Our assets

The KGHM Polska Miedź S.A. Group holds geographically diversified mining assets (mines of copper ore and accompanying elements, such as silver, molybdenum, nickel, gold and other precious metals) located in Poland, the USA, Chile and Canada and copper smelters in Poland.

The key international asset – the Sierra Gorda mine, which is a joint venture between KGHM INTERNATIONAL LTD., Sumitomo Metal Mining and the Sumitomo Corporation – is located in Chile. In addition, the KGHM Polska Miedź S.A. Group has mine projects which are at the preproduction phase (among others Victoria, Sierra Gorda Oxide), as well as other exploration projects.

Production activity of the KGHM Polska Miedź Group across the world

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Polkowice-Sieroszowice Mine
Location	Lower Silesia, Poland	The Polkowice-Sieroszowice Mine is located in Lower Silesia, to the west of the town of Polkowice. Currently, it conducts mining works in four mining areas: Polkowice, Radwanice Wschodnie, Sieroszowice and in a part of the Głogów Głęboki – Przemysłowy (Deep Głogów) deposit. Within the Sieroszowice mining area, there are also rich deposits of rock salt above the copper-bearing horizon
Ownership	KGHM Polska Miedź S.A.
Type of mine	underground
Main ore type	copper ore
Accompanying mineral	Silver, lead, rock salt, gold
Type of orebody	stratiform
End product	copper ore
Copper in extracted ore in 2020	191,0 tys. Kt

Mining is conducted using room-and-pillar methods with natural roof settlement, using blasting technology. The Polkowice-Sieroszowice Mine’s current production capacity is around 12 million tonnes of ore per year.

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Rudna Mine
Location	Lower Silesia, Poland	The Rudna Mine is located in Lower Silesia, to the north of the town of Polkowice. It mines the copper deposit in the Rudna mining area as well as in parts of the mining areas of Sieroszowice, Lubin-Małomice and Głogów Głęboki-Przemysłowy (Deep Głogów). The copper orebody in the currently mined deposit ranges from 844 meters to 1,250 meters. Mining is conducted using room-and-pillar methods with natural roof settlement with hydraulic backfill, using blasting technology. The current average production capacity is approx. 12 million tonnes of ore per year.
Ownership	KGHM Polska Miedź S.A.
Type of mine	underground
Main ore type	copper ore
Accompanying mineral	silver, lead, gold
Type of orebody	stratiform
End product	copper ore
Copper in extracted ore in 2020	177,4 tys. Kt

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Lubin Mine
Location	Lower Silesia, Poland	The Lubin Mine is located in Lower Silesia, to the north-west of the boundary of the town of Lubin. It mines the copper deposit in the mining area Lubin-Małomice at a depth from 550 meters to 1,006 meters. Mining is conducted using room-and-pillar methods with natural roof settlement with hydraulic backfill, in the vicinity of the support pillar of the town of Lubin, using blasting technology. The mine’s current production capacity is around 8 million tonnes of ore per year.
Ownership	KGHM Polska Miedź S.A.
Type of mine	underground
Main ore type	copper ore
Accompanying mineral	silver, lead, gold
Type of orebody	stratiform
End product	copper ore
Copper in extracted ore in 2020	73,5 tys. Kt
Głogów Copper Smelter
Location	Lower Silesia, Poland	This complex of metallurgical plants located in Głogów comprises two copper concentrate smelting lines based on the technology of one-stage concentrate smelting in flash furnaces. Apart from electrolytic copper, the Głogów Copper Smelter and Refinery Division produces crude lead (about 30 thousand tonnes annually), silver (around 1,218 tonnes), gold (around 2 tonnes) and sulphuric acid (over 500 thousand tonnes).
Ownership	KGHM Polska Miedź S.A.
Type of metallurgical plant	smelter/refinery
End product	electrolytic copper
Electrolytic copper production in 2020	437,1 tys. kt
Legnica Copper Smelter
Location	Lower Silesia, Poland	The smelter and refinery located in Legnica has a current production capacity of 120 thousand tonnes of electrolytic copper. It has been in operation since the 1950s and uses shaft furnace technology. Apart from electrolytic copper, the smelter also produces around 30 thousand tonnes annually of refined lead and also around 100 thousand tonnes of sulphuric acid, as well as copper sulphate and nickel sulphate.
Ownership	KGHM Polska Miedź S.A.
Type of metallurgical plant	smelter/refinery
End product	electrolytic copper
Electrolytic copper production in 2020	123,3 tys. kt
Cedynia Wire Rod Plant
Location	Lower Silesia, Poland	Production at the Cedynia Wire Rod Plant located in the vicinity of Orsk is based on the use of copper cathodes from the Głogów Copper Smelter and the Legnica Copper Smelter. The basic product of the Cedynia Wire Rod Plant is copper wire rod produced in a Contirod line amounting to around 250 thousand tonnes annually and around 18 thousand tonnes annually of oxygen-free copper wire rod produced in an UPCAST line, including oxygen-free, silver-bearing copper wire rod.
Ownership	KGHM Polska Miedź S.A.
Type of metallurgical plant	processing
End product	copper wire rod and Cu-OFE rod
Production in 2020	245.4 kt of copper wire rod and 14.1 kt of oxygen-free copper rod

