Marimaca's Feasibility Study Delivers 31%+ IRR & Industry-Leading Capital Efficiency

• Sub-$12,000 per tonne copper equivalent production places Marimaca in the bottom decile of global copper projects according to Wood Mackenzie data
• Over $700 million post-tax NPV at $4.30/lb copper with 30%+ IRR, scaling to $1 billion+ NPV at higher copper prices
• Proactive approach to volatile input costs through potential sulfuric acid plant acquisition, reducing operational volatility
• Clear path from 50,000 to 70,000+ tonnes annual production through Pampa Medina and Madrugador oxide deposits
• Aggressive but achievable construction timeline targeting Q3 2026 start, with permits and debt financing expected by year-end 2025

Marimaca Copper, led by President and CEO Hayden Locke, has just released its Definitive Feasibility Study (DFS) for the Marimaca Oxide deposit in Northern Chile, marking a significant milestone for the company's development trajectory. The DFS validates what management has been communicating to investors over the past several years - that Marimaca represents an industry-leading copper development project.

"I'd start by saying I'm not unhappy with it, but I think there's room for improvement," Locke explained regarding the DFS results. Certainly we ran out of time and in the end we just decided to get it out in its form, knowing that it's a snapshot in time and it's not what we're going to base the build on."

Despite this measured assessment, the DFS confirms Marimaca's exceptional positioning within the global copper development landscape. The study represents a critical step toward production, though management emphasizes that significant engineering work remains before final investment decision.

The Marimaca Oxide deposit benefits from its location in Chile's established mining jurisdiction, offering political stability and well-developed infrastructure that supports the project's development timeline. The deposit's oxide nature allows for conventional heap leach processing, reducing both capital requirements and operational complexity compared to traditional sulfide copper operations.

Financial Metrics & Project Viability

The DFS delivers compelling financial metrics that position Marimaca among the most attractive copper development opportunities globally. According to Wood Mackenzie's database, the project ranks in the bottom decile for capital intensity among new development stage copper projects worldwide.

"What I'm pleased about is it confirms that we are in the bottom decile of capital intensity for new development stage copper projects globally. So we're sub $12,000 a tonne of copper equivalent production, which is a very nice place to be."

The project's operational cost structure proves equally impressive, with all-in sustaining costs positioned "right on the cusp of the first and second quartile." This combination of industry-leading capital efficiency with competitive operating costs generates exceptional investor returns.

At a base case copper price of $4.30 per pound, the project delivers over $700 million in post-tax NPV with an internal rate of return exceeding 30%. More significantly, at the higher copper price assumptions used by industry players like Ivanhoe Electric, the NPV scales to over $1 billion with IRR reaching the mid-40% range.

The planned production profile targets 50,000 tonnes per annum of copper cathode, with initial recovery rates of 78% improving the mine's overall 72% recovery rate. While these recovery rates may appear conservative, they provide a solid foundation for the economic model while offering potential upside through ongoing metallurgical optimization.

Interview with President & CEO, Hayden Locke

Engineering & Design Considerations

Management acknowledges that the current DFS represents a conservative approach to project design, with significant opportunities for cost optimization during the detailed engineering phase. The study incorporates design parameters suitable for high Andes operating conditions, despite Marimaca's location in the more favorable low Andes environment.

"Where have we over designed? Where can we take costs out of our CAPEX? In our view, there's quite a few areas where we have over designed things. Things have been designed for the high Andes, where the operating conditions, the weather conditions are significantly different to what we have down in the low Andes."

The engineering optimization process will run parallel to debt financing activities, ensuring neither workstream delays the other. This approach reflects management's confidence in the project's fundamental economics while pursuing opportunities for further enhancement.

Infrastructure scalability has been built into the initial design, accommodating future expansion without requiring complete reconstruction of core facilities. Water availability, power infrastructure, and the solvent extraction-electrowinning (SXEW) plant footprint all incorporate expansion capacity for the anticipated growth to 70,000+ tonnes annual production.

The focus on value engineering extends beyond simple cost reduction to encompass operational efficiency improvements. Management expects the detailed design phase to identify areas where conservative assumptions can be refined based on site-specific conditions and operating experience from comparable projects in the region.

Acid Price Exposure & Risk Management

Sulfuric acid price volatility represents one of the most significant operational risks facing the project, and management has developed a proactive strategy to address this exposure. The volatility in acid pricing "has the potential not to sort of ruin us or put us out of business, but to really degrade our margins and degrade our cashflow generation.

To mitigate this risk, Marimaca has secured an option to acquire a used sulfuric acid plant that would provide 30-40% of the project's base case acid requirements. The acquisition price of $2.5 million compares favorably to $60+ million for a comparable new facility.

