CERRO LINDO SILVER STREAM CORNERSTONE ASSET December 2016

Transcription

1 CERRO LINDO SILVER STREAM CORNERSTONE ASSET December 2016

2 Largest Underground Polymetallic Mine in Peru Cerro Lindo is a Zn/Cu/Pb/Ag VMS deposit, wholly-owned and operated by Milpo, a subsidiary of Votorantim Metais Holding Cerro Lindo is one of the ten largest zinc mines in the world Largest Peruvian underground mine through a successful history of low-cost staged expansions Excellent track record of reserve replacement and life extension Low-cost, long-life mine Modern, best-in-class operation including use of seawater through a desalination plant and drystack tailings disposal Strong labor/community relations Excellent potential for life extension and expansions through continued exploration Cerro Lindo Processing Plant 2

3 Attributes to Triple Flag Foundational Asset Cornerstone stream providing immediate cash flow Low second quartile cash cost US$0.51/lb Zn in 2015 Annual average silver streamed of 1.7 to 2.2 Moz Largest underground polymetallic mine in Peru - a mining-friendly jurisdiction Strong Partners and Counterparties Ideal long-term partners Milpo is a proven local operator with track record of capacity expansions More than 67 years of operations in Peru and, since 2010, a partnership with Votorantim Metais Holding, the largest non-ferrous metals company in Brazil Votorantim Group is a 98-year-old leading, highly successful multigenerational private Brazilian conglomerate Conservative capital structures and low leverage Growth strategy to expand production Optionality Robust geological, exploration and expansion potential VMS deposit with attractive exploration potential Track record of reserve replenishment Increasing exploration spend 3

4 Transaction Overview Key Stream Terms Upfront Payment Ongoing Payment Stream Rate US$250 million 10% of spot silver 65% of payable silver until 19.5Moz delivered, 25% of payable silver thereafter Reference Silver Payable silver in concentrate from Cerro Lindo Stream Area 1 Future Optionality Triple Flag has a right of first refusal over any future streams on Cerro Lindo Area of Interest 2 Desalination Plant (1) Stream Area includes the entire existing Cerro Lindo mine and infrastructure, all located south of the Topará river. (2) Triple Flag has a ROFR over any future streams on the Stream Area including any future developments north of the Topará river. 4

5 Milpo s Flagship Mine Located ~240km from Lima in the District of Chavin (at 1,820masl) Sub-level open stope mining 18 ktpd flotation producing Zn, Cu and Pb concentrates, with current expansion to 20 ktpd (1) Staged growth strategy with commissioning in 2007 at 5 ktpd and three subsequent expansions to current capacity of 18 ktpd in 2014 Milpo s flagship asset, comprising 65% of segment revenue in Q1 Q First mine in Peru to use desalinated seawater piping water 60 km from the Pacific Ocean to the mine Award-winning dry-stack tailings facility with ample remaining capacity (1) Silver reports to copper and lead concentrates 5

6 Track Record of Production Capacity Expansion Milpo has an excellent track record of increasing production capacity incrementally without impacting the existing operations, resulting in steadily increasing production. Currently expanding to 20 ktpd. 6

7 Production Cerro Lindo Silver Stream Excellent Operating Track Record Operating History Reserve Replacement (Mt) Mt Annual Treated Ore (Mt) Zinc (kt) Copper (kt) Lead (kt) Silver (Moz) Cash Cost (US$/t ROM) $29.3 $29.2 $32.5 $ Milpo has a remarkable operating history Milpo has increased reserves each year despite depletion 2008 Reserves Replacement Depletion '09 - '

8 Low Second Quartile Mine Cash Costs in 2015 Consistently low cash costs and well-placed amongst zinc peers on the cash cost curve Source : Wood Mackenzie and Milpo (1) Represents C1 cash costs which reflect direct cash costs of producing metal incorporating mining, processing and offsite realization costs having made appropriate allowance for the co-product revenue streams. 8

9 Thank You 9

10 Thank You 10