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Robinson Mine
Location	Nevada, USA	The mine is located in White Pine county, Nevada, USA, around 11 km west of Ely (approx. 400 km north of Las Vegas), in the Egan range, at an average altitude of 2,130 meters a.s.l., near highway no. 50. The mine comprises 3 large pits: Liberty, Tripp-Veteran and Ruth. Currently, Ruth is in operation. The ore is extracted by conventional methods, and is then processed into a copper and gold concentrate, and separately into molybdenum concentrate in a concentrating plant.
Ownership	100% KGHM INTERNATIONAL LTD.
Type of mine	open pit
Main ore type	copper ore
Accompanying mineral	gold and molybdenum
Type of orebody	porphyry/skarn
End product	copper and gold concentrate, molybdenum concentrate
Payable copper production in 2020	47,4 tys. kt

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Carlota Mine
Location	Arizona, USA	The Carlota mine is located in the Western part of the Miami-Globe mining region, in the state of Arizona at an altitude of 1,300 meters a.s.l. Surrounding the mine is mountainous, desert terrain. In the Carlota mine copper ore is extracted by conventional methods typical for open-pit metals mines, i.e. the ore is mined by blasting and then transported by haulage trucks. In 2018 mining re-commenced in the Eder South area.
Ownership	100% KGHM INTERNATIONAL LTD.
Type of mine	open pit
Main ore type	copper ore
Type of orebody	porphyry
End product	copper cathodes
Payable copper production in 2020	5,0 tys. kt

Due to the nature of the ore, it is processed using the heap leach, solvent-extraction and electrowinning method. The end product is electrolytic copper in the form of cathodes.

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Sudbury Basin
Location	Sudbury, Ontario, Canada	The Sudbury Basin is located in central Ontario in Canada, approx. 400 km north of Toronto. In this region KGHM INTERNATIONAL LTD. owns a variety of assets; however, since April 2019, mining has only been conducted in the underground McCreedy West mine due to the fact that the Morrison/Levack mine was placed into Care & Maintenance. Extraction is through mining methods which are dependent on the geometry of the deposit – mainly a mechanised method of selective extraction using undercutting of successive levels from bottom to top at various mine levels. All of the ore extracted from the mine, containing copper, nickel and precious metals, is processed in the Clarabelle plant in Sudbury, owned by Vale.
Ownership	100% KGHM INTERNATIONAL LTD.
Type of mine	underground
Main ore type	copper ore, nickel, platinum, palladium and gold
Type of orebody	footwall/contact Ni
End product	copper and nickel ore with precious metals
Payable copper production in 2020	2,1 tys. kt
Victoria Project
Location	Zagłębie Sudbury, Ontario, Canada	This project is located in the Canadian province of Ontario, approx. 35 km west of the town of Sudbury. In 2002 rights were acquired to the Victoria mineral deposit and a campaign of exploration in this region commenced. The current development scenario for the project calls for the sinking of 2 shafts to access the deposit (a production shaft and a ventilation shaft). Exploration work performed thus far confirmed the continuity and characteristics of the mineralisation to the level of approximately 2,200 meters below the surface.
Ownership	100% KGHM INTERNATIONAL LTD.
Type of mine	underground
Main ore type	copper-nickel ore
Associated metals	gold, platinum and palladium
Mine life	14 years
End product	copper ore, nickel and precious metals
Forecast annual production	16 kt Ni, 18 kt Cu

Based on analytical work performed in 2017, the base scenario assumes the Victoria project will be developed in two stages, comprised of the sinking of a first shaft along with additional exploration, followed by sinking of the production shaft.

In 2020, exploration work continued to increase the knowledge of mineral resources in the project and measures were taken to maintain good relations with the project’s key stakeholders. Work has begun on preparing and securing selected infrastructure elements as a preparatory step for further project development.

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Ajax Project
Location	Kamloops, British Columbia, Canada	The Ajax project is located in British Columbia, Canada, 400 km north-east of Vancouver near the town of Kamloops. The project assumes the construction of an open-pit copper and gold mine and an ore enrichment plant, with associated infrastructure. By 2016 the project’s Feasibility Study was prepared setting out the initial economic parameters of the project. In December 2017, the Ministers of Environment and of Energy, Mines and Petroleum Resources of British Columbia (provincial authorities) decided against the granting of an Environmental Assessment Certificate for the Ajax project.
Ownership	KGHM INTERNATIONAL LTD. 80%; Abacus Mining and Exploration Inc. 20%
Type of mine	Open pit
Main ore type	copper ore
Associated metals	precious metals (gold and silver)
Mine life	19 years
End product	copper concentrate
Forecast annual production	53 kt Cu, 114 thousand ounces Au

In June 2018, the Government of Canada, through the Governor-in-Council (Cabinet), issued a negative decision regarding the implementation of the Ajax project due to its anticipated significant adverse environmental impact. The decisions were made through the environmental impact assessment process reflecting the substantial engagement of provincial and federal governmental agencies, First Nations and a broad spectrum of stakeholders, including thousands of local citizens.

