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Introduction – the Trident Project TSX: FM LSE: FQM LuSE: FQMZ

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Presentation on theme: "Introduction – the Trident Project TSX: FM LSE: FQM LuSE: FQMZ"— Presentation transcript:

1 Introduction – the Trident Project TSX: FM LSE: FQM LuSE: FQMZ
January 2014 TSX: FM LSE: FQM LuSE: FQMZ

2 Trident Project location

3 About the Trident Project
US$1.8-billion investment Located in the Solwezi District of Northwestern Province, Zambia Approximately 150km from Solwezi on the T5 main road to Mwinilunga Comprises five prospecting large scale licences A number of attractive base metal prospects including the Sentinel deposit and the Enterprise deposit 5 x large-scale mining licences awarded 20 April 2011 for 25 years tenure EIA approved 8 July 2011 and Addendum 12 August 2013 Resettlement Action Plan approved 15 October 2013

4 TRIDENT project layout

5 Sentinel MINE IN CONSTRUCTION – commissioning MID 2014
Updated resource published May 2012: 514 boreholes for 172,692m defined an NI resource of: Total measured & indicated : 0.51% Cu Inferred : 0.42% Cu Cut-off : 0.2% Cu Mineral Reserve: % Cu Proved : % Cu Probable : %Cu. Strip ratio 2.2 : 1 Mine planning: Grade of 0.5% Cu requires a high throughput of 55 Mtpa to achieve production target of 280 – 300,000t Cu per annum. Sentinel will put Zambia at the forefront of global mining technology

6 Enterprise MINE IN APPROVAL – EARLY WORKS UNDERWAY
Maiden resource published December 2012: 359 boreholes for 116,000m defined an NI resource of: Total measured indicated : 1.07% Ni Inferred : 0.70% Ni Cutoff : 0.15% Ni Mineral Reserve: % Ni Further potential to expand Mineral Resource and Reserve on the Enterprise South West Zone Mine planning: Resource confirms potential for an operation producing on average 38,000 Ni per annum with scope to increase to 60,000t Ni per annum EIA under application Enterprise to share infrastructure with Sentinel

7 SENTINEL MINE UNDER CONSTRUCTION

8 ABOUT THE SENTINEL MINE – Project Scope
55Mtpa target throughput 3 semi mobile in pit crushers and assembly of large scale mining equipment Largest operating SAG/Ball mill trains in the world (100MW milling power) 265,000t of freight = 14,500 truckloads of materials 2 rivers to be dammed/diverted Life of mine TSF 600km of ZESCO 330kV power transmission lines Lumwana – Kalumbila – Lusaka West 690 staff houses plus 590 houses in resettlement Development of a new town, airport, clinic, school etc…. Zambia’s largest single development project in recent times

9 PROGRESS PHOTOS – SENTINEL PLANT AREA
Here are some photos of the site, which you will see closer in a moment. First the main plant area. AERIAL PHOTO 31-DEC-2013

10 CONSTRUCTION PROGRESS – END DEC 2013
PROJECT BASELINE SCHEDULE CREATED ON JULY 2012 OVERALL PROGRESS ACTUAL = % PLAN = % Construction progress is running very well and we are very close to our projected schedule. The main area which is reducing cumulative progress is the powerline which we are pushing very hard with our partners ZESCO. 2012 2013 2014 May12 Jun12 Jul12 Aug12 Sep12 Oct12 Nov12 Dec12 Jan13 Feb13 Mar13 Apr13 May13 Jun13 Jul13 Aug13 Sep13 Oct13 Nov13 Dec13 Jan14 Feb14 Mar14 Apr14 May14 Jun14 Jul14 Aug14 Sep14

11 Filipinos / Indonesians
Employment – END DEC 2013 Department Local Expat Filipinos / Indonesians TOTAL Infrastructure 524 11 105 640 FQML Plant 688 26 412 / 144 1270 Operations and Support 526 30 - 556 FQMO Roads 670 15 685 Subcontractors 1456 115 1571 Overall Manpower 3,864 197 661 4,722 Percentage (%) 82% 4% 14% 100% We are employing over 3000 people on the project currently of which 80% are local Zambians. We have around 670 Filipinos and Indonesians on the site. These are very hard workers and have good trade skills. The Filipinos and Indonesians are training the local Zambian workforce. They fit in very well with the local Zambians and we do not have any friction between them. Safety record at 31 Dec 2013 : The project had recorded a total of five lost time incidents at 13,415,504 man-hours completed. LTI frequency rate was 0.060

12 3 x ROPE SHOVELs - 1,350t, 57m3 bucket
The mine fleet will be very large to deliver the high volumes to the plant. Here are the 3 x rope shovels which will extract mainly waste material from the mine. You can just see a man standing at the top gantry in this picture.

