A NEW CAPSTONE · Unless otherwise indicated, Capstone has prepared the technical information in...

A NEW CAPSTONEFEBRUARY 2020

CAUTIONARY NOTE ON FORWARD LOOKING INFORMATIONThis presentation, and the documents incorporated by reference herein, may contain “forward-looking information” within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements”). These forward-looking statements are made as of the date of this document and Capstone Mining Corp. (“Capstone” or the “Company”) does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation. Forward-looking statements relate to future events or future performance and reflect our expectations or beliefs regarding future events. Forward-looking statements include, but are not limited to, statements with respect to the estimation of mineral resources and mineral reserves, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production and capital expenditures, the success of our mining operations, environmental risks, unanticipated reclamation expenses and title disputes. In certain cases, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “guidance”, “scheduled”, “estimates”, “forecasts”, "future state", “intends”, “anticipates”, “believes” or variations of such words and phrases, or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved” or the negative of these terms or comparable terminology. In this document certain forward-looking statements are identified by words such as “expects”, “approximately”, “could”, “expects”, “target”, “targeting”, “guidance”, “potential”, “extended”, “convert”, “will”, “provides” “plan” and “expected”. By their very nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, amongst others, risks related to inherent hazards associated with mining operations and closure of mining projects, future prices of copper and other metals, compliance with financial covenants, surety bonding, our ability to raise capital, Capstone’s ability to acquire properties for growth, counterparty risksassociated with sales of our metals, foreign currency exchange rate fluctuations, changes in general economic conditions, accuracy of mineral resource and mineral reserve estimates, operating in foreign jurisdictions with risk of changes to governmental regulation, compliance with governmental regulations, compliance with environmental laws and regulations, reliance on approvals, licences and permits from governmental authorities, impact of climatic conditions on our operations, aboriginal title claims and rights to consultation and accommodation, land reclamation and mine closure obligations, uncertainties and risks related to the potential development of the Santo Domingo Project, increased operating and capital costs, challenges to title to our mineral properties, maintaining ongoing social license to operate, dependence on key management personnel, potential conflicts of interest involving our directors and officers, corruption and bribery, limitations inherent in our insurance coverage, labour relations, increasing energy prices, competition in the mining industry, risks associated with joint venture partners, our ability to integrate new acquisitions into our operations, cybersecurity threats, legal proceedings, and other risks of the mining industry as well as those factors detailed from time to time in the Company’s interimand annual financial statements and MD&A of those statements, all of which are filed and available for review under the Company’s profile on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause our actual results, performance or achievements to differ materially from those described in our forward-looking statements, there may be other factors that cause our results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that our forward-looking statements will prove to be accurate, as our actual results, performance or achievements could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on our forward-looking statements.

COMPLIANCE WITH NI 43-101Unless otherwise indicated, Capstone has prepared the technical information in this presentation (“Technical Information”) based on information contained in the technical reports and news releases (collectively the “Disclosure Documents”) available under Capstone Mining Corp.’s company profile on SEDAR at www.sedar.com. Each Disclosure Document was prepared by or under the supervision of a qualified person (a “Qualified Person” or “QP”) as defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators (“NI 43-101”). For readers to fully understand the information in this presentation, they should read the Technical Reports (available on www.sedar.com) in their entirety, including all qualifications, assumptions and exclusions that relate to the information setout in this presentation which qualifies the Technical Information. Readers are advised that mineral resources that are not mineral reserves do not have demonstrated economic viability. The Disclosure Documents are each intended to be read as a whole, and sections should not be read or relied upon out of context. The Technical Information is subject to the assumptions and qualifications contained in the Disclosure Documents. For further details refer to the Company’s NI 43-101 Technical Reports as follows:

• Cozamin Mine, Zacatacas, Mexico published Jan 24, 2019, effective Oct 24, 2018;• Pinto Valley Mine Life Extension – Phase 3 (PV3) Pre-feasibility Study, Miami, Arizona, published Feb 23, 2016,

effective Jan 1, 2016; and• Santo Domingo Project, Region III, Chile, Feasibility Study Update, published Jan 3, 2019, effective Nov 26, 2018, in

addition see the Company’s news release of February 19, 2020.

The Technical Information in this presentation has been prepared in accordance with NI 43-101 and reviewed and approved by Brad Mercer, P. Geol., Capstone's Senior Vice President, Operations and Exploration, a Qualified Person as defined in NI 43-101.

ALTERNATIVE PERFORMANCE MEASURES“C1 cash cost”, “cash cost”, “adjusted EBITDA”, “operating cash flow before changes in working capital” and “net debt” are Alternative Performance Measures. Alternative performance measures are furnished to provide additional information. These non-GAAP performance measures are included in this presentation because these statistics are key performance measures that management uses to monitor performance, to assess how the Company is performing, to plan and to assess the overall effectiveness and efficiency of mining operations. These performance measures do not have a standard meaning within IFRS and, therefore, amounts presented may not be comparable to similar data presented by other mining companies. These performance measures should not be considered in isolation as a substitute for measures of performance in accordance with IFRS. For full information, please refer to the Company’s latest Management Discussion and Analysis published on its Financial Reporting webpage or on SEDAR.

CURRENCYAll amounts are in US$ unless otherwise specified.

