Mr. Stuart McDonald reports

TASEKO REPORTS IMPROVED COPPER PRODUCTION AND SECOND QUARTER 2023 FINANCIAL RESULTS

Taseko Mines Ltd. had second quarter 2023 adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $22-million, earnings from mining operations before depletion and amortization of $28-million, and cash flows provided by operations of $33-million. Adjusted net loss was $4-million, or two cents per share.

Gibraltar produced 28 million pounds of copper and 230,000 pounds of molybdenum in the second quarter. Copper production was 13 per cent higher than the prior quarter as a result of higher grade, throughput and recoveries. Sales for the second quarter were 26 million pounds of copper (100-per-cent basis), slightly lower than the prior quarter, and also lower than second quarter production due to an increase of inventory in transit at the end of June.

Stuart McDonald, president and chief executive officer of Taseko, commented: "Mining operations are now well established in the lower benches of the Gibraltar pit, which have higher grades and larger, more consistent ore zones. Low mill availabilities had an impact on production in April and May, but in June and July we benefited from the softer ore in the Gibraltar pit and mill throughput averaged well above nameplate capacity. Copper production in June and July was 11 million pounds in each month. The Gibraltar pit will be the sole source of ore for the remainder of 2023. With increased copper production expected in the second half of the year we continue to track towards our original production guidance of 115 million pounds of copper (plus/minus 5 per cent).

"Total site costs at Gibraltar dropped by $7 -million over the previous quarter due to lower diesel and other costs, although the impact of cost reductions was partially offset by lower molybdenum prices which reduced the byproduct credit. Over all, unit operating costs dropped to $2.66 (U.S.) per pound of copper produced, 10 per cent lower than the first quarter and is expected to decline further in the second half of the year as production increases.

"Capital spending at Gibraltar was higher than normal in the quarter as work continued on the in-pit crusher relocation project and we completed a major component replacement on one of our mining shovels, at a cost of $10-million. Work on the in-pit crusher will wind down in the third quarter and the project will be completed in the second quarter of 2024 when the crusher is relocated," added Mr. McDonald.

Mr. McDonald concluded: "At Florence Copper, the Environmental Protection Agency (EPA) is advancing its process for the underground injection control permit. Based on our latest dialogue with the EPA, we believe they are close to making a final permit decision. In the meantime, we continue to advance discussions with potential financing partners for the remainder of the project financing package, which could include a copper royalty and/or a small project loan. These transactions would complement the committed funding from Mitsui, Bank of America and our revolving credit facility."

Second quarter review

Second quarter earnings from mining operations before depletion and amortization was $27.7-million, adjusted EBITDA was $22.2-million, and cash flows from operations were $33.3-million;

• GAAP (generally accepted accounting principles) net income was $10.0-million (three cents per share) and adjusted net loss was $4.4-million (two-cent loss per share) after normalizing for unrealized foreign exchange gains.
• Gibraltar produced 28.2 million pounds of copper for the quarter, a 13-per-cent improvement over the prior quarter as a result of improved grades, recoveries and mill throughput.
• Copper head grades in the quarter were 0.24 per cent, in line with expectations, as mining progressed deeper in the Gibraltar pit.
• Gibraltar sold 26.1 million pounds of copper in the second quarter (100-per-cent basis) with sales lagging production due to an increase of inventory in transit at the end of June.
• Total site costs in the second quarter were $105.4-million on a 100-per-cent basis, $7.4-million lower than the previous quarter due to lower diesel, explosive and contractor services costs.
• As a result of commodity price decreases in the quarter, the company wrote down lower grade ore stockpile inventory to net realizable values totalling $8.1-million (an impact of approximately three cents per share).
• On June 28, 2023, the company entered into a second amendment to its silver stream agreement with Osisko Gold Royalties Ltd. and received $13.6-million in exchange for increasing the payable silver from 75 per cent to 87.5 per cent and increasing the threshold delivery amount of silver for the additional mineral reserves published in 2022.
• In June, the company amended its revolving credit facility to increase the amount of credit approval of the facility from $50-million (U.S.) to $80-million (U.S.) with the addition of ING Capital LLC to the syndicate of lenders.
• The company had a closing cash balance of $86-million at June 30, 2023.
• The British Columbia port labour strike in the first half of July, 2023, did not have any impact on Gibraltar production but did restrict the mine's ability to ship concentrate after the quarter end. The backlog of Gibraltar concentrate inventory is expected to be shipped in the second half of the year.

