The New Leader in Global Copper June, 2013
Cautionary Note Regarding Forward-Looking Statement 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, anticipates 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 2
Strong Q1 2013 Results Despite Lower Year-Over-Year Metal Prices Copper production 20% higher Nickel production of 11,072 tonnes; record quarterly production from Ravensthorpe Gold production 32% higher Copper production cash costs lower by 4% Gross profit 15% higher US$ millions Q1 2013 Q1 2012 Change Revenues 901.2 728.7 24% Comparative earnings per share $0.32 $0.25 28% Cash flow after working capital changes 416.4 138.5 201% Cash 1,857.6 1,026.6 81% 3
A Significant Step Forward in Our Growth & Diversification Strategy Australia 19% Europe 8% Australia 10% Africa 36% Europe 10% Africa 71% Americas 92% Americas 45% Europe 9% 1 Mtpa 1 300 Ktpa 1 1.3 Mtpa 1 2018E Copper production. Source: BrookHunt 4
Geographically Diversified Portfolio of High-Quality Operations & Projects 5
High-Quality, Stable Operations 6
High-Quality, Stable Operations Kansanshi Cu-Au mine, Zambia Located near Solwezi in the north western Province of Zambia First production in 2005 Open pit mining Flexible ore treatment to allow for variation in ore type : sulphide circuit; oxide circuit; gold facility Near mine resource definition and exploration programs Workforce = ~1,700 7
High-Quality, Stable Operations Kansanshi Cu-Au mine, Zambia Multi-phase production expansion project underway 2012 2015 60% increase in overall production capacity 2012 2014 130% increase in oxide production capacity 2014-2015 90% increase in sulphide production capacity Expansion Project Capacity Completion Estimate Cost (US$M) Production Impact Oxide 7.2 mtpa Complete 31 Copper: 10,000-15,000 tpa Oxide 14.5 mtpa 2013-2014 200 Copper: 60,000-75,000 tpa Smelter 1.2 mtpa 2014 650 Smelter Acid 1.0 Mtpa @ $40-$50/tonne Sulphide 25 mtpa 2015 565 Copper: 60,000-70,000 tpa 8
High-Quality, Stable Operations Guelb Moghrein Cu-Au mine, Mauritania 100% ownership Located 250 kilometres northeast of the nation s capital, Nouakchott As at December 31, 2012, the estimated minelife was ~nine years (including stockpiles) based on current operations First production in 2006 Workforce = ~1,470 9
High-Quality, Stable Operations Guelb Moghrein Cu-Au mine, Mauritania Stronger, more sustained performance over the past 12 months Focused on improving plant availability Evaluating potential to recover magnetite as a by-product Deposit considered to be an IOCG type deposit - structure and mineralogy has common features with other IOCG deposits elsewhere in the world 10
High-Quality, Stable Operations Ravensthorpe Ni mine, Australia Acquired as a decommissioned plant in 2010 First production within 20 months of purchase Estimated mine life of 32 years Commercial production declared Dec 28 2011 Workforce = ~405 Q1 12 performance 9,023 tonnes of contained nickel C1 cash cost of US$5.36/payable lb. 11
High-Quality, Stable Operations Kevitsa Ni-Cu-PGE mine, Finland Built, commissioned and started commercial operations within 36 months of board approval Estimated mine life of 29 years Commercial production declared August 2012 Workforce = ~290 Further potential Process optimization Approval to increase throughput to a maximum of 10Mtpa from 5.5Mtpa 12
High-Quality, Stable Operations Las Cruces Cu mine, Spain Acquired in March 2013 Estimated mine life of 9 years with potential for an additional 10 to 15 years Average grade of 5.4% copper Workforce = 250 direct employees; 650 contractors Annual production capacity 72,000 tonnes of copper cathode Q1 13 cash cost of US$1.00/lb. 13
High-Quality, Stable Operations Çayeli Cu-Zn mine, Turkey Acquired in March 2013 Estimated mine life of 6 years with potential for an additional 3 years Average grade of 3.1% copper and 3.6% zinc Workforce = 493 employees Q1 C1 cash cost of US$0.93/lb. copper 2013 Estimates: 28,000 31,000 tonnes of copper 36,000 40,000 tonnes of zinc 14
High-Quality, Stable Operations Pyhäsalmi Cu-Zn mine, Finland Acquired in March 2013 One of the most efficient underground mines in the world Estimated mine life of 6 years Average grade of 1.1% copper and 1.9% zinc Workforce = 261 employees Q1 C1 cash cost of (US$0.55)/lb. copper 2013 Estimates: 12,000 13,000 tonnes of copper 20,000 23,000 tonnes of zinc 15