FOOTNOTESRefer to the FOOTNOTES slide for all references throughout this presentation.

Cautionary Notes

CAPSTONE MINING (TSX:CS) • 2

https://capstonemining.com/investors/financial-reporting/default.aspx

Capstone Mining: Prudent Growth and Lower Costs


To build on 20% copper production growth and 10% lower costs by 2021 with a multi-asset portfolio to generate strong cash flows in all price environments

Strong balance sheet to fund low-risk brownfield expansions and greenfield optionality

To surface stakeholder value through exploration and operational excellence

Positioning to be optimized in time for higher copper prices

PV3 Optimization Study: series of low capital, quick payback projects to debottleneck operational performance;10% production growth with 10% lower costs by 2021; further growth possible by 2022

PV4 Expansion Study: targeting 100,000+ tpd

Low cost mine generating free cash flow at any copper price

On track to deliver 50% production growth by 2021: 50-55 Mlbs copper and 1.5 Moz silver post-expansion

Infill and step-out drilling to extend mine life up to 2030; to date results pointing to higher grades and wider intercepts

Top quartile, fully-permitted project in Chile; Cu-Fe-Au project with US$1.0 billion NPV8% and 2.8 yr payback

2020 Cobalt PEA Opportunity pointing to US$1.7 billion NPV8%; robust case to build a low cost, vertically integrated battery-grade cobalt business in Chile

Strategic process in place, to right-size or monetize Capstone’s ownership

SANTO DOMINGO2PINTO VALLEY1 COZAMINSTRATEGY

COMPLEMENTARY PORTFOLIO• Cozamin: first quartile cost mine with sustainable free

cash flow from growing copper and silver production• Pinto Valley: unrivalled leverage to copper with growing

production through quick payback, high impact projects• Santo Domingo: only fully-permitted greenfield project in

Chile

STEP CHANGE OPTIONALITY • Cozamin: exploration excellence and production growth• Pinto Valley: mill modernization and future expansion• Santo Domingo: strategic process ongoing and cobalt

opportunities

THE RIGHT MANAGEMENT TEAM• Focused on maximizing value of existing assets• Strong mine general managers operating as business

owners• Best in class exploration team with proven track record of

adding shareholder value through the drill bit

BALANCE SHEET FOR GROWTH• $27.5 million of sustainable cost cuts• Strong balance sheet• Unhedged copper exposure in anticipated bull market

POSITIONED FOR TRANSFORMATIONAL GROWTH

A New Capstone Mining


Why We’re Better Positioned Than Ever


NEW CAPSTONE

Asset Quality • Stronger, more concentrated asset base• Prudent capital investment plans to increase NAV

Growth • Near term 20% organic production growth and 10% lower costs• Cozamin and Pinto Valley have potential for significant expansions and/or

extensions to mine life• Santo Domingo provides transformational growth opportunity

Cost Structure • Sustainable cost reduction1 program eliminated $27.5M from the business; $15.0M was from Pinto Valley

• Cozamin no longer has a silver stream

Balance Sheet • Paid down $120M debt since 20171

• Peer leading lowest Net Debt to EBITDA ratio of 1.561

G&A • Peer leading lowest G&A of $0.08/lb; reduced G&A by $4M to ~$13M

Leadership • Lean, focused and driven management team• Decentralized structure, strong mine general managers operating as

business owners

Institutional59%

Retail and Other41%

Shareholder Composition

Institution Name % of S/OGRM Investments Ltd. 20.8%Korea Resources Corporation (KORES) 10.1%Ingalls & Snyder 9.5%Third Avenue Management 6.4%Columbia Threadneedle Investments (U.S.) 3.4%

Source: IPREO as of January 17, 2020 plus undisclosed shareholders as per Capstone’s best knowledge

Ticker TSX:CSShares Outstanding (as at Dec 31/19) 400 million

Market Cap (as at Feb 20/20) US$200 million

Cash and Cash Equivalent (as at Dec 31/19) US$44 million

Long Term Debt (as at Dec 310/19) US$210 million

Company SnapshotTop Five Institutional Shareholders Own 50% of Capstone

CAPSTONE MINING (TSX:CS) • 617-4 17-7 17-10 18-1 18-4 18-7 18-10 19-1 19-4 19-7 19-10 20-1

$.40

$.60

$.80

$1.00

$1.20

$1.40

$1.60

$1.80

Shar

ePr

ice

($C

)

0

4

8

12

Volu

me

(milli

ons)

Source: FactSet, Feb 21, 2020

Capstone Three Year Price & VolumeVolume Price

Canada50%

USA24%

Asia24%

Europe2%

Institutional Location

The Right Management Team


DARREN PYLOTPresident & CEO Over 30 years in mining, founder of Capstone Mining, acquired Cozamin for $3M, which has delivered over $450M free cash flow since.

RAMAN RANDHAWA, CPA, CAChief Financial Officer & SVPOver 19 years mining experience, previously at Goldcorp in multiple VP positions. Successfully lead Capstone’s recent effort to cut $30M of annualized costs.

BRAD MERCER, B.ScSVP, Operations & ExplorationOver 35 years experience managing mineral exploration programs. Exploration excellence has lead to 50% production growth and mine life extension at Cozamin.

JASON HOWE, CPA, CASVP, Corporate DevelopmentOver 15 years in mining and 25 years in accounting and finance. Instrumental in executing Capstone’s growth strategy.

