2012 Capital Expenditure Guidance
Capital expenditures for 2012 are expected to be $410 million (2011 - guidance $290 million) which includes:
- Sustaining capital in European operations: $95 million (2011 - $100 million). The modest decrease is related to slightly lower sustaining capital expenditures at Neves‐Corvo for the year ahead.
- New investment capex in European operations: $65 million (2011 ‐ $70 million), consisting of:
- Lombador Phase One ($40 million) including underground development, final SAG mill delivery payments, and other critical path items. Lombador Phase One underground work is proceeding on schedule and the main access ramp has reached approximately 800m below surface. It is expected to reach 900 meters depth by the second quarter of 2012 to facilitate the development of an exploration drive to allow for further underground exploration of the Lombador deposits.
- Neves-Corvo dam ($13 million) related to tailings and water storage capacity increases
- Other plant improvements and debottlenecking ($12 million) at both Neves-Corvo and Zinkgruvan
- New Investment in Tenke: We have assumed the Phase II expansion at Tenke to be completed by 2013, and we contemplate our share of expansion funding and sustaining capital funding to be up to $250 million for next year. The capital spending, if prices remain strong, is expected to be cash neutral to the Company as Tenke operating cash flows should be sufficient.