Outlook for 2013 Production Copper (000 s tonnes) Nickel (000 s contained tonnes) Gold (000 s ounces) Zinc (000 s tonnes) Group 384-416 40-45 193-213 41-48 Kansanshi 250-270 - 126-140 - Guelb Moghrein 37-41 - 56-61 - Ravensthorpe - 31-35 - - Kevitsa 15-16 9-10 11-12 - Çayeli 1 21-24 - - 27-31 Las Cruces 1 53-56 - - - Pyhäsalmi 1 8-9 - - 14-17 Unit cash cost Copper (US$/lb.) Nickel (US$/lb.) Group $1.40 - $1.50 $5.50 - $6.00 Capital expenditure Excluding Cobre Panama $2.0 billion 1 The production guidance shown above for Çayeli, Las Cruces and Pyhäsalmi represents guidance from acquisition date of March 22, 2013 until the end of the year. 16
Our Project Pipeline 17
Our Project Pipeline Copper Smelter, Zambia Processing capacity of 1.2 Mtpa 71% Sentinel 100% Kansanshi Average copper grade 26% Blister copper production 300,000 tpa; acid production 1.0 Mtpa Estimates: Capital cost of US$650M Operating cost US$69/tonne of concentrate Commissioning from mid 2014 Estimated savings: US$340M - US$510M/year 18
Our Project Pipeline 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 US$2.0 billion capex Annual production up to 300,000 tonnes 19
Our Project Pipeline Cobre Panama Cu project, Panama Acquired March 2013 Large open pit copper project Larger project than the Panama Canal Major aspect in our acquisition decision Est. mine life of 40 years Est. average annual production of 260,000 tonnes copper Speeding up access to site 20
Our Project Pipeline Haquira Cu project, Peru Focused on community & environmental aspects Potential: - 20 year mine life Avg 190k tonnes of copper production per year 21
One of the Few Mining Companies Investing in Building Capacity
Metals & Mining Capital Expenditure Has Peaked (US$ MM) 90,000 Capital Expenditure by Major Mining Companies 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 -- 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E Source: Company information, CapIQ Note: Includes Anglo American, BHP Billiton, Glencore Xstrata, Rio Tinto and Vale 23
Junior Miners Struggling to Access Capital Troubled Financing Landscape Has Created a Funding Gap for Junior Mining Companies IPO Proceeds (US$ Bn) 25 20 40-50% reductions in new issues and follow-on proceeds providing little support for Juniors from the equity markets Volume (Deals) 300 250 200 15 150 10 100 5 50 -- 2007 2008 2009 2010 2011 2012 Proceeds Volume -- Source: Ernst & Young Metals and Mining Outlook 2013 24
Focus on Capital Structure, Not Capital Spending Two-tier market: the largest borrowing large; the rest borrowing little or not at all Over 50% of proceeds used to restructure existing lending Bond Proceeds (US$ Bn) 120 100 Proceeds Volume 80 60 40 20 -- 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: Ernst & Young Metals and Mining Outlook 2013 Syndicated Loan Volume (2000-2012) (US$ Bn) Refinancing Volume (Deals) 200 160 120 80 40 -- 59 Only a small fraction of proceeds are used to fund growth projects Corporate Purposes Working Capital Acquisition Finance Capital Expenditure Project Finance Debtor in Possesion 1 5 8 10 12 25 -- 20 40 60 Source: Ernst & Young Metals and Mining Outlook 2013 25
First Quantum: Success Through Project Development We spend a disproportionally high amount on growth projects 70% 60% 50% 40% Capital Expenditure as a Percentage of Revenue (2005-2013) First Quantum Copper Peers Majors This approach has been a key driver behind our success as a company by providing the basis for our superior track record of production growth and shareholder returns Building on this track record, we have increased and accelerated our development projects 30% 20% 10% -- Source: CapIQ (ktpa) 1,200 1,000 800 600 400 2005 2006 2007 2008 2009 2010 2011 2012 2013 Kansanshi 2004 Copper Production (Total) Guelb Moghrein 2006 Frontier 2007 Kevitsa 2012 Ravensthorpe 2011 Sentinel Kansanshi Expansion and Smelter Cobre Panama Haquira Enterprise 200 Bwana Lonshi 2001 -- 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Source: CapIQ 26
Total Annualized Shareholder Return January 2000 March 2013 First Quantum Southern Copper Antofagasta Vale BHP Billiton Vedanta Lundin Teck Freeport Rio Tinto HudBay Anglo American Eramet SA Norilsk Kazakhmys ENRC Glencore (21%) (15%) (5%) 16% 15% 13% 12% 11% 9% 7% 5% 5% 3% 27% 23% 22% 33% Source: CapIQ 27 8
Freeport-McMoRan Glencore Xstrata Codelco First Quantum BHP Billiton Southern Copper Rio Tinto Anglo American KGHM Kazakhmys Teck Resources Vale Antofagasta Norilsk First Quantum 2012 Leading Copper Growth 1.8 2018E Copper Production, Mt 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 Source: BrookHunt 28
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 29
The New Leader in Global Copper June, 2013