WENDY KING, MBA, LLMSVP, Legal, Risk & Governance and Corporate SecretaryPracticing law for over 25 years as in-house counsel and private practice as international-tax specialist.

JERROLD ANNETT, P.Eng.VP, Strategy and Capital MarketsOver 25 years of global mining and capital markets experience, previously in senior strategic roles for jr. exploration companies and Head of Mining Institutional Sales at Scotiabank.

ALBERT GARCIA III, Ph.D PEVP, ProjectsOver 40 years of experience in engineering, mining and project management for large international capital-intensive projects in challenging locations.

ABEL GONZALEZ VARGASMine Manager, CozaminMining engineer-metallurgist with 30 years experience, previously at Grupo Mexico as general manager at different Mexico-based mines. At Cozamin, he consistently leads stellar operating performance while the mine is going undergoing major expansion.

MIKE WICKERSHAMMine Manager, Pinto ValleyChemical engineer with over 35 years experience in mining and mineral processing; in a series of roles at Rio Tinto's Iron Ore Company of Canada (IOCC) in various VP and GM roles. His leadership of PV’s optimization and growth strategies will position the mine for future operational excellence.

Source: Bing maps and boundaries are approximated

Pinto Valley: Only Operating Mine In This Historic District


• The Globe-Miami district is one of the oldest and most productive mining districts in the United States, with its first recorded production occurring in 1878. Since that time, more than 15 billion pounds of copper have been produced.

• Pinto Valley has produced more than four billion pounds of copper since 1975.

• Pinto Valley is currently the second largest employer in the Globe-Miami area; total economic impact in Arizona is >$270 million per year.

• Measured and Indicated Resource1 base of one billion tonnes, currently not in Reserve, has the potential to create long-term sustainable benefits for multiple generations.

Carlota(KGHM)

Pinto Valley

Miami (FCX)

Copper Cities (BHP)

Miami (BHP)

Old Dominion

(BHP)

2019Cost savingsSustainable $15M per year from contractors, power and consumables costs.

2020PV3 OptimizationPhase 1: capital investment of $15M, with one year payback to improve mill reliability, increase throughput and overall performance. Resulting in expected 10% production growth and 10% lower costs by 2021 with upside by 2022.

2020 PV4 Expansion Evaluating long-term growth potential of Measured and Indicated Resource estimate1

(inclusive of Reserves) of over 1.33 billion tonnes at 0.30% copper.

PV4 Expansion evaluating scenarios for potential expansions to 100,000+ tonnes per day.

2039+~20 years mine lifeCurrent mine life to 2039; total Reserve Estimate1 of 408 million tonnes grading at 0.31% copper.

Pinto Valley: An Exciting Future


A long-life, multi-generational asset. Currently focused on optimization and evaluating long-term growth potential beyond current mine life.

Mineral Resource Estimate as at December 31, 2018

(metric units) Mineral Resources at 0.17% TCu Cutoff(Inclusive of Mineral Reserves)

Category Tonnes(million)

Cu(%)

Mo(%)

Measured (M) 571 0.33 0.006

Indicated (I) 759 0.27 0.005

Total M + I 1,330 0.30 0.005

Inferred 146 0.24 0.005

See Appendix slide “Pinto Valley Mineral Reserve and Resource Estimate” or the Company’s 2018 Annual Information Form for full details.

0

10

20

30

40

50

60

70

80

Q1'19 Q2'19 Q3'19 Q4'19 2020E* 2021E* 2022+E*

Tonn

es p

er d

ay (‘

000)

Average daily throughput*

Phase 1: 2020

• Installation of secondary crushers, screen decks and ball mill shells

• $15M capital project, one-year payback

• Expected result: 10% Growth to 130M Ibs and 10% Lower C1 Costs to $1.90/Ib by 2021

Phase 2: 2021+

• In Dec 2019, tested operational limits and pushed throughput to an average of ~63 ktpd, setting an all-time daily record of ~70 ktpd

• Potential projects include improved blast fragmentation, increased fine ore storage capacity, new tertiary crushers and screens, Verti-mills for added grinding capacity, concentrate filtration and handling modifications, increased tailings capacity

• Study results will be released H2 2020, projects subject to capital approvals

Pote

ntia

l**

*2020E, 2021E and 2022+E from Company estimates, subject to change. Refer to the Company’s news release of February 11, 2020 for more details.** Potential estimates only, subject to results of PV Optimization analysis and study results, expected in H2 2020.

PV3 Optimization1: Low Capex, Quick Payback Projects


PV3 Optimization

New secondarycrusher and ball mill shells,~56-57 ktpd

2019 monthly average

All-time record of 70,334 tpdachieved on Dec 21st

18 days in December >60 ktpd

All permits are in

place to operate

within this targeted

range

NOTE: Tax cash flows estimated using current and deferred tax expense. Included in 2007, 2009 and 2010 of $20M, $24M and $20M, respectively, are stream payments in cash and shares from WPM.

