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Contractor  Presenta,on    May  16,  2013    

Rosemont Team Team with +550 Years Cumulative Experience in Mining

3

About Rosemont

Rosemont  Copper…   Ø  Is  located  in  Arizona,  30  miles  southeast     of  Tucson  in  the  Rosemont/Helve?a   mining  district   Ø  Will  be  about  10%  of  U.S.  copper   produc?on     Ø  Will  use  50%  less  water  than  tradi?onal   mines   Ø  Will  create  economic  benefits     4

Why Augusta? Large

M&I  Resource  of  7.5B  lbs  Cu  and  annual  produc?on  of  243M  lbs   Cu(1)  

Low cost

Low  cash  cost  (net)  at  $1.02  per  lb  of  Cu(2)  

High quality

30-­‐32%  clean  copper  concentrates  

Low risk

Excellent  infrastructure  in  a  secure  jurisdic?on  

Robust economics

AYer-­‐tax  NPV(3)  of  $2.5B  with  low  CAPEX  intensity  

Near term

Commence  construc?on  in  2013  

Strategic asset • Compelling investment 1.  Average  Annual  Life  of  Mine     2.  Using  60/40  Pricing  which  assumes  $14.19/lb/Mo,  and  Silver  Wheaton  Agreement  precious  metals  prices  of  $3.90/oz  Ag  and  $450/oz  Au   3.  Using  a  8%  discount  and  copper  price  of  $3.50  per  pound  copper   NOTE:  Rosemont  is  subject  to  a  80/20  Joint  Venture  Partnership  with  LGI  &  KORES,  all  metrics  are  currently  reported  on  a  100%  equity  basis  

TSX/NYSE AMEX:AZC

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Rosemont is low cost  $4.00    

($/lb Cu); cash costs, net of by-product credits

 $3.50      $3.00      $2.50      $2.00      $1.50    

Rosemont    $1.00      $0.50      $-­‐         1997  

1999   Median  Cost  

2001  

2003   9th  Decile  

2005   Marginal  Cost  

2007  

2009  

2011  

LME  Cash  Price  

Sources:  1.  LME  prices  are  annual  averages  with  2012  YTD  based  on  current  copper  price  as  at  June  30,  2012    2.  Goldman  Sachs  report  June  6,  2011  using  data  from   www.minecost.com;  Brook  Hunt;  GS&PA  Research  Es?mates    3.  Rosemont  2012  Feasibility  Study  Update   6

Rosemont Production When  in  produc?on,  Rosemont  will  be  among  the  top  five  largest  copper  mines  in  the  US                              2012  US  Copper  Produc?on  By  Mine  (Mlbs)  

 

632  

359  

1.  Based  on  Rosemont  2012  Feasibility  Study  Update.   Sources:  Company  Disclosure  and  Rosemont  2012  Feasibility  Study  Update.  

66  

46  

41   Mineral   Park  

100  

Miami  

134  

Robinson  

157  

Sierrita  

175  

Safford  

Bagdad  

Ray   Complex  

Bingham   Canyon  

Morenci  

197  

Mission  

235  

Silver  Bell  

Rosemont  LOM  Avg.:  243M  lbs  (1)  

Rosemont development model

Community   Community    

Economic            Benefits  

The     ROSEMONT   Team  

  Environment  

 

Ø  Ini?ate  community  rela?ons  efforts   early   Ø  Provide  community  support   Ø  Two-­‐way  communica?on  with  the   community   Ø  Establish  local,  county  and  business   support    

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Business Association Support Associa?ons  represen?ng  over  2000  businesses  and  their   employees  or  members:   Ø  ACT

 

 Alliance  of  Construc?on  Trades  

Ø  ABA

 

 Arizona  Builders’ Alliance  

Ø  ACA

 

 Arizona  Contractors  Associa?on  

Ø  AMIGOS

 Arizona  Mining  Industry  Gets  Our  Support  

Ø  ARP

 Arizona  Rock  Products  

 

Ø  SACA  

 Southern  Arizona  Contractors  Associa?on  

Ø  SAHBA  

 Southern  Arizona  Home  Builders  Associa?on  

Ø  SAEDG  

 Southern  Arizona  Economic  Development  Group  

Ø  TUCA  

 Tucson  U?lity  Contractors  Associa?on  

Ø  PALF  

 Pima  Area  Labor  Federa?on  

Ø  USW  

 United  Steelworkers  of  America  

Ø  SVEDF  

 Sierra  Vista  Economic  Development  Founda?on   9

Local, County and Business Support Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø 

