Guidance & Outlook

This page contains non-GAAP measures and forward-looking information about expected future events and financial and operating performance of the Company. All dollar amounts are expressed in U.S. dollars, unless otherwise noted.

2022 - 2024 Production Guidance & Outlook1

(metal contained in concentrate)

 

2022 Cash Cost Guidance3

Candelaria’s cash costs are expected to approximate $1.55/lb2 copper in 2022, similar to 2021 levels, after by-product credits. 

At Chapada, cash costs are expected to approximate $1.60/lb5 copper in 2022 after significant gold by-product credits. Effects of copper stream agreements are reflected in the realized copper revenue. 

Eagle is expected to maintain the first quartile cash costs of negative $0.25/lb nickel in 2022, considering significant by-product copper credits.

At Neves-Corvo, cash costs for 2022 are expected to improve year-on-year to approximate $1.80/lb6 copper, after zinc and lead by-product credits. The forecast decrease in cash costs is primarily due to increased zinc production volumes.

Zinkgruvan’s cash costs for 2022 are expected to approximate $0.55/lb6 zinc after copper and lead by-product credits.

 

2022 Capital Expenditure Guidance7

Additionally, post-closing of acquisition, Lundin Mining intends to spend up to $300 million to advance the Josemaria project ahead of a construction decision in the second half of 2022, including engineering, commitments for long lead items, preconstruction activities and drilling.

 

2022 Exploration Expenditure Guidance

Exploration expenditures are planned to be $45 million in 2022. Approximately $40 million is to be spent supporting significant in-mine and near-mine targets at our operations ($15 million at Candelaria, $10 million at Chapada, $8 million at Neves-Corvo, $5 million at Zinkgruvan and $2 million at Eagle). The remaining $5 million is planned to advance activities on exploration stage and new business development projects.

 

1. Production guidance is based on certain estimates and assumptions, including but not limited to: Mineral Resources and Mineral Reserves, geological formations, grade and continuity of deposits and metallurgical characteristics.

2.  68% of Candelaria’s total gold and silver production are subject to a streaming agreement.

3. Cash costs are a non-GAAP measure. Please also see the Management’s Discussion and Analysis for the year ended December 31, 2021 and for the three months ended March 31, 2022, for discussion of non-GAAP measures and other performance measures. 2022 cash costs are based on various assumptions and estimates, including, but not limited to: production volumes, as noted above, commodity prices (2022 - copper $3.90/lb, zinc $1.15/lb, lead $0.90/lb, and gold $1,800/oz) foreign currency exchange rates (2022- €/USD:1.20, USD/SEK:8.20, CLP/USD:700, USD/BRL:5.10) and operating costs. 

4. 68% of Candelaria’s total gold and silver production are subject to a streaming agreement and as such cash costs are calculated based on receipt of $420/oz and $4.20/oz, respectively, on gold and silver sales in the year. No consideration has been made for the upfront payment received in the calculation of cash costs.

5. Chapada cash costs are calculated on a by-product basis and do not include the effects of copper stream agreements. Effects of copper stream agreements are reflected in copper revenue and will impact realized revenue per pound.  

6. Silver production at Zinkgruvan and Neves-Corvo are also subject to streaming agreements. 

7.  Sustaining capital is a supplementary financial measure. Please also see the Management’s Discussion and Analysis for the year ended December 31, 2021 and three months ended March 31, 2022, for discussion of non-GAAP measures and other performance measures. Forecast capital expenditures have been reported on a cash basis. Discrepancies may exist with other external reports which have been reported on an accrual basis.