Initiating at Outperform (Speculative); Adding Polish Copper to the Chopin Liszt

Research evidence excerpt

Initiating at Outperform (Speculative); Adding Polish Copper to the Chopin Liszt

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period, by-product AISC is expected to average $1.17/lb. Pre-production capital is estimated at $6.4

billion. Lumina Metals is expected to progress a pre-feasibility study, followed by a feasibility study,

alongside other permitting streams, with a target for mining concessions to be granted in 2030.

Significant Infrastructure in Place. Relative to other mining projects, Lumina Metals benefits from

investments already made in infrastructure, including road access, highways, power, rail, ports, and a

nearby smelter. Mining is seen as a major contributor to the local economy while also providing access to

a skilled workforce. There is a large amount of community support for the Nowa Sól project.

Several Complexities. In our view, Lumina Metals needs to continue to credibly de-risk the project

across several fronts. First, with a combined effective tax rate of ~70% in the country, Lumina Metals

does not expect to proceed with the construction of the Nowa Sól project without an exemption or

amendment to the current mineral extraction tax legislation. Second, the Nowa Sól project is likely

to be viewed as carrying elevated technical risk due to depth of deposits, with ventilation, cooling,

and shaft-sinking making development more complex. Third, the Nowa Sól permitting process is long,

raising the risk of an extended timeline. Permitting coupled with the proposed build cycle suggests first

production is +10 years away. Fourth, as a preliminary economic assessment stage project, the Nowa

Sól technical report carries a number of contingencies, which may result in higher-than-expected costs

or a project that takes longer than expected to ramp up.