City  of  Marana   Benson/San  Pedro  Chamber  of  Commerce   Benson  City  Council   Marana  Chamber  of  Commerce   Northern  Pima  County  Chamber  of  Commerce   Tucson  Hispanic  Chamber  of  Commerce   Tucson  Metropolitan  Chamber  of  Commerce   Metropolitan  Pima  Alliance   Nogales  Santa  Cruz  County  Chamber  of  Commerce   Willcox  Chamber  of  Commerce  &  Agriculture   Thatcher  City  Council   Sierra  Vista  Area  Chamber  of  Commerce   12,000  Families  signed  to  support   120  Southern  Arizona  business  leaders   10

Rosemont development model

Major  Economic  Engine  

Community    

Economic            Benefits  

The     ROSEMONT   Team  

  Environment  

 

Ø  Creates  almost  4,200  jobs  annually     in  the  USA     Ø  Provides  $1.2  billion  in  new   investment     Ø  Contributes  $3  billion  of  Federal   income  tax   Ø  Total  Economic  Impact  of  nearly   $30  billion  to  the  USA  over  the  life   of  mine  

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Rosemont development model SeOng  NEW  Environmental  Standards  

Community    

Economic            Benefits  

The     ROSEMONT   Team  

  Environment  

 

Ø  Filtered  Tailing  Technology  reduces  land   requirement  &  water  usage   Ø  Reducing  air  emissions  with  the  highest   emission  standards  in  mine  equipment   Ø  Air  quality  protec?on  with  high  efficiency   dust  collec?on   Ø  Permanent  land  conserva?on   Ø  Innova?ve  reclama?on  &  re-­‐vegeta?on   prac?ces  to  reduce  visual  impacts   Ø  Reduc?on  of  light  pollu?on  through  LED   outdoor  technology  

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Rosemont CAPEX CAPEX  Breakdown  ($M)   General  Site  /  Ancillary  Facili?es  

$60    

Mine  

$252  

Concentrator  &  Tailings  

$471    

Power  /  Water  Supply  

$122    

EPCM/Commissioning/  Spare  Parts  

$104    

Owner’s  Costs  

$163    

Con?ngency  

$51  

Sunk  Costs  (Equipment  &  EPCM)  

($113)  

Total  Construc,on  &  Commissioning  

$1,110    

Mine  Pre-­‐development    CAPEX   Total  CAPEX  

Con,ngency  

General  Site/   Ancillary  Facili,es  

Owner’s  Costs   EPCM/   Commissioning/   Spare  Parts  

Mine  

Power/Water   Supply   Concentrator  &  Tailings  

$116   $1,226  

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Rosemont is construction ready $90M  already  spent  on  equipment  

Most  major  equipment  procured  –  fixed   price  contracts  set  in  2008/2009  

Grinding  mills  and  drives  paid  for  and  delivered   14

6/4/13  

1515  

Updated Mineral Reserves ROSEMONT  SULFIDE  MINERAL  RESERVE  2012  UPDATE   Sulfides  >=  4.90  $/ton  NSR  Cutoff   Classifica,on   Ktons  

NSR  $/t  

TCu  %  

Mo  %  

Ag  oz/t  

Proven  

308,075  

20.29  

0.46  

0.015  

0.12  

Probable  

359,130  

18.67  

0.42  

0.014  

0.12  

Total  Reserves  

667,205  

19.42  

0.44  

0.015  

0.12  

Waste  +  Oxide  

1,243,455  

S/R  

1.9  

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Preferred Alternative – Barrel Only

Diagram  taken  from  Forest  Service  DraY  EIS  Execu?ve  Summary   17

Barrel Only Year 1

5700  

18

Barrel Only Year 10

5350   5700   5400  

19

Barrel Only Final

20

6/4/13  

2121  

Site Layout Tailings  Filtra,on     Mine  Shop  Area    

Primary     Crusher   Concentrator     Area    

N   22

Grinding Building

23

Flotation Building

24

Tailings Filter Building

25

Shiftable Conveyor with Spreader

26

Building Sizes §  Total of 16 buildings to be constructed. §  Top 7 in size listed below. Descrip,on  

Area  (square  feet)  