13 3 x PCX5500 LOADers - 205t, 21m3 bucket
Here are the large excavator / face shovels responsible mainly for moving ore to the plant.

14 36 x TRUCKS – 21 x 960E + 15 x 860E (*) (*) Final numbers subject to confirmation The large trucks will hold 330 tonnes, and the smaller trucks will hold 250 tonnes. We have chosen the fleet to suit the availability of tyres from the market.

15 IN PIT CRUSH – 3 x (ThyssenKrupp) 63-89 20MTPA
Sentinel mine will use in pit crushers, cut down into the mine, to process the ore. Because the haul trucks need to transport less vertical distance, this will save diesel and costs. The in pit crushers will be transported to new positions every 5 years approximately.

16 100MW Milling – 2 x 40’SAG + 2 x 28’BALL
Sentinel requires around 100MW of milling power to grind the ore feed to the plant. The process plant will have the largest currently operating SAG/Ball mill trains in the world.

17 PROGRESS PHOTOS – PLANT AREA
MILL BUILDINGS 31-DEC-2013 FLOTATION AREA 31-DEC-2013 STOCKPILE VAULT 20-JAN-2014 CONVEYOR LINE 21-JAN-2014

18 PROGRESS PHOTOS – PLANT AREA
CABLE PULLING 31-DEC-2013 ROUGHER FLOTATION 31-DEC-2013 CLEANER FLOTATION 2-JAN-2014 TAILS THICKENER 31-DEC-2013

19 PROGRESS PHOTOS – PLANT AREA
REAGENTS, DEPRESSANTS AREA & PIPERACK LINE 31-DEC-2013 CONCENTRATE STORAGE BUILDING 31-DEC-2013 CRUSHER ASSEMBLY YARD 31-DEC-2013 CAT EQUIPMENT ASSEMBLY YARD 31-DEC-2013

20 PROGRESS PHOTOS – MINE AREA
MSA, RUBBER TYRE WORKSHOP 31-DEC-2013 MSA, KOMATSU ASSEMBLY YARD 31-DEC-2013 MINING EQUIPMENT AT BOX CUT 2-JAN-2014 NORTHWEST BOXCUT AERIAL PHOTO 01-DEC-2013

21 PROGRESS PHOTOS – INFRASTRUCTURE
CHISOLA DAM INLET 20-JAN-2014 CHISOLA DAM, OUTLET PIPE & TUNNEL 2-JAN-2014 RAW WATER LINE 2-JAN-2014 33KV SITE POWER 02-SEPT-2013

22 Power line development connecting the west of Zambia

23 upgrades to ZESCO NETWORK

24 ZESCO POWER INFRASTRUCTURE PROJECT
First Quantum commitments to ZESCO grid upgrades: First Quantum to upfront finance and has contracted : 68km Lumwana – Kalumbila 330kV transmission line + substations; 400km Kalumbila – Mumbwa 330kV transmission line; 145km Mumbwa – Lusaka West 330kV transmission line; Upgrades to Kansanshi substation. ZESCO (ADB & EIB finance) will contract : Lusaka West + Mumbwa switchyards. ZESCO KANSANSHI SUBSTATION WORKS 20-JAN-2014

25 1. Lumwana – kalumbila line (68km) single circuit 330kv

26 PROGRESS PHOTOS – ZESCO SUBSTATION AT SENTINEL
SWITCHYARD, EAST GANTRY FOOTINGS 01-NOV-2013 SWITCHYARD 1-NOV-2013 POWERLINE CLEARING & EARTHWORKS 20-DEC-2013 SWITCHYARD 30-DEC-2013

27 2. Lusaka West – kalumbila line (545km) DOUBLE CIRCUIT 330Kv

28 TOWN DEVELOPMENT UPFRONT INVESTMENT IN THE COMMUNITY

29 About the New Town Located in the Solwezi District of Northwestern Province, Zambia : Approximately 150km from Solwezi on the T5 main road to Mwinilunga At the heart of the ‘New Copperbelt’ Proper planning and services for 10,000 homes Town plan approved by Solwezi Council on 7 March 2012 EIA approved by ZEMA on 12 August 2013 Town name must be chosen and approved by Government Vision Statement Kalumbila town to grow into one of the best new towns in Zambia, if not Africa.

30 Expertly Designed & FULLY SERVICED TOWN
Town design by Zambian and international firms. Water, sewerage and waste 11 Jul 2012 – MOU signed with NWW Weekly waste collection Metered electrical reticulation 31 Jan 2013 – Contracts signed with NWEC 28 Nov 2012 – ZESCO agreement signed Roads: First Quantum construction – RDA Paved roads with street lights and separate bike paths & sidewalks Clinics, schools, police station and recreation.