"Our analysis of the sulfuric acid market versus the elemental sulfur market shows that in virtually all cases, you will have a net positive NPV relative to not installing that plant at a range of capital costs. What it really does is removes a lot of volatility from that underlying exposure to the acid price."

The plant, which has been non-operational since 2015, remains in relatively good condition despite some missing components. Management conducted on-site technical reviews and commissioned detailed engineering reports to assess the asset's viability. Even with 100% upside variability applied to capital cost estimates for dismantling, relocation, and recommissioning, the project maintains positive NPV.

This risk management approach demonstrates management's sophisticated understanding of operational challenges facing heap leach copper operations. The strategy provides meaningful downside protection while maintaining full upside exposure to favorable acid pricing environments.

M&A Landscape in the Copper Sector

The copper sector's M&A activity reflects the scarcity of quality development projects and the strategic value of near-term production assets. Recent transactions provide important benchmarks for evaluating Marimaca's potential value in a consolidation scenario.

"There are very few actionable copper projects in the near term that can become a reasonably significant producer of copper. Now we're at the smaller end of what's globally significant. I've said that regularly, 50,000 tons, but we have a growth pipeline that we think takes us to 70-80,000 tonnes, which is meaningful for everyone bar the majors."

Recent transactions underscore the premium values being placed on advanced copper projects. Harmony Gold's acquisition of MAC Copper for over $1 billion US represents a 50,000-tonne project similar in scale to Marimaca. The bidding war between Kinross and Cameco for New World Resources, though smaller than Marimaca, also demonstrates strong buyer interest.

Most significantly, Mitsubishi Corporation's announced transaction into Copper World suggests buyers are either underwriting significantly higher copper prices or paying substantial multiples to net asset value.

"My money is on them paying... underwriting a higher copper price because they're very much in the flow of that information."

These transactions reflect the strategic imperative for both mining companies and industrial users to secure copper supply in an increasingly constrained market. Marimaca's combination of near-term production, growth potential, and favorable jurisdiction positioning makes it an attractive consolidation target.

Growth Pipeline & Future Expansion Plans

Marimaca's growth strategy encompasses a multi-pronged approach designed to scale production from the initial 50,000 tonnes to over 70,000 tonnes annually through systematic development of satellite deposits. The strategy balances near-term production with longer-term growth opportunities.

The Pampa Medina deposit represents the most advanced growth opportunity, with a Preliminary Economic Assessment (PEA) nearing completion. Management is evaluating whether to release this as an integrated study with Marimaca or as a standalone analysis highlighting integration synergies.

"We're just thinking about the finalization of that study, which will be a couple of months, I would imagine. And that then really paints the picture of us being 50 going to 70,000 tonnes plus for more than a decade."

The Madrugador oxide deposit provides additional expansion potential, though it remains at an earlier stage of development. Like Pampa Medina, previous drilling focused on traditional manto blanco-style deposits in upper volcanic horizons, leaving deeper sedimentary opportunities unexplored.

Infrastructure scalability built into the initial Marimaca design enables cost-effective expansion integration. The modular approach to development allows for organic growth without requiring complete facility reconstruction, supporting the economic viability of the expansion strategy.

Management's disciplined approach to growth ensures that expansion opportunities meet rigorous return thresholds while maintaining operational integration benefits. The strategy provides multiple pathways to increased production scale while preserving optionality for future development phases.

Exploration Strategy & Potential Discoveries

The exploration program at Pampa Medina has evolved from initial discovery drilling to systematic resource definition, with results validating the theoretical framework for extensive sediment-hosted copper mineralization. Sergio Alves, the company's exploration lead, has successfully proven his thesis about Chile's first extensive sediment-hosted copper deposit. Locke emphasized regarding the exploration potential:

"When he told me there's a tier one opportunity - and if it's a tier one opportunity, we need to be spending money to try and work out how big an opportunity that is."

The current 10,000-meter discovery program has confirmed the deposit's unique characteristics within Chile's copper landscape. The identified mineralized area spans 1.2 kilometers east-west and 1.2 kilometers north-south, with average true thickness of the prospective sedimentary horizon ranging from 50 to 100 meters.

The next exploration phase will focus on infill drilling on 100-meter spacings within the defined area, potentially sufficient for an inferred resource estimate. Parallel step-out drilling will continue until the system's boundaries are established, with ongoing prospectivity identified to the north and west.

"We see value for our shareholders in moving it forward at a not too quickly, but at a decent speed. Once we're in production, reinvesting some of that cashflow that we make there in exploration will generate value for our shareholders."