Cozamin Has Delivered Best In Class Returns


Cumulative free cash flow of over $450M since 2007

Expansioninvestments

Acquisition

$3.19Avg. Cu $/lb: $3.15 $2.34 $3.42 $3.84 $3.66 $3.30 $3.03 $2.35 $2.27 $2.86 $2.92 $2.76$3.05

Total invested between 2006-2008 = $52 million

Target Area to upgrade to Indicated ResourcesCurrent Reserve BoundaryOne-way Ramp Remainder

Ventilation Raisebore

*Looking NE*

San Roberto Shaft

Hoisting 1800 TPD

Hauling 1250 TPD

Lowest Level of Reserves(-952m)

Bottom of Hoist(-458m)

Bottom of Hypothetical Expansion

(-575m)

Lowest Haulage Level (-736m)

Portal Elevation (-0m)

Top of Hypothetical Expansion

(-225m)

Calicanto RampGuadalupana Ramp

Footwall Zone Ramp

San Jose Ramp

One-way Ramp ConnectorExpected completion Dec

2020

A Look at Cozamin in 2018 Before 200 Hole Drill Program

Total Mined in MNFWZ(up to YE 2018)Tonnes: 2,777,202 @ Cu 1.94%

Reserve Remaining in MNFWZ(Opening balance 2019)Tonnes: 5,047,485 @ Cu 1.77%

Portree Claim


Ventilation Raisebore

Lowest Level of Reserves(-952m)Calicanto RampGuadalupana

RampFootwall Zone Ramp

San Jose Ramp

Portree Claim

San Roberto Shaft

Top of Hypothetical Expansion

(-225m)

Bottom of Hoist(-458m)

Bottom of Hypothetical Expansion

(-575m)

Lowest Haulage Level (-736m)

DDH Pierce Point (after Oct-2018 MRMR)Target Area to upgrade to Indicated ResourcesCurrent Reserve BoundaryOne-way Ramp Remainder

Hoisting 1800 TPD

Hauling 1980 TPD

U5042.53% CuTW 7.1m

S4465.16% CuTW 3.4m

S4443.31% CuTW 11.8m

S4474.99% CuTW 7.2m

S4408.29% CuTW 4.9m

S4557.65% CuTW 5.4m

S4455.31% CuTW 6.3m

One-way Ramp ConnectorExpected completion Dec

2020

Portal Elevation (-0m)

S4434.95% CuTW 1.8m

S4366.13% CuTW 1.7m

S4371.94% CuTW 19.3m

S4413.35% CuTW 5.4m

*Looking NE*

Cozamin Today Following the Release of 150/200 Holes

Total Mined in MNFWZ (up to YE 2018)Tonnes: 2,777,202 @ Cu 1.94%

Reserve Remaining in MNFWZ(Opening balance 2019)Tonnes: 5,047,485 @ Cu 1.77%

From MNSFW Mined in 2019820,292t @ Cu 2.00%

• Received all critical permits to start construction including approved mine closure plan

• Base Case1 Cu-Fe-Au US$1.51B capex; US$1.03B NPV8%

• Payback period (after-tax): 2.8 years

• PEA Cobalt1 Opportunity, incremental US$0.67B; potential to add additional US$0.63B to NPV8%

• Payback period (after-tax): 3.5 years

• Simple flowsheet using a series of conventional metallurgical steps to achieve 78% cobalt recovery and low costs

• 10.4 million pounds of cobalt per year LOM in the form of 22,600 tonnes per year of battery-grade cobalt sulfate

• -$4.11 per pound LOM net of by-product sulfuric acid would be amongst one of the lowest cost cobalt producers globally

• Potential to improve project economics with infrastructure sharing

SANTO DOMINGOA Rare First Quartile Project


Opportunity to Build a Low Cost, Vertically Integrated Cobalt Business in Chile

Source: RBC Capital Markets

Santo Domingo: Well-Positioned on the Global AISC Curve


2020E Global AISC Curve1 – Wood Mackenzie (US$/lb Cu and US$/lb CuEq)2

First Quartile Second Quartile Third Quartile Fourth Quartile

Copper Spot Price: $2.85/lb

Chart source: RBC Capital Markets (RBC Source: Wood Mackenzie, RBC database and company disclosure)• Projects shown on 100% basis; metrics unavailable for NuevaUnión (Newmont/Teck)• Pebble metrics based on a 2011 PEA that the company recognizes as out-of-date; a more recent technical report was filed in late 2017, but does not provide updated cost,

production and profitability metrics 1. Profitability calculated as after-tax NPV divided by sum of initial capex and expansion capex2. Based on adjusted Wood Mackenzie Model (assumes copper price of $3.30/lb and gold price of $1,350/oz)

Santo Domingo Boasts Robust Economic MetricsProfitability Index, After-Tax IRR and After-Tax NPV Benchmarking

Bubble size denotes after-tax NPV (US$bn)

$2.0$0.5 $1.5

PEA

Pre-Feasibility

Feasibility

Acquired


Pipeline Of News Flow


PINTO VALLEYCommence modernization projects starting with fine

crushing plant

SANTO DOMINGO Strategic process update

Updated NI 43-101, including recovering cobalt study results

COZAMINRaisebore development

completed

PINTO VALLEY PV3 Final EIS/Draft Record of Decision expected from USFS

PINTO VALLEY PV3 permit expected for Plan of Operations

PV3 Optimization study results of low-capital, quick-payback projects to execute on, to maximize existing mill

