LBMA Precious Metals Conference 2014 10 November 2014

Session 4 – Roque Benavides 1

Roque Benavides - President and CEO Compañía de Minas Buenaventura S.A.A.

Lima, November 11th of 2014

Challenges in financing the growth of a precious metals mining company

Overview of the Peruvian mining sector

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Peru is in the top 5 worldwide mining producers ranking

2013 World production ranking

Metal Latin-American World

Zinc 1 3

Tin 1 3

Silver 2 3

Copper 2 3

Lead 1 4

Gold 1 5

Mercury 2 5

Source: USGS (U.S. Geological Survey) 2014

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Mining in Peru represents

14.4% National GDP*

20.8% Private investments

61.8% National exports

29.2% 3rd category income tax

40.2% Corporative income tax

Source: Varias. INEI, BCRP, MINEM, SNMPE y E&Y *Base year 2007

The mining sector role in Peru

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Share of the mining activity in the territory

Source: MINEM. Boletín estadístico de minería. Reporte anual 2013.

Description Millions Has. Percentage Land extension of Peru: 128 Has. 100% Restricted areas for mining: 89.8 Has. 69.3% Operation: 1.15 Has. 0.90% Exploration: 0.42 Has. 0.33% Other areas for mining activities: 0.18 Has. 0.14%

Only the 1.37% of the Peruvian land extension have

activity related to mining.

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2013 Word reserves ranking

Metal Peru (‘000 tones) World (‘000 tones) Ranking

Silver 120 540 1

Copper 76,000 680,000 3

Zinc 18,000 250,000 3

Lead 7,900 89,000 4

Molybdenu 450 11,000 4

Tin 310,000 4’900,000 6

Gold 2,200 52,000 7

Peru is also in the top worldwide reserves ranking

Source: MINEM. Anuario Minero Agosto 2013.

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Peruvian gold production since 1998

Peru: Gold production 1998-2002 (Thousands of ounces)

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Peru: Silver production 1998-2002 (Thousands of ounces)

Source: MINEM. Elaborated: PwC 2013 Industria Minera. Guía de negocios en el Perú.

Peruvian silver production since 1998

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Exploration

Discovery

Construction

Production

The mining sustainable cycle

Source: Buenaventura 10 Source: MINEM. Presentación “La minería en el Perú” PDAC 2014. Guillermo Shinno Huamaní

US$ MM.

Fuente: MINEM. Boletín estadístico de minería. Reporte anual 2013.

What are the main activities in which the mining companies require to invest in order to preserve the cycle?

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Source: SNL, Metals Economic Group 2013 Ministerio de Energía y Minas. Boletín 2013

Perú :

US$ 774 MM.

In 2013, Peruvian exploration investments represented 5% of the worldwide exploration expenditure

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Financial alternatives in mining

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Mining financial options

What are today´s Financing option?

The key financing options for mining companies remain equity, debt or royalty & streaming financing

Source: PwC 3 things you need to know about alternative financing 14

Mining financial options according to its stage

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The breakdown of the mining money raisings

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Equity: Most used financing mechanism by the exploration mining companies

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5

10

15

20

25

30

0

50

100

150

200

5.08 3.04 5.07 3.04 1.58 5.14 1.43 5.07 4.06 4.67

Top 10 convertible bond issues

Proceeds Coupon

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Convertible bonds: One of the most used financing mechanism by the mining developer companies

US$ MM. %

Maturity (Years)

Molycorp

China Daye

Honbridge Noble

Atlantic San Gold Guildford

Duluth Firestone YTC

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Syndicated loans: One of the most used financing mechanism by the mining constructor companies

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Bonds: One of the most used financing mechanism by the mining producer companies

Buenaventura financial mechanisms

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Financial instruments used by Buenaventura in the past years

1996: Buenaventura was listed in the NYSE

2008: BVN entered into a syndicated loan for US$ 450 MM.

2009: Conehua entered into a lease agreement for US$ 119 MM. with BCP

2012: El Brocal entered into a medium-term loan contract for US$ 120 MM. with BCP

2013: El Brocal entered into a series of leaseback agreements for US$ 180 MM. with BCP

¿Why listing in the NYSE?

May 15th of 1996, Buenaventura was listed in the NYSE

• Attract new investors, mainly from USA, Canada, Europe and Asia

• Bring out more liquidity to the shares

• Look up for financing in order to develop new mining projects

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• Find a mechanism to commit with the highest governance corporative standards

BVN LISTED

NYSE

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BVN: Before and after the listing in the NYSE

Market Capitalization:

Before: US$ 660MM (BVL since 1971). After: US$ 2.8B (31.12.2013 – NYSE since 1996).

Transaction Volume: Before: Less than US$ 1MM daily. After: US$ 25MM daily.

Shareholders:

Before: 10% foreign institutional investors

After: 55% foreign institutional investors (USA, UK, Europe, Brasil, Chile). Funds like: Blackrock, Fidelity and Templeton.

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Our operations: Before: • Ran six underground mines (Julcani, Chacua, Orcopampa, Recuperada, Íshihuinca and Shila). • Yanacocha (43.65%), one of the biggest gold mines in the world. • Cerro Verde (9.2%), one of the biggest copper producer in the world.

After: • Runs five underground mines (Orcopampa, Chacua, Julcani, Mallay and Marca Punta). • Operates four open pit mines (Breapampa, Colquijirca, La Zanja and Tantahuatay). • Yanacocha (43.65%). • Cerro Verde (19.58%). • El Molle Verde (100%) – Trapiche project. • Canteras del Hallazgo (100%) – Chucapaca project.

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BVN: Before and after the listing in the NYSE

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0

50

100

150

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250

300

350

400

450

500

1990 1993 1996 1999 2002 2005 2008 2011

Au Production 000 Oz*

1996: BVN was listed in the NYSE

*Direct Operations

BVN: Before and after the listing in the NYSE

Source: Buenaventura

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2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

1990 1993 1996 1999 2002 2005 2008 2011

Ag production 000 Oz*

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1996: BVN was listed in the NYSE

*Direct Operations

BVN: Before and after the listing in the NYSE

Source: Buenaventura

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BVN: Adittional information

• First Latin-American company in being listed in the NYSE.

• The transactional volume of BVN in NYSE is higher that the all transactional volume of BVL.

• Good practices of corporative governance :

• Only 1 type of shares. • 5 independent directors. • Corporative governance committee, Audit committee and

Compensation committee. • Accountability.

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0

10

20

30

40

50

60

15/05/1996 15/05/2000 15/05/2004 15/05/2008 15/05/2012

BVN from 1996 to Up-to-date

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1996: BVN was listed in the NYSE

2005: BVN increased its state in Cerro Verde to 18.5%

2008: BVN unwinded its hedge book

2014: BVN acquiered Chucapaca

Source: Buenaventura

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Roque Benavides, President and CEO www.buenaventura.com