by MICI. MPSA is challenging this decision and, at the
same time, is working to find another accredited certification company that the GOP will accept. In the meantime ,
the AMP has maintained its order suspending loading operations at the Port. In addition, since at least January 24,
2023, the AMP has issued individual letters to the Company’s maritime pilot service providers instructing them not
to provide services to incoming vessels for loading copper concentrate at the Port.
MPSA is pursuing all available avenues to restart shipments at the Port , including all legal recourse available ,
engagement with other accredited and accreditable expert companies and continuous communications with the pilot
services suppliers. As previously reported, if AMP’s measures persist, it may become necessary to shut down the
Cobre Panamá mine if concentrate is not shipped by approximately February 20, 2023 due to limited storage capacity
on site.
The Company has indicated to the GOP that it is prepared to accept and pay a minimum of $375 million per year to
the GOP, comprised of corporate taxes and a profit -based mineral royalty of 12 to 16 percent, with downside
protections. The parties continue to finalize the details behind these principles, including the appropriate mechanisms
that would achieve the desired outcome. This includes the stability of the tax and royalty regime and reasonable
protections against early termination.
The Company continues to engage in good faith discussions with the GOP and remains ready to reach an agreement
that is fair and equitable to both parties. Once an agreement is concluded and the full contract is documented, it is
expected that the newly drafted legislation would be put to the Panamanian National Assembly for approval.
NULLITY ACTIONS BY THIRD PARTIES
In December 2016, the Concession Contract held by MPSA was extended for a second 20 -year term (from March 1,
2017). In 2018, two third parties filed ac tions in the Supreme Court seeking a declaration that the extension was
illegal and therefore, null and void (the “Nullity Actions”).
The Company refutes the claims made in the Nullity Actions and has been advised by external counsel that the
extension process followed by the MICI in 2016 was correct. In connection with those proceedings, the Procurador
de la Administración (“Administration’s Attorney”) issued formal opinions in 2018 and 2019 stating that the Extension
Resolution was legal. However, during January 2023, the Administration’s Attorney changed the previous position
taken and filed motions in both Nullity Actions asking that the Extension resolution be deemed without legal effect.
MPSA has filed an opposition against the Administration’s Attorney’s motions. The Supreme Court has not yet ruled
on the matter.
First Quantum Minerals Ltd. 23-09
Page 7 of 15
ARBITRATION PROCEEDINGS
MPSA has initiated arbitration processes under the existing Concession Contract and the Canada-Panamá Free Trade
Agreement. Both of these processes are under way and in the initial stages.
ZAMBIAN POWER SUPPLY
Water levels at the Kariba Dam reached a record low at the end of 2022. In January 2023, ZESCO requested that the
Company’s Zambian operations reduce its power usage for a two -week period due to the lower water l evels at the
Kariba Dam and planned maintenance at the 300 megawatt Maamba power plant. During the period, Kansanshi and
Sentinel conducted planned maintenance that was previously scheduled for February and March. Although the
country is experiencing load -shedding, there is no major impact on the Zambian mining operations. Heavier than
normal rains have been experienced in the current rainy season which sho uld replenish the Kariba basin from April
2023 onwards.
ZAMBIAN TAX REGIME
On September 30, 2022, the Minister of Finance and National Planning presented the 2023 National Budget. The key
enacted changes affecting the mining industry include the restructuring of the Mineral Royalty Tax Regime and the
reinstatement of taxes and import duty on fuel.
The restructuring of the Mineral Royalty tax was enacted on January 1, 2023 and includes an amendment to the
calculation of mineral royalty tax to be on an incremental basis. In addition, an amendment to the mineral royalty tax
bands determining the mineral royalty tax rate applicable at various price levels were made, as shown below.
Price
($ per tonne) Previous Rates
Price
($ per tonne)
Revised Rates
as of January 1, 2023
0 – 4,499 5.5% 0 – 4,000 4.0%
4,500 – 5,999 6.5% 4,001– 5,000 6.5%
6,000 – 7,499 7.5% 5,001– 7,000 8.5%
7,500 – 8,999 8.5% 7,001+ 10.0%
9,000+ 10.0%
The reinstatement of taxes and duties on fuel, which were suspended in January 2021, includes the reinstatement of
excise duties and standard-rated VAT became effective from October 1, 2022. In addition, effective January 1, 2023,
import duties on fuel (previously at a rate of 25%) were reinstated with a corresponding red uction in the rate of the
import duties from 25% to ‘free’, resulting in nil impact of the reinstatement of these duties.
