Guidance & Outlook

2018 - 2020 Production Guidance & Outlook1

(tonnes of metal contained in concentrate)

 

 

2018 Cash Cost Guidance2

At Candelaria, estimated C1 cash costs are expected to approximate $1.70/lb copper after by-product credits. By-product credits have been adjusted for the terms of the streaming agreement but exclude any allocation of upfront cash received.

Eagle's estimated C1 cash costs are expected to approximate $1.10/lb nickel after by-product credits, primarily copper as well as cobalt and precious metals. Eagle cash costs are to remain well positioned in the lowest quartile of the global nickel producer cost curve.

At Neves-Corvo, estimated C1 cash costs for 2018 are expected to approximate $1.20/lb copper after zinc and lead by-product credits.

Zinkgruvan's estimated C1 cash costs are expected to approximate $0.45/lb zinc after copper and lead by-product credits. Zinkgruvan is expected to remain a low cost zinc producer for the foreseeable future.

 

2018 Capital Expenditure Guidance4

 

2018 Exploration Expenditure Guidance

Exploration expenditures are planned to be $83 million in 2018. Approximately $70 million will be spent on in-mine and near-mine targets: $34 million at Candelaria, $18 million at Eagle, $13 million at Zinkgruvan and $5 million at Neves-Corvo. The remainder earmarked to advance exploration activities for new South American and Eastern European exploration 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 C1 cash costs are based on various assumptions and estimates, including, but not limited to; production volumes, as noted above, commodity prices (2018 - Cu: $3.00/lb, Zn: $1.40/lb, Pb: $1.00/lb, Ni: $6.00/lb) foreign currency exchange rates (2018 - €/USD:1.25, USD/SEK:8.50, CLP/USD:600) and operating costs. All figures in are in US$ unless otherwise noted.

3 68% of Candelaria's total gold and silver production are subject to a streaming agreement and as such C1 cash costs are calculated based on receipt of $404/oz and $4/oz, respectively, on gold and silver sales in the year. No consideration has been made for the upfront payment received in the calculation of C1 cash costs.

4 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.

Lundin Mining Corporation

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