31 MFEZ to encourage local businesses
Application to ZDA for MFEZ status: Substantial tax incentives to businesses setting up in the area: 0% tax for first 5 years, next 3 years at 50%, next 2 years at 75%; 0% tax on dividends for a period of 5 years; 0% import duties on raw materials, capital goods, machinery for 5 years; Deferment of VAT on machinery and equipment. Further the MFEZ will facilitate increased home ownership: 0% VAT on home purchase, passed through to the homeowner. The MFEZ provides no direct benefit to the mine – rather it stands to encourage local and international businesses to develop in the town. This is good for local procurement and regional development. And will generate its own multiplier employment for beyond the life of mine.

32 Worker housing – for home ownership
RESETTLEMENT and livelihood program Upcoming works Block plant part assembled awaiting the arrival of the Chinese engineer for commissioning Materials procurement well underway to avoid annual December slowdown in RSA First building contractor (Merkaba – 300 x 3bed small houses) onsite at risk. Contract complete 9 October. Risks to execution EIA not yet approved – expected this month (advertised by ZEMA) Monitoring of stock levels critical to maintain material flows Lack of skilled local labour could impact on the programme Wet Season – need to get as many platforms in place and good road drainage prior to November Transport strike in RSA could impact deliveries – apparently now resolved

33 PROGRESS PHOTOS – SENIOR HOUSING
SPORTS FACILITY 04-NOV-2013 SENIOR HOUSING - SINGLES 31-MAR-2013 SENIOR HOUSING AREA 28-FEB-2013 TRIDENT PREP SCHOOL 05-NOV-2013

34 PROGRESS PHOTOS – AFFORDABLE HOUSING
AFFORDABLE HOUSING LAYOUT TEACHER’S HOME 3-JAN-2014 The affordable housing area, where our employees will own their home. Again you can see how we have tried to minimise the trees lost for construction. TRUST SCHOOL 05-NOV-2013 COMPLETED 4-BEDROOM HOUSE 3-JAN-2014

35 BLOCK PLANT – LOCAL FABRICATION
We make all our own blocks on site for housing construction – around 5,000 per day DESIGN BUILDER SIZE (m2) NUMBER (units) AVE COST (US$) Type A : 4bed Self-perform 175 50 $91,875 Type B : 3bed large 102 200 $51,000 Type C : 3bed small Merkaba 65 300 $32,014 Type D : 2bed Thor (Tom Van Vuuren) 46 $24,150 TOTAL 600 $23M 35

36 Csr & Entitlements ZMK-millions Upfront commitment Annual commitment
TOTAL after first 2 years Area entitlements & livelihood support Entitlements & compensation/resettlement package 57.6 - Livelihood support – Conservation Farming & other programmes 3.7 7.4 Community health & infrastructure Construction of schools, clinics, police station & other buildings 22.8 0.4 23.6 Community health programmes 4.6 2.8 10.2 Solwezi District General Hospital renovations 11.0 Value addition & conservation Sawmill – installations & employment 10.0 2.4 14.8 Conservation programmes – game & forest management 2.0 0.8 3.6 TOTAL CSR & ENTITLEMENTS 108.0 10.1 128.2 ZMK 108-billion will be spent upfront at Trident on social projects and entitlements to the benefit of the Kalumbila community including building of school, health and police facilities and the refurbishment of the Solwezi General Hospital which services the District. First Quantum has also constructed a licenced sawmill, to provide value addition to otherwise waste timber, which already employs more than 100 local staff; ZMK 10-billion is committed each year on upkeep of the social investments at Trident and extension into livelihood support to the Kalumbila community; In addition to these committed budgets, First Quantum is investing a further ZMK billion in the upfront development of a new town at Kalumbila including construction of an initial 600 affordable houses for Zambian staff. First Quantum has also committed substantial expenditure to its environmental compliance programs at Trident; The local procurement programme continues to expand at Trident since the first local contract was signed in January 2012. In addition First Quantum has already invested more than ZMK 16.5-billion in training systems to develop future workers at the Sentinel mine.

37 Community projects – underway

38 PROGRESS PHOTOS – RESETTLEMENT
RESETTLEMENT HOUSES RESETTLEMENT HOUSES Here are photos of community buildings for the resettlement project. I believe Garth Lappeman – who is our Resettlement and Community Engagement Manager will give you some more details later on our community projects. Thank you for your attention. I will stop here and ask for questions. RESETTLEMENT SCHOOL RESETTLEMENT CLINIC

39 PROGRESS PHOTOS – CSR MALARIA SCREENING 01-DEC-2014
Here are photos of community buildings for the resettlement project. I believe Garth Lappeman – who is our Resettlement and Community Engagement Manager will give you some more details later on our community projects. Thank you for your attention. I will stop here and ask for questions. LIVELIHOOD SUPPORT 01-DEC-2014 LIVELIHOOD SUPPORT MOSQUITO SPRAYING


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