KANSANSHI – CONVERSION OF ZCCM DIVIDEND RIGHTS TO ROYALTY RIGHTS
During the fourth quarter of 2022, an agreement was entered into betw een the Company’s subsidiary Kansanshi
Mining Plc (“KMP”) and its partner ZCCM Investments Holdings Plc (“ZCCM-IH“) to convert ZCCM-IH’s dividend rights
in KMP into royalty rights . A dividend of $195 million was paid to ZCCM -IH on the signing of this agree ment. Post
completion, this transaction also provides for 20% of the KMP VAT refunds as at June 30, 2022 to be paid to ZCCM -
IH, as and when these are received by KMP from the Zambian Revenue Authority (“ZRA”). Completion of this
transaction is expected during the first half of 2023.
First Quantum Minerals Ltd. 23-09
Page 8 of 15
2023 to 2025 GUIDANCE UPDATE
Three-year guidance on production, C1 cash costs1, AISC1 and capital expenditures that was previously disclosed on
January 16, 2023 remains unchanged. For 2023, copper production is forecast to be 770,000 to 840,000 tonnes while
copper C1 cash costs1 are guided to be $1.65 to $1.85 per lb. Capital cost guidance for 2023 is $1,600 million.
Cobre Panamá is expected to produce 350,000 to 380,000 tonnes of copper and 140,000 to 160,000 ounces of gold
in 2023. Production for 2023 includes commissioning of the CP100 Expansion in the first quarter of 2023 with a ramp-
up over the course of the year to achieve an annualized throughput rate of 100 Mtpa by the end of 2023. For 2023
as a whole, grades and recoveries are expected to be consistent with 2022 levels but will fluctuate from quarter to
quarter. At this time, the timing and impact of any care and maintenance regime enacted by the MICI or any shutdown
following receipt of the Resolution issued by the AMP remain uncertain. Given this, production and unit cost guidance
for Cobre Panamá is based on normal operations with no disruption to production.
At Kansanshi, production in 2023 is expected to range from 130,000 to 150,000 tonnes of copper and 95,0 00 to
105,000 ounces of gold. Copper production in 2023 and 2024 reflects similar levels as 2022 with lower oxide grades
and sulphide grades while mining vein -hoisted areas. Copper and gold production in 2025 includes some limited
production associated with the S3 Expansion, expected to commence in the second half of 2025.
At Sentinel, copper production in 2023 is expected to be between 260,000 and 280,000 tonnes. The operation has
experienced particularly heavy rains in January, which has impacted mining operations and the sequence of mining.
As a result, copper production is expected to be below the quarterly average in the first quarter. A 5-day maintenance
shutdown is planned for the third quarter.
Nickel production in 2023 is expected to be 28,000 to 3 8,000 tonnes, comprised of 23,000 to 28,000 tonnes from
Ravensthorpe and 5,000 to 10,000 tonnes from Enterprise. Nickel production at Enterprise is expected to commence
in the first half of 2023 with ramp up to full plant throughput and recovery in 2024. Production guidance in 2023 for
Enterprise includes 5,000 tonnes of pre-commercial production results.
Copper C1 cash cost 1 guidance for 2023 is $1.65 to $1.85 per lb, while AISC 1 cash cost guidance 1 is $2.25 to $2.45
per lb. For the 2023 to 2025 guidance period, C1 cash cost 1 guidance for both copper and nickel assumes a gold
price of between $1,700 and $1,750 per ounce, average Brent crude oil price of $100 per barrel and a Zambian
Kwacha/US dollar exchange rate of 16. A coal price of $150 per tonne is as sumed for 2024 and 2025. Ravensthorpe
unit cost guidance is based on a sulphur price of $150 per tonne.
Project capital in the three-year guidance period includes:
Expenditures for the S3 Expansion project of approximately $900 million, with the majority of the spend to
occur over 2023 and 2024,
Pre-strip activities for the South East Dome pit of $300 million,
Additional capital expenditures at Kansanshi, including the expansion of the tailings facility and smelter, of
approximately $300 million,
$650 million in capital expenditures at Cobre Panamá for the development of the Colina pit, work on the
West Dam, purchase of additional mining fleet, expansion of camp facilities and assembly of the
molybdenum flotation and filtration plant,
$200 million in cap ital expenditures at Sentinel for the relocation of in -pit crusher 2 and the purchase of
additional mining equipment, and;
$35 million for the completion of the Enterprise nickel project.
1 C1 cash cost (C1), and all -in sustaining cost (AISC) are non -GAAP ratios, and do not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.