We assume a capital cost of $6.2 bln, 24% above management’s previous guidance.

Previous guidance of $4.32 bln for the project (excluding the power plant) was given in

May 2010, and a cost of $662 mln for the power plant is based on a July 2011 estimate.

At our $6.2 bln capital estimate, and using $2.75/lb long-term copper, we calculate an

after-tax IRR for Cobre Panama of 11%. Recall that Inmet currently owns 80% of Cobre

Panama, with 20% owned by Korea Panama Mining Corp. (KPMC). KPMC paid $199 mln

for their 20% stake (deal officially closed on April 25, 2012), which represented their

share of development costs incurred to date, implying a 100% total amount of $995 mln

that has been spent to date on Cobre Panama