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1Boliden – Capital Markets Day 5 April 2005
Exploration- the true R&D of Mining
Svante Nilsson, President Mining Operation
Mining Smeltingand
Refining
Zinc Copper
Boliden – Capital Markets Day 5 April 2005 2
Agenda
• Some basics about exploration and ore reserves.
• Goal and strategy
• Present status of reserves and resources.
• Case study Garpenberg / lappberget
• Case study Kristineberg / J-zone
3Boliden – Capital Markets Day 5 April 2005
Boliden´s Value Chain
Exploration
Recycling
Mining Smelting & Refining
Copper
Zinc
Precious metals
Boliden – Capital Markets Day 5 April 2005 4
Strategy to increase Ore Reserves
Balanced portfolio of
Field Exploration-Field Exploration Boliden
-Joint Ventures
-Juniors
Business Development-Joint Ventures
-Partnership
-M&A
Mine-site Exploration-Close to all existing mines
-Infrastructure in place
-Shorter lead times
Boliden – Capital Markets Day 5 April 2005 5
Ore reserve v.s. Mineral Resource
The Jorc Code“An Ore Reserve is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified.”
Boliden – Capital Markets Day 5 April 2005 6
Ore Reserves and Mineral Resources
EXPLORATIONINFORMATION
MINERAL MINERAL RESOURCES RESERVES
INFERREDIncreasing
level ofgeologicalknowledge INDICATED PROBABLE
andconfidence
MEASURED PROVEN
Consideration of mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors
The "modifying factors"
Good historical track record
Boliden – Capital Markets Day 5 April 2005 7
Increasing metal price / Decreasing production cost / New technique
Relation between tonnage – ore value – metal price – production –new technique
Decreasing metal price / Increasing production cost
900 m level
Infrastructure
Boliden – Capital Markets Day 5 April 2005 8
Exploration goals
• Skellefte-field• > 20 Mton reserves /resources 2005-2008• two additional discoveries within 4 years• > 5-10 Mton by mine site exploration
• Aitik• Mine site exploration to increase production
• Garpenperg• > 10 Mton reserves and > 25 resources 2005-2008• Additional discoveries within 4 years
• Tara• > 15 Mton resources 2005-2008
Boliden – Capital Markets Day 5 April 2005 9
Exploration strategy 2005
• Focus mine-site exploration
• Field exploration in the Skellefteå-field for base metals and gold
• JV with Inmet Mining in the Bergslagen district
• Feasibility study: increased Copper exploration in Norrbotten
Boliden – Capital Markets Day 5 April 2005 10
Exploration expenses
0
50
100
150
200
250
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
MSEK
Boliden – Capital Markets Day 5 April 2005 11
TaraResource & Reserve Development
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
20000
1998 1999 2000 2001 2002 2003 2004 2005
Year
Kto
nnas
InferredMeasured&IndicatedProven&ProbableProduction
Boliden – Capital Markets Day 5 April 2005 12
AitikResource & Reserve Development
0
100000
200000
300000
400000
500000
600000
700000
800000
900000
1000000
1998 1999 2000 2001 2002 2003 2004 2005Year
Kto
nnes
InferredMeasured&IndicatedProven&ProbableProduction
Boliden – Capital Markets Day 5 April 2005 13
GarpenbergResource & Reserve Development
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
1998 1999 2000 2001 2002 2003 2004 2005Year
Kto
nnes
InferredMeasured&IndicatedProven&ProbableProduction Ktonnes
Boliden – Capital Markets Day 5 April 2005 14
Boliden AreaResource & Reserve Development
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
1998 1999 2000 2001 2002 2003 2004 2005Year
Kto
nnes
InferredMeasured&IndicatedProven&ProbableProduction
Production includes Storliden and smelter slagg
Boliden – Capital Markets Day 5 April 2005
Production history from 29 mines in the Skellefte District 1925-2003
0
500 000
1 000 000