PV4 Expansion study results

COZAMINUpdated reserve and resource estimate with new mine plan

One-way haulage loop development completed

Q1 2020

Q2 2020

H2 2020

COMPANY-WIDE TARGETProduction +20% to ~180M Ibs/year,

C1 costs -10% to ~$1.70/Ib

COZAMINProduction of 50-55 Mlbs copper and

1.5 Moz silver

2021+

$-

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00

$16.00

Capstone Taseko CopperMountain

Hudbay Lundin Turquoise Hill Ero Copper

EV/2020 Guidance2 (US$/Cu lbs)

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

2019A C1 Cash Costs4 (US$)(2019A except where otherwise noted)

0.25x0.41x 0.45x 0.53x

0.92x 0.97x

1.46x

0.00x0.20x0.40x0.60x0.80x1.00x1.20x1.40x1.60x

Turquoise Hill Capstone Taseko CopperMountain

Hudbay Lundin Ero Copper

P/NAV1

Capstone: Extraordinary Deep Value


Average 0.71x Average $7.06

0

100

200

300

400

500

600

Contained Copper Production3 (Mlb’s)2020 Guidance

Significant Organic Growth• Focused on 20% expansion to ~180 million pounds at 10%

lower costs by 2021 and beyond

Time is Now for Free Cash Flow• Cozamin – expecting extend mine life to ~10 years and

increase output >50% to 50-55 million pounds of copper and 1.5 million ounces of silver per year

• Pinto Valley – modernization projects to enable higher milling rates in anticipation of improving copper markets

• Santo Domingo – rare, top quartile project that could provide transformational growth

• 100% unhedged copper exposure

Peer Leading Financial Position • Cost reduction program delivered $27.5 million • Lowest Net Debt to EBITDA of 1.561

2020 2021-2024

20% Organic Growth

A New Capstone


140 to 155

Mlbs

~180Mlbsper year

Capstone Mining: Prudent Growth and Lower Costs1. Refer to the Company’s news release “Capstone Beats 2019 Cost Guidance,

Commences PV3 Optimization Study” on February 11, 2020 for full details.2. Refer to the Company’s news release “Capstone Presents a Robust Cobalt

Production Option to the Santo Domingo 2019 Technical Report With a 2020 Preliminary Economic Assessment” on February 19, 2020 for full details.

Why We’re Better Positioned Than Ever1. Refer to the Company’s Management Discussion and Analysis for the year ended

December 31, 2019 for full details.

Pinto Valley: Only Operating Mine In This Historic District 1. Refer to Appendix slide “Pinto Valley Mineral Reserve and Resource Estimate” at the

end of this presentation and the Company’s 2018 Annual Information Form for full details.

Pinto Valley: An Exciting Future1. Refer to Appendix slide “Pinto Valley Mineral Reserve and Resource Estimate” at the

end of this presentation and the Company’s 2018 Annual Information Form for full details.

PV3 Optimization: Low Capex, Quick Payback Projects1. Refer to the Company’s news release “Capstone Beats 2019 Cost Guidance,

Commences PV3 Optimization Study” on February 11, 2020 for full details.

Cozamin: Growing Into An Even Better Cu-Ag Mine1. Refer to the Company’s news release “Capstone Steps Out Into 6.3m of 5.3% Cu:

Expansion and Infill Drilling Amongst the Best Results Ever at Cozamin” on January 16, 2020 for full details.

A Rare First Quartile Project1. Refer to the Company’s news release “Capstone Presents a Robust Cobalt Production

Option to the Santo Domingo 2019 Technical Report With a 2020 Preliminary Economic Assessment” on February 19, 2020 for full details.

Santo Domingo: Well-Positioned on the Global AISC Curve1. Source: RBC Capital Markets (RBC source: Wood Mackenzie, Bloomberg and company

disclosure)2. Wood Mackenzie 2020E cost curves calculated using the composite method (applies by-

product costs when the proportion of gold net revenue is greater than 65% and applies co-product costs when the proportion of gold net revenue is less than 65%)

Capstone: Extraordinary Deep Value1. Scotiabank Metals & Mining Research Daily Base Metals Comp, February 20, 2020, 8%

P/NAV. 2. EV (US$) from FactSet Jan 21, 2020; Attributable Guidance from company reports. 3. Company guidance.4. Company reports.

A New Capstone1. Refer to the Company’s Management Discussion and Analysis for the year ended

December 31, 2019 for full details.

FOOTNOTES


APPENDIX


Capital Investments and Future GrowthPinto Valley

• Mill modernization to improve reliability and overall performance, throughput expected to increase to ~57 ktpd by 2021 and beyond

Cozamin

• Expansion development of one-way ramp is on schedule and on budget for end of 2020, upon completion, expected increase in production to 50-55 Mlbs of copper and 1.5 Moz of silver for 2021 and beyond

Santo Domingo

• Low capital expenditures for the fully permitted Santo Domingo project in 2020 to preserve project optionality as we continue the strategic process in an improving copper market to right size or monetize Capstone’s ownership

Pinto Valley Cozamin Santo Domingo 2020 Total

Production and Costs (US$)

Copper Production (million pounds) 110 – 120 30 – 35 - 140 – 155

C1 Cash Costs2 $2.10 - $2.25 $0.95 - $1.10 - $1.85 - $2.00

Capital Expenditures (US$ millions, rounded)

Sustaining $28 $24 - $52

Capitalized Stripping $8 - - $8

Expansionary $19 $2 $93 $30

Total Capital $55 $26 $9 $90

Exploration (US$ millions, rounded)

Brownfield - $6 - $6

Greenfield - - - $4

Total Exploration - $6 - $10

2020 Production, Cost and Capital Guidance1


1. See the Company’s news release of January 22, 2020 for full details.2. This is an alternative performance measure; please see "Alternative Performance Measures" at the beginning of this presentation. C1 cash cost

per pound of payable copper produced net of by-product credits and selling costs. 3. On a 100% basis the figure is $12 million; ownership is 70% Capstone and 30% Korea Resources Corporation.