Operations analysis

Gibraltar produced 28.2 million pounds of copper for the second quarter, a 13-per-cent increase over the first quarter due to higher mill throughput, ore grade and recoveries. As mining progressed deeper into the Gibraltar pit, ore grade and consistency improved which will continue for the remainder of the year. Mill throughput was 7.2 million tons for the period and was lower than planned due to mill downtime for additional maintenance.

Copper head grades of 0.24 per cent were higher than recent quarters and in line with management expectations as mining proceeds further into higher grade ore benches in the Gibraltar pit. Copper recoveries in the second quarter were 81.9 per cent and improved with the increasing head grades.

A total of 23.4 million tons were mined in the second quarter in line with mine plan. The ore stockpiles increased by 0.7 million tons in the second quarter and 1.7 million tons of oxide ore from the Connector pit was placed on the heap leach pads. This oxide ore will be processed in future years when Gibraltar's solvent extraction and electrowinning (SX/EW) plant is restarted.

Operations analysis -- continued

Total site costs at Gibraltar of $105.4-million were $7.4-million lower than last quarter due to a number of factors including lower diesel fuel costs, purchased electricity, natural gas, explosives and contractor services.

Sustaining capital expenditures in the quarter were $20.4-million and included $10.4-million for a major component replacement on one of the shovels. Gibraltar capital expenditures will decrease in the second half of the year as preparatory work for the primary crusher move is completed and with less equipment component replacements expected.

Molybdenum generated a byproduct credit of 13 U.S. cents per pound of copper produced in the second quarter, which decreased significantly from the first quarter. The molybdenum price decreased from the first quarter's average price of $32.79 (U.S.) per pound to an average of $21.30 (U.S.) per pound. This decreased molybdenum price also resulted in negative provisional price adjustments of $1.3-million in the second quarter.

Off-property costs per pound produced were 36 U.S. cents and were in line with recent quarters.

Total operating costs per pound produced (C1) were $2.66 (U.S.) for the second quarter, compared with $3.47 (U.S.) in the same period in 2022.

Gibraltar outlook

The Gibraltar pit will continue to be the sole source of mill feed for the remainder of 2023 and head grade and ore quality are expected to be similar to Q2 for the remainder of the year. Second quarter production was impacted by low mill availabilities in April and May, but in June and July milling operations benefited from the softer ore in the Gibraltar pit and mill throughput averaged well above nameplate capacity of 85,000 tonnes per day (tpd). Copper production in June and July was 11 million pounds in each month. Management continues to expect Gibraltar to produce 115 million pounds (plus/minus 5 per cent) of copper in 2023 on a 100-per-cent basis.

Gibraltar outlook -- continued

The in-pit crusher is now planned to be relocated in Q2 2024. This deferral of the crusher move results in increased mill production in the current year, and allows the timing of the crusher move to align with a maintenance shutdown that is required for the Mill No. 1 SAG mill.

Strong metal prices combined with the company's copper hedge protection continues to provide stable operating margins at the Gibraltar mine. Copper prices in the second quarter averaged $3.84 (U.S.) per pound, compared with the six-month, year-to-date average of $3.95 (U.S.) and the 2022 average of $3.99 (U.S.) per pound. The company currently has copper price collar contracts in place that secure a minimum copper price of $3.75 (U.S.) per pound for 35 million pounds of copper until Dec. 31, 2023.

The company's copper concentrate transportation was recently impacted by the strike action of port workers in British Columbia. The work stoppages by the port workers has delayed shipment of concentrate to customers. Now that the strike has been resolved, efforts are under way to move stockpiled concentrate at site to the port using rail and trucking. Given the backlog, concentrate inventory levels at site may not reduce to normal levels until later this year.

The company will host a telephone conference call and live webcast on Thursday, Aug. 3, 2023, at 11 a.m. Eastern Time (8 a.m. Pacific Time) to discuss these results. After opening remarks by management, there will be a question and answer session open to analysts and investors.

To join the conference call without operator assistance, you may preregister on-line to receive an instant automated call back just prior to the start of the conference call. Otherwise, the conference call may be accessed by dialling 888-390-0546 toll-free, 416-764-8688 in Canada or on-line through the company's website.

The conference call will be archived for later playback until Aug. 17, 202,3 and can be accessed by dialling 888-203-1112 toll-free, 416-764-8677 in Canada, or on-line through the company's website and using the entry code 191584 followed by the pound key.

We seek Safe Harbor.