Since the EA Certificate has not been granted, in 2020 the work focused mainly on monitoring and securing the project site in accordance with regulatory requirements. An Ajax project office was opened in Kamloops (British Columbia) as one of the elements of the activities focused on dialogue with the First Nations and the local community.

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Sierra Gorda Mine and Sierra Gorda Oxide Project
Location	Region II, Chile	The Sierra Gorda mine is located in the Atacama desert, in the Sierra Gorda administrative area in the Antofagasta region, in northern Chile, approx. 60 km south-west of the city of Calama. The mine is situated at the altitude of 1,700 meters a.s.l. and 4 km from the town of Sierra Gorda. On 1 July 2015 the Sierra Gorda mine commenced commercial production (since then it has prepared statements of profit or loss). The ore is extracted using explosives, and next is loaded and hauled away in trucks to the processing plant, where it is crushed and milled. The end product of Sierra Gorda’s processing plant is copper concentrate and molybdenum concentrate
Ownership	55% KGHM INTERNATIONAL LTD, 45% SMM SIERRA GORDA INVERSIONES LIMITADA, of which, respectively: -Sumitomo Metal Mining Co., Ltd. (31.5%) -Sumitomo Corporation (13.5%)
Type of mine	open pit
Main ore type	copper ore
Associated metals	molybdenum, gold
Mine life	23 years for the current deposit based on phase I of the investment, including actions to remove bottlenecks. Moreover, there is a possibility to extend the mine’s life using new deposits.
End product	Copper concentrate, molybdenum concentrate
Payable production in 2020	148.7 thousand tonnes of copper in concentrate, 16.3 million pounds of molybdenum in concentrate on a 100% basis, share of KGHM Polska Miedź S.A. is 55%

In 2020, despite the epidemiological situation caused by the COVID-19 pandemic, thanks to the safety measures taken and the mobilisation of employees, the Sierra Gorda mine continued its operation without significant disruptions. Sierra Gorda focused on implementing an optimisation program to improve the operation of the mine, processing plant, infrastructure and the tailings pond.

The actions increased the average annual daily sulphide ore processing volume in the mine from the baseline 110 thousand tonnes of ore per day to 124 thousand tonnes of ore per day. The Sierra Gorda mine continues to increase its cost efficiency and operational efficiency.

The Sierra Gorda Oxide project involves the leaching of the copper oxide ore of Sierra Gorda on a permanent heap and the production of high-quality copper cathodes in a solvent extraction and electrowinning (SX-EW) installation, over a period of 11 years. The average production of copper will be approximately 30 thousand tonnes per year. Currently, most of the oxide ore resources planned for processing have been mined and deposited near the location of the future plant. In 2020, supplementary work was continued in order to prepare for the next phase of engineering work and further development of the project.

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Franke Mine
Location	Antofagasta Region, Chile	The mine is located in a desert area of northern Chile, in the Altamira region, near the southern boundary of the Antofagasta region, near a public road connecting the mine with the Pan-American highway. Mining is conducted by conventional open-pit methods. Due to the nature of the ore, it is processed using the heap leach, solvent-extraction and electrowinning method. The end product is electrolytic copper in the form of cathodes.
Ownership	100% KGHM INTERNATIONAL LTD.
Type of mine	open pit
Type of orebody	IOCG (ore type containing iron, copper and gold)
End product	copper cathodes
Payable copper production in 2020	12,5 tys. kt

Other assets

No material changes in the structure of main assets in domestic companies transpired over the recent years. Domestic companies acting on behalf of KGHM Polska Miedź S.A. remain essential in securing the activity of its core business. They include:

PeBeKa S.A. – mining work contractor,
KGHM ZANAM S.A. – a supplier and service provider for mining machinery, it also provides production maintenance services in selected areas and participates in investment tasks,
KGHM Metraco S.A. – a supplier of copper scrap,
„Energetyka” sp. z o.o. – this company secures part of the energy needs of KGHM Polska Miedź S.A.

Investments in closed-end investment funds are used to manage selected non-core assets. A significant portion of these Funds’ assets are investments in the general field of healthcare, including Polska Grupa Uzdrowisk.

In addition, amongst the international companies is a group operating under the DMC Mining Services brand: DMC Mining Services Ltd., FNX Mining Company Inc., Raise Boring Mining Services S.A. de C.V., DMC Mining Services Corporation, DMC Mining Services Colombia S.A.S., DMC Mining Services (UK) Ltd. and DMC Mining Services Chile SpA, which provide services in shaft sinking, mine development work, above-ground and underground mine facilities, mine drilling, tunnel drilling for general construction purposes and engineering services.

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