Coarse  Ore  Storage  Building  

113,000  

Filter  Building  

77,000  

Mill  Building    

41,000  

Flota?on  Building  

36,000  

Truck  Shop  

28,500  

Administra?on  Building  

16,000  

Concentrate  Loadout  

15,000  

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Construction Material Quantities Ø  Civil   Cut  –  6  million  cu  yds   Ø  Fill  –  5  million  cu  yds   Ø  Concrete   Ø  70,000  cu  yds   Ø 

Ø  Structural  Steel   Ø  8,000  tons   Ø  Equipment   Ø  Number  of  pieces  to  be  installed  –  1,800  

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6/4/13  

2929  

Permits  in  hand   Cer?ficate  of  Environmental  Compa?bility  (CEC)   Construc?on  Storm  Water  General  Permit   Agricultural  Land  Clearing  Permit   Air  Ac?vity  Permit   Groundwater  Withdrawal  Permit   Type  2.02  and  3.03  General  Aquifer  Protec?on  Permits   Arizona  Mined  Land  Reclama?on  Permits   Hazardous  Waste  Iden?fica?on  Number   Aquifer  Protec?on  Permit   Air  Quality  Control  Permit  

                                       

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Rosemont Forest Service Timeline 2009  

2007  

§  Feasibility  Study  updated   §  Approval  for  Reclama?on   Plan  and  Economic  Impact   Study  received  from  State   §  USFS  delays  DEIS  issuance,   provides  updated  ?meline   (ROD  Q4  2010)  

§  Mine  Plan  of   Opera?ons  filed   §  Ini?al  Bankable   Feasibility  Study   completed    

    2007  

2008  

2009  

2010  

2011  

§  USFS  delivers  prelim.  DEIS   to  state  and  local  agencies   §  No?ce  of  Availability  for     DEIS  issued  by  USFS     §  Cer?ficate  of   Environmental   Compa?bility  issued  

2011  

2012  

450+  technical  studies,  XX  man  hours  of  work     2008  

§  NEPA  process  launched,   EIS  process  ini?ated   §  Completed  extended   scoping  comment  period   §  USFS  updates  ?meline   (ROD  July  2010)   §  Permit  for  mine  water   supply  approved  

2010  

§  USFS  delayed  DEIS   release  for  addi?onal   study  and  modeling,   provides  updated   ?meline  (ROD  Q4  2011)   §  DEIS  presented  to  the   USFS  for  internal  review  

2013  

§  USFS  expects  ROD   Q3  2013  

2013  

2012  

§  Public  comment  period  for   DEIS  concluded   §  Aquifer  Protec?on  Permit     §  Internal  review  draY  of  FEIS   delivered  to  the  FS  on  Sept.   2012   §  USFS  delays  the  DEIS  release   for  addi?onal  study  

*5  years,  450+  technical  studies   31

Remaining  permits  to  acquire     Ø 

404  Permit   (ACOE*)  

Ø 

Public  comment   analysis  concluded   Monitoring  and   mi?ga?on  plans  in   development  

*ACOE:  U.S.  Army  Corps  of  Engineers   32

6/4/13  

3333  

EPCM Organization Chart Rosemont  Copper  

M3  Engineering  

Project   Engineering   Manager   •  •  •  •  •  •  •  • 

Process   Environmental   Systems   Disciplines   Specialists   Consultants   Engineering   Contracts  

Project   Procurement   Manager   Purchasing   Expedi?ng   Supplier   Quality   Assurance   •  Traffic   •  •  •  • 

Rosemont  Project   Manager  

Project  Controls   Manager   •  •  •  •  • 

Planning   Scheduling   Es?ma?ng   Cost  Control   Change   Management  &   Trending  

CDM  Smith  

Construc?on  Site   Manager  

Startup  

•  Constructability   •  Preopera?onal   •  Field  Engineering   Tes?ng   •  Field   •  Startup   Procurement  &   Assistance   Warehousing   •  Commissioning   •  Labor  Rela?ons   •  Construc?on   Contracts   •  QA/QC   •  Safety   •  Logis?cs   34