1 500 000
2 000 000
2 500 000
1924
1926
1928
1930
1932
1934
1936
1938
1940
1942
1944
1946
1948
1950
1952
1954
1956
1958
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
Tonnes/year
Adak Lindsköld Brännmyran Rudtjebäcken Lainijaur BolidenLångsele Långdal Kankberg Åkulla V Åkulla Ö ÅkerbergBjurfors Högkulla Ö Holmtjärn Kristineberg Rävlidmyran RävlidenKimheden Hornträsk Näsliden Rakkejaur Renström Petiknäs SUdden Åsen Kedträsk Maurliden Storliden
Production: In total 99 million tonnes of ore
Boliden – Capital Markets Day 5 April 2005 16
Ore Reserves & Mineral Resources
• Aitik – Ore Reseves > 12 years– Excellent Mineral Resources – Potential for production increse in a 10-year perspective
• Boliden – Limited Ore Reserves– Improving resources– Potential to maintain current production level in a 10-year perspective
• Garpenberg – Improving Ore Reserve– Excellent Mineral Resource position– Potential for production increase in a 10-year perspective
• Tara – Ore Reserves > 6 years – Good Mineral Resource inventory– Potential to maintain current production level in a 10 year perspective
Boliden – Capital Markets Day 5 April 2005 17
Field exploration 2005
Sweden - 25 drilling targets mainly in the Skellefte Field
Exploration Permits covering 100 000 hectares
Joint Venture with Inmet in Bergslagen
Ireland- 18 drilling targets around Tara mine, South-easternand South-western part of Ireland
Exploration Permits covering 140 000hectares
Boliden – Capital Markets Day 5 April 2005 18
Garpenberg: Successful mine-site explorationGarpenberg: Successful mine-site exploration
Lina shaft
Gruvsjö shaftCapacity: 450 000 tpa
ShaftCapacity: 850 000 tpa
Garpenberg Garpenberg Norra
Lappberget
800 Z
400 Z
0 Z
Boliden – Capital Markets Day 5 April 2005 19
Lappberget Front view
B
500 Z
AC
Measured resource
Reserve
800 Z
1041 Z
1113 Z
1213 Z
Indicated resourceInferredresource
Potential
Potential
1113 Z
800 Z
OreReserve
B
500 Z
AC
Measured resource
Reserve
800 Z
1041 Z
1113 Z
1213 Z
Indicatedresource
Inferredresource
Potential
Potential
1113 Z
800 Z
OreReserve
LappbergetLeft view
Lappberget – Ore Reserve 2005-01-01
Boliden – Capital Markets Day 5 April 2005 20
B
500 Z
AC
Measured resource
Reserve
800 Z
1041 Z
1113 Z
1213 Z
Indicatedresource
Inferredresource
Potential
Potential
Potential
1113 Z
800 Z
Lappberget - ore reserve 2005-01
New drilling position
Boliden – Capital Markets Day 5 April 2005 21
Kristineberg / J-zon
Boliden – Capital Markets Day 5 April 2005 22
Kristinebergsgruvan: Profil 1025
BORRHÅL PROFIL FRÅN TILL LÄNGD AU AG CU ZN PB S2666 1025 Svag mineralisering, geofysisk övre kant2670 1025 111.50 113.05 1.55 0.43 57 3.51 1.11 0.03 35.62678 1025 123.85 128.50 4.65 2.06 64 2.20 9.99 0.15 45.02673 1025 141.65 147.20 5.55 2.37 57 1.68 9.33 0.19 41.92679 1025 257.90 262.20 4.30 0.50 85 0.22 18.30 0.72 28.82682 1025 157.25 160.10 2.85 16.51 157 6.07 2.73 0.04 22.22682 1025 171.25 176.15 4.90 0.73 68 2.71 2.16 0.10 39.02688 1025 280.70 289.30 8.60 0.55 129 0.09 34.85 1.35 31.32695 1025 241.60 246.05 4.45 0.03 3 0.04 14.70 0.00 14.9
Boliden – Capital Markets Day 5 April 2005 23
BORRHÅL FRÅN TILL LÄNGD AU AG CU ZN PB S2850 Svag mineralisering.2854 161.20 164.15 2.95 0.60 35 0.78 15.40 0.13 42.702863 68.80 76.90 8.10 0.14 359 0.11 5.02 1.66 10.212863 242.55 253.95 11.40 1.87 80 1.58 11.13 0.29 40.862863 319.25 323.90 4.65 1.75 76 0.95 11.30 0.11 35.722876 71.15 77.75 6.60 0.17 391 0.03 3.57 1.98 8.82
Kristinebergsgruvan: Profil 850
Boliden – Capital Markets Day 5 April 2005 24
BORRHÅL FRÅN TILL LÄNGD AU AG CU ZN PB S2873 242.90 245.60 2.70 0.80 155 0.02 27.00 2.46 19.102873 261.80 282.25 20.45 0.56 83 0.66 12.16 1.38 28.342882 Svag mineralisering2889 Svag mineralisering
Kristinebergsgruvan: Profil 700