$44 MillionCash and cash equivalents*

$103 MillionRolling 12-month Adjusted EBITDA4

to Dec 31/19

$120 MillionTotal net cash repayments to

long-term debt since Jan 1/17*

1.56:1Net debt4/EBITDA4

OPERATIONAL OVERVIEW Q4 2019 2019Copper production1 (million pounds) 35.4 153.4

Copper sales1 (million pounds) 40.3 152.4

Realized copper price1 ($/lb.) $2.77 $2.71

FINANCIAL OVERVIEW (US$ millions) Q4 2019 2019Revenue from continuing operations2 113.6 418.7

Net (loss) income 13.4 (16.2)

Adjusted net (loss) income3,4 (7.8) (6.0)

Adjusted EBITDA from continuing operations2,3,4 22.5 102.5

Cash flow from operating activities2 22.1 92.9

Operating cash flow before changes in working capital2,4 20.3 79.8

*Refer to the Company’s Consolidated Financial Statements and MD&A for the year ended December 31, 2019 for full details.1. For continuing operations. The Minto mine was placed on care and maintenance in Q4 2018 and was considered a discontinued operation under IFRS 5 up until the date of sale (June 3, 2019).2. In accordance with IFRS 5, Minto’s results are excluded from revenue but included within cash flow amounts in both the current and comparative period. The Minto mine was sold on June 3, 2019.3. Certain prior period amounts have been restated to conform with current period classification.4. This is an Alternative Performance Measure; refer to the Company’s MD&A for the year ended December 31, 2019 for full details.

Q4 2019 and 2019 Financial Results*


$-

$2

$4

$6

$8

$10

$12

$14

$16

$18

$20

2018 2019 2020E*

US$

milli

on

G&A excl. depreciation Corp. office depreciation (non-cash)

Refer to the Company’s Annual Audited Financial Statements and MD&A for the year ended December 31, 2019 for full details. *2020E are Company internal estimates, subject to change.

Achieved $27.5M In Annualized Cost ReductionsPinto Valley Property CostsGeneral & Administrative Costs


$150

$160

$170

$180

$190

$200

$210

$220

$230

$240

$250

2018 2019 2020E*

US$

milli

on

Decreased site operating costs, from 2018 as a baseline, of approximately $0.80 per tonne milled

Areas of cost savings include $3.5M related to new revolver terms and improved cash management, $4M from downsizing corporate administration and $5M from disposition of Minto

DALE PENIUK, CPA, CA, B.CommFormer Assurance Partner, Mining, KMPG LLP and is currently Audit Committee Chair for Lundin Mining, ArgonaugtGold and Miramont Resources.

DARREN PYLOTPresident & CEO of Capstone Mining Corp.Over 30 years in mining, founder of Capstone Mining and Silverstone Resources. Currently also a board member with Zena Mining.

SEUNGWAN SHON, M.Sc Geology Has been with KORES since 2001 and currently leads their Metals Team, managing overseas copper projects. Has held numerous positions, including Mine Manager of Boleo Mine, Sr. Manager of KORES Corporate Partnership Team and Sr. Manager of the Exploration Team for Nonmetal Mineral Deposits in South Korea.

RICHARD ZIMMER, MBA, P.Eng, B.ScOver 40 years of mining and resource experience. Former President & CEO of Far West Mining, prior to that was with Teck Corporation, Teck-Cominco and Teck-Pogo. Currently also a board member with Alexco Resources and Ascot Resources.

GEORGE BRACK, MBA, CFA, BA ScChairman of the BoardOver 30 years in mining focused on exploration, corporate development and investment banking. Former Managing Director & Industry Head, Mining at Scotia Capital; President of Macquarie NA Ltd.; VP Corp Dev at Placer Dome and VP Mining at CIBC Wood Gundy. Currently also a board member with Wheaton Precious Metals and Alio Gold.

ROBERT GALLAGHER, BA ScOver 40 years of experience in developing and operating large-scale mining projects. Former President & CEO of New Gold; CEO of Peak Gold; VP Operations at Newmont Asia Pacific; as well as previously with Placer Dome. Currently also a board member with Southern Arc Minerals and Japan Gold.

PETER MEREDITH, CPA, CAFormer Deputy Chairman and CFO of Turquoise Hill Resources and spent 31 years at Deloitte as a Partner. Currently also a board member with Ivanhoe Mines, Great Canadian Gaming Corporation and Cordoba Minerals.