Rosemont  Copper   Construc?on  Management  Services    

Darrell   Himmesoete  

About  CDM  Smith   •  •  •  •  •  •  •  • 

Founded  in  1947   Mining  work  for  more  than  30  years   Employee  owned  /  operated   Over  5,000  staff  /     125+  offices  worldwide   Over  $1.2B  in  annual  revenues   Large  civil  /  infrastructure   Engineering  and  construc?on   Core  business  areas:     –  Water   –  Environmental   –  Transporta?on   –  Energy,  Oil  and  Gas   –  Mining  and  Minerals  

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Core  Values    

37  

HSE  Culture   •  •  •  • 

Zero  Injuries  /  Incidents   Zero  Environmental  Releases   Zero  MSHA  Cita?ons   Zero  Environmental  Cita?ons  

38  

6/4/13  

3939  

Ø 

All contractors on site are required to follow MSHA regulations, State regulations and Rosemont Copper Safety Standards

Ø 

Contractors will be required to have a safety program and a safety representative on site

Ø 

To have a culture that employees embrace and a workplace that enables all employees, vendors, and contractors, to return home safely, after completing their work with the time, tools and skills necessary to perform each task at hand.

“Core Value”! 40

Ø  All  contractors  will  be  expected  to  auend  Rosemont   environmental  training   Ø  Rosemont  approval  and  SDS  for  all  products  brought  on  site   prior  to  delivery     Ø  To  meet  environmental  obliga8ons  by  managing  environmental   impacts  and  implemen8ng  controls  for  pollu8on  preven8on.  All   employees  will  be  accountable  for  maintaining  compliance  with   requirements  designed  to  protect  the  environment.   "

"“Core Value”!

  41

Ø 

   Communica?ons  Limited  Alloca?on   Ø  Internet   Ø  Phone  

Ø  Ø  Ø  Ø  Ø 

   Construc?on  water      Construc?on  power      Concrete      Fuel  to  be  available  at  site  (Dry  Contracts)      Owner  Controlled  Insurance  Plan  (OCIP)   42

Ø  Compe??ve  bid   Ø  Based  on  Construc?on  Work  

Packages  (CWP)   Ø  Contract  may  be  one  or  mul?ple   CWP’s  (single  discipline  or  mixed)   Ø  Engineering  is  scheduled  to  deliver   according  to  CWPs     43

 

 

  Registra,on  

E-­‐bid  

 Pre-­‐   Qualifica,on    

Filtering  of   contractors   based  on   exper?se  

Qualifica,on  

Qualifica?on   form  sent  via   email  

Bid  &   Evalua,on       Award    

Online  contractor  registra?on  system.  The  E-­‐bid   system  will  be  enhanced,  you  will  receive  an  email   no?fica?on  to  update  your  profile.  

Filtering  of  contractors  based  on  informa?on   contained  in  E-­‐Bid.  i.e.  registered  and  competent   contractors  receive  a  Qualifica?on  Form.  

Review  

RFQ  

Qualifica?on  based  on  safety  sta?s?cs,  bonding   capacity,  previous  experience,  etc.  Poten?al   bidders  are  short  listed  based  on  Qualifica?ons.  

Bid   Evalua,on  

Award  

Invita?on  to  Bid  is  sent  to   Qualified  bidders.     Contract  is  awarded  based  on   Technical  Bid  Analysis  (TBA)   and  Commercial  Bid  Analysis   (CBA).  

Key  Evalua?on   Ø  Bid  must  conform  to  bid  package  structure  as   requested  in  the  RFQ   Ø  Safety  Record   Ø  Proposed  Team   Ø  Content  of  the  work  plan   Ø  Current  Work  Load   Ø  Prior  experience  in  the  work  requested   Ø  Price   Ø  Local  presence   45

    Ø     

Ø  Ø  Ø  Ø  Ø 

Combina?on  of  horizontal   and  ver?cal  packages     Design-­‐Build   Lump  Sum   Time  and  Materials   Unit  Price   Job  /  Service  Order  

  46

Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø  Ø       

Geotechnical  Evalua?on   Surveying   Compressed  Gases   Sanita?on  and  Water   Waste  Management   Security   Janitorial   Office  Supplies  and  Equipment   HVAC  Maintenance   Catering   Laundry  /  Uniforms   Lodging   Employee  Training   Environmental  Monitoring   47

Construction Tab

      Ø   

Ø  Ø  Ø  Ø  Ø 

ROD   Re-­‐start  Engineering   Develop  RFQ’s   Bid  Packages   Mobilize   Construc?on  

49

THANK  YOU  


Rosemont Contractors Presentation May 2013