The exploration strategy incorporates both oxide opportunities that complement the base case and deeper sulfide potential representing the "really big opportunity" for tier-one scale discoveries. This dual approach provides near-term resource growth supporting expansion plans while maintaining exposure to transformational discovery potential.

Looking Ahead: Permits & Construction Timeline

Marimaca's development timeline reflects an aggressive but achievable progression toward construction and production, with key milestones targeted for completion by year-end 2025. The permitting process represents the critical path item, with management expressing growing confidence in achieving the targeted timeline.

"Permits by the end of the year - the confidence is growing, but you never know what happens. But our current timelines are end of the year, we'll have our RCA."

The RCA (Environmental Impact Assessment) approval enables early site work commencement while additional permits are secured for full construction activities.

Debt financing activities proceed in parallel, with management targeting announcement of a credit-approved financing package by year-end. This timeline allows existing and potential equity investors to evaluate the debt-equity structure and assess free cash flow projections for equity holders. "Our objective is to have it announced by the end of the year," Locke stated regarding debt financing.

"Equity investors and both new and old can see what the debt equity split is going to look like, how much equity gap there's going to be, and how much free cash flow there's going to be left over for the equity holders."

The construction timeline targets commencement in Q3 2026, representing an ambitious but potentially achievable objective. "Maybe not achievable, but I'd hope we can start construction during the course of 2026," Locke acknowledged, demonstrating management's balanced approach to aggressive targeting while maintaining realistic expectations.

The Investment Thesis for Marimaca Copper

• Bottom decile capital intensity globally with sub-$12,000/tonne copper equivalent production and 30%+ IRR at base case assumptions
• Clear path to construction start in 2026 with 50,000 tonnes annual copper cathode production, generating immediate cash flow
• Systematic expansion to 70,000+ tonnes through Pampa Medina and Madrugador development, supported by integrated infrastructure
• Proactive management of operational risks through sulfuric acid plant acquisition option, reducing input cost volatility
• Tier-one discovery potential at Pampa Medina with both oxide expansion opportunities and deeper sulfide targets
• Northern Chile location provides political stability, established infrastructure, and low-cost power at 9 cents/kWh all-in
• Scarcity value in copper development space with recent transactions demonstrating premium valuations for quality assets
• Proven leadership team with successful track record in Chilean copper development and conservative approach to project execution
• Strategic partnerships with Mitsubishi and ASO providing balance sheet strength and technical expertise
• Development timeline aligns with anticipated copper supply deficits and structural demand growth from energy transition

Marimaca Copper represents a compelling investment opportunity within the global copper development landscape, combining industry-leading project economics with systematic growth potential and prudent risk management. The company's DFS validates management's long-standing assertions about the project's exceptional characteristics while providing a solid foundation for the transition toward construction and production.

The convergence of near-term production capability, significant expansion potential, and exploration upside creates multiple pathways for value creation. Management's conservative approach to development, combined with proactive risk mitigation strategies, positions the company to deliver on its ambitious timeline while maintaining operational and financial flexibility. For investors seeking exposure to copper's structural growth story through a high-quality development asset, Marimaca offers an attractive combination of visibility, scale, and upside potential.

Copper Market Macro Thematic Analysis

The global copper market faces a structural supply-demand imbalance that fundamentally supports higher long-term pricing and creates exceptional opportunities for quality development projects like Marimaca. The International Energy Agency projects copper demand will double by 2040, driven primarily by electrification and renewable energy infrastructure deployment.

Supply constraints compound this demand growth story. Major copper mines are aging, with ore grades declining globally while discovery rates for large-scale deposits have fallen dramatically over the past two decades. The average lead time from discovery to production now exceeds 15 years, creating a pipeline deficit that cannot be resolved quickly even with aggressive exploration spending.

Geopolitical considerations add another layer of complexity. China controls significant portions of copper processing capacity while also representing the largest demand center. Western economies increasingly prioritize supply chain security, creating premiums for production from stable jurisdictions like Chile.

The energy transition represents a paradigm shift for copper consumption patterns. Electric vehicles require four times more copper than internal combustion engines, while renewable power generation and grid infrastructure demand multiples of traditional power systems. This demand growth occurs at a time when traditional industrial copper applications remain robust.

Financial markets are recognizing this dynamic, with copper prices exhibiting increased volatility and higher baseline assumptions. Major financial institutions have revised long-term copper price forecasts upward, while mining companies are paying significant premiums for development projects and exploration assets.

These macro dynamics create an exceptionally favorable environment for advanced copper projects in stable jurisdictions. Marimaca's positioning in Chile, combined with its near-term production profile and growth potential, allows the company to capture multiple waves of value creation as market fundamentals continue strengthening. The strategic value of secured copper supply will only increase as the supply-demand gap widens over the next decade.