Board of Directors


Total Global Inventories Low Despite Recent Uptick


Low capex, high impact: 1 year payback

Modernizing PV Starting with Crushing Plant


The Opportunity80% of unscheduled downtime is due to issues in the fine crushing plant and ball mill circuits

The FixIn 2020, replace two secondary crushers and screens, two mill shells and install electrical upgrades

The Business Case• Higher throughput• Lower power and maintenance costs• Improved recoveries• $15M capital in 2020 with 1 year payback

Throughput expected to increase to ~57 ktpd by 2021 and beyond

1970 Crushing Technologysecondary crusher at Pinto Valley

2020 Crushing TechnologyFLS Raptor 900 crusher

Pinto Valley Mineral Reserve and Resource Estimate


Mineral Resource Estimate as at December 31, 2018(metric units) Mineral Resources at 0.17% TCu Cutoff

(Inclusive of Mineral Reserves) Contained Metal


Cu(%)

Mo(%)

Copper Metal(Mt)

Molybdenum(Mt)

Measured (M) 571 0.33 0.006 1.88 0.034

Indicated (I) 759 0.27 0.005 2.07 0.039

Total M + I 1,330 0.30 0.005 3.95 0.0073Inferred 146 0.24 0.005 0.34 0.008RESOURCE ESTIMATE NOTES: Claydon Craig, P.Eng., Superintendent of Mine Technical Services at Pinto Valley, is the Qualified Person responsible for the Pinto Valley Mineral Resources estimate. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. Mineral Resources are presented inclusive of Mineral Reserves. Mineral Resources are reported as at December 31, 2018 above a 0.17% TCu cut-off grade. The economic assumptions for the reasonable prospects pit include: $3.30/lb Cu, $10.00/lb Mo, 88% Cu recovery, 50% Mo recovery, $1.50/ton mining costs, $1.50/ton G&A costs, $5.00/ton milling costs, and a pit slope of 45°. Totals may not tally due to rounding. Contained metals are reported at 100%. See Capstone’s Annual Information Form for the year ended December 31, 2018 for further information.

Mineral Reserve Estimate as at December 31, 2018Mineral Reserve Contained Metal


Cu(%)

Mo(%)

Copper Metal(Mt)

Molybdenum (Mt)

Proven 255 0.33 0.006 0.84 0.016

Probable 153 0.28 0.006 0.43 0.009

Proven + Probable 408 0.31 0.006 1.27 0.025RESERVE ESTIMATE NOTES: Claydon Craig, P.Eng., Superintendent of Mine Technical Services at Pinto Valley is the Qualified Person responsible for the Pinto Valley Mineral Reserves estimate. Economic inputs to the block model were USD$2.75/lb Cu and USD$12.50/lb Mo. Mineral Reserves are reported above 0.175% Cu cut-off grade. Summation errors due to rounding. Contained metals are reported at 100%. See Capstone’s Annual Information Form for the year ended December 31, 2018 for further information.

Cozamin Mineral Reserve and Resource Estimate


Mineral Resource Estimate as at December 31, 2018Mineral Resources (Inclusive of Mineral Reserves) Contained Metal

Category Tonnes(kt)

Copper(%)

Silver(g/t)

Zn(%)

Pb(%)

Copper Metal(kt)

Silver Metal(koz)

Zinc Metal(kt)

Lead Metal(kt)

Measured (M) 407 1.24 53 1.23 0.40 5 698 5 2

Indicated (I) 16,709 1.50 44 1.25 0.27 250 23,813 208 46

Total M + I 17,116 1.49 45 1.25 0.28 255 24,506 213 47

Inferred 16,922 1.11 44 1.64 0.29 188 23,902 278 49RESOURCE ESTIMATE NOTES: The Cozamin Mineral Resource estimate was completed by Garth Kirkham, P.Geo., FGC, Kirkham Geosystems Ltd., and an independent Qualified Person as defined by NI 43-101. The NSRformula used is based on $3.50/lb Cu, $18/oz Ag, $1.20/lb Zn, $1.00/lb Pb and metallurgical recoveries of 95% Cu, 78% Ag, 58% Zn, 40% Pb. The resulting NSR formula is Cu*65.024 + Ag*0.438 + Zn*10.755 + Pb*6.981. Mineral Resources are reported above $50/t NSR cut-off. Mineral Resources are presented inclusive of Mineral Reserves. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. Figures may not sum due to rounding. Contained metals are reported at 100%. See Capstone’s Annual Information Form for the year ended December 31, 2018 for further information.

Mineral Reserve Estimate as at December 31, 2018Mineral Reserve Contained Metal

Category Tonnes(kt)

Cu(%)

Ag(g/t)

Zn(%)

Pb(%)

Copper Metal(kt)

Silver MetalTroy (koz)

Zinc Metal(kt)

Lead Metal(kt)

Proven - - - - - - - - -

Probable 6,050 1.58 43 0.72 0.14 96 8,293 43 8

Proven + Probable 6,050 1.58 43 0.72 0.14 96 8,293 43 8RESERVE ESTIMATE NOTES: Tucker Jensen, P.Eng., Senior Mining Engineer at Capstone Mining Corp., is the Qualified Person for the Cozamin Mineral Reserve. Disclosure of the Cozamin Mine Mineral Reserves as of December 31, 2017 was completed using fully diluted mineable stope shapes generated by the Maptek Vulcan Mine Stope Optimizer software and estimated using the 2018 MNFW and MNV resource block models completed by Garth Kirkham, P.Geo., FGC, Kirkham Geosystems Ltd. The Reserves are based on a $50/t NSR cut-off. The NSR formula used for the Reserves was based $2.75/lb Cu, $16/lb Ag, $1.10/lb Zn, and metallurgical recoveries of 96.5% Cu, 81% Ag, 44% Zn. The resulting NSR275 formula is ($50.707*%Cu + 0.366*Ag ppm + 7.276*Zn%)*(1-NSRRoyalty%)Note that zero value is attributed to Pb due to low concentrations. Tonnage and grade estimates include dilution and recovery allowances. The NSR royalty rate applied varies between 1% and 3% depending on the mining concession. Contained metals are reported as 100%. Figures may not sum due to rounding. See Capstone’s Annual Information Form for the year ended December 31, 2018 for further information.

Mineral Reserve Estimate as at November 14, 2018Ore Grade Contained Metal

Reserve Category Ore(Mt)

Cu(%)

Fe(%)

Au(g/t)

Cu(Mlbs)

Fe Conc.(Mt)

Au(koz)

Proven Reserves 65.4 0.61 30.9 0.08 878.5 8.2 169.9

Probable Reserves 326.9 0.24 27.6 0.03 1,694.2 66.9 336.8

Total Reserves 392.3 0.30 28.2 0.04 2,572.7 75.1 506.7

MINERAL RESERVE ESTIMATE NOTES: 1. Mineral Reserves have an effective date of 14 November 2018 and were prepared by Mr. Carlos Guzman, CMC, an employee of NCL.2. Mineral Reserves are reported as constrained within Measured and Indicated pit designs and are supported by a mine plan featuring variable throughput rates and cut-off optimization. The pit designs and mine plan were

optimized using the following economic and technical parameters: metal prices of US$3.00/lb Cu, US$1,290/oz Au, and US$100/dmt of Fe concentrate; average recovery to concentrate is 93.4% for Cu and 60.1% for Au, with magnetite concentrate recovery varying on a block-by-block basis; copper concentrate treatment charges of US$80/dmt, US$0.08/lb of copper refining charges, US$5.0/oz of gold refining charges, US$33/wet metric tonnes (“wmt”) and US$20/wmt for shipping copper and iron concentrates respectively; waste mining cost of $1.75/t, mining cost of US$1.75/t ore, and process and G&A costs of US$7.53/t processed; average pit slope angles that range from 37.6º to 43.6º; a 2% royalty rate assumption, and an assumption of 100% mining recovery.

3. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.4. Tonnage measurements are in metric units. Copper and iron grades are reported as percentages, gold as grams per tonne. Contained gold ounces are reported as troy ounces, contained copper as million pounds and contained

iron as million metric tonnes.

Santo Domingo Mineral Reserve Estimate


Mineral Resource Estimate as at February 13, 2020Category Deposit Mt CuEq

(%)Cu(%)

Au(g/t)

Fe(%)

S(%)

Co(ppm)

Measured 66 0.81 0.61 0.081 30.9 2.3 254Indicated SDS/IN 416 0.49 0.24 0.033 26.4 2.2 239

Estrellita 55 0.40 0.38 0.039 13.7 0.0 125

Sub-Total 471 0.48 0.26 0.034 25.0 1.9 225

Total Measured and Indicated 537 0.52 0.30 0.039 25.7 2.0 229Inferred SDS/IN 42 0.42 0.18 0.024 25.0 2.4 208

Estrellita 5 0.32 0.31 0.030 12.3 0.0 108

Total Inferred 48 0.41 0.19 0.025 23.6 2.2 197

MINERAL RESOURCE ESTIMATE NOTES: 1. Mineral Resources are classified according to CIM (2014) definition standards.2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.3. The Qualified Person for the estimates is Mr. David Rennie, P. Eng., an associate of Roscoe Postle Associates Inc.4. Mineral Resources for the Santo Domingo Sur, Iris, Iris Norte, and Estrellita deposits have an effective date of 13 February 2020.5. Mineral Resources for the Santo Domingo Sur, Iris, Iris Norte, and Estrellita deposits are reported using a cut-off grade of 0.125% CuEq. CuEq grades are calculated using average long-term prices of US$3.50/lb Cu, US$1,300/oz Au, and US$99/dmt Fe conc. 6. Only copper, gold, and iron were recognized in the CuEq calculation.7. Mineral Resources are constrained by preliminary pit shells derived using a Lerchs–Grossmann algorithm and the following assumptions: pit slopes averaging 45º; mining cost of US$1.90/t, processing cost of US$7.27/t (including G&A cost); processing recovery of 89% copper and 79% gold; and metal prices of US$3.50/lb Cu, US$1,300/oz Au and US$99/dmt iron concentrate.8. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.9. Tonnage measurements are in metric units. Copper (“Cu”), iron (“Fe”) and sulfur (“S”) are reported as percentages, gold (“Au”) as grams per tonne and cobalt (“Co”) parts per million.

Santo Domingo Mineral Resource Estimate


GENERAL INQUIRES

Capstone Mining Corp. Suite 2100 – 510 West Georgia StreetVancouver, BC V6B 0M3

www.capstonemining.com [email protected] 1-604-684-8894 1-866-684-8894 (N.A. toll free)

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