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AN INTRODUCTION TO ANGLO AMERICAN Robert Craike, Peace River Coal Operations, General Manager Presentation to the 2013 Northeast British Columbia Community Coal and Energy Forum

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Page 1: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

AN INTRODUCTION TO

ANGLO AMERICAN Robert Craike, Peace River Coal Operations, General Manager

Presentation to the 2013 Northeast British Columbia Community Coal and Energy Forum

Page 2: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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ANGLO AMERICAN Anglo American is a global diversified miner with a market capitalisation of more than $70bn and interests in 45 countries

Global revenue

$33 billion USD

Operating profit

$10 billion USD

Global CAPEX

$5 billion USD

Project pipeline

$70 billion USD

Lost Time Injuries

50 per cent reduction Since 2007

Investing in reducing

carbon emissions Climate Change Strategy

Achieved

Gold Class Status Dow Jones Sustainability Index

Implementing

Anglo Social Way Leading social management system

Our economic contribution

Our social commitment

Employees

80,000 Permanent employees, and

50,000 Contractors worldwide

• External Affairs – Canada, Anglo American

Page 3: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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ANGLO AMERICAN METALLURGICAL COAL

Source: Annual Reports Excludes SSCC production.

• External Affairs – Canada, Anglo American

Scale 2nd largest Australian and 3rd

largest global seaborne

metallurgical coal producer

Operations • 5 in Australia

• 1 in Canada

Products • 15 Mt metallurgical coal

• 6 Mt export thermal coal

Our Seaborne Metallurgical Coal Position (Mt)

Europe 2 Mt

China 1 Mt

India 3 Mt

Asia 11 Mt

Total Production

20Mt

Total Production

1.4Mt

0

10

20

30

40

Xstrata Walter Rio Tinto Anglo

American Teck BHP Billiton

Source: Annual Reports & Quarterly Results Excludes SSCC production. All figures are attributable production 2011.

A GLOBAL COAL BUSINESS FOCUSSING ON PREMIUM HARD COKING COAL

Page 4: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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PEACE RIVER COAL INC.

Coal Tenure Hectares

Coal Leases (100% ownership) 4989

Coal Licenses (100% ownership) 36,931

Pending (100% ownership) 253,650

Coal Licenses (50% Joint Venture) 73,219

Pending (50% Joint Venture) 300

• 2006: Peace River Coal Inc. (PRC) formed

to manage the assets

• 2011: Peace River Coal Inc. becomes a

wholly owned subsidiary of Anglo American

plc.

Background and Tenures:

• External Affairs – Canada, Anglo American

Page 5: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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TREND MINE – CURRENT OPERATIONS

• The Trend Mine is a conventional truck and shovel open-pit operation and has been in operation since 2005.

• From 2005 to 2011, Trend averaged a production of 0.7 Mtpa of clean coal. In 2011 production was 0.9Mt.

• Decision taken in 2011 to incorporate Canadian operations into the Met Coal portfolio.

• In 2012, clean coal production reached 1.4 Mt. Our forecast for 2013 is 1.8Mt.

• The current mine operations are located in the northwest portion of the Extension Block (Phases 4 and 5) with mining activities in the South Block (Phases 1 to 3) nearing completion.

• At present the Trend Mine employs approximately 471 people with 21% female employees and 9% employees of Aboriginal descent

• External Affairs – Canada, Anglo American

Page 6: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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• Lost time injury frequency rates

PERFORMANCE IMPROVEMENTS – DOING THE BASICS RIGHT

0.00

0.50

1.00

1.50

2.00

2.50

2010 2011 2012 2013 YTD 2014Plan

2015Plan

2016Plan

LTIFR

LTIFR

• External Affairs – Canada, Anglo American

0

10,000

20,000

30,000

40,000

50,000

60,000

2009 2010 2011 2012 2013Annualised

Employee Productivity (units/FTE)

Actual Budget

Page 7: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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CURRENT TREND MINE OPERATIONS

Page 8: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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TREND MINE – CURRENT OPERATIONS Visual – 2013

• External Affairs – Canada, Anglo American

Page 9: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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TREND/ROMAN OVERVIEW

Page 10: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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ROMAN COAL MINE PROJECT Environmental Assessment Certificate #M12-02

• The Roman Project is located directly adjacent to

the existing Trend Mine and has three parallel

open-pits, to be mined in stages from west to east

• An Environmental Assessment Certificate for the

Roman Coal Mine Project was granted on

December 14, 2012 (Certificate #M12-02).

• External Affairs – Canada, Anglo American

Page 11: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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DELIVERING ON OUR COMMITMENTS

• Main issues identified through Environmental Assessment review (granted in December 2012) :

Potential effects to caribou and caribou habitat,

Potential water quality effects, specifically around selenium and nitrate

On Caribou:

Anglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company to secure its own tenures for the protection of caribou,

Anglo American has delivered $2.566 million funding for the South Peace Northern Caribou Plan

This is the largest contribution by a mining company for caribou mitigation measures under the Peace Northern Caribou Plan,

On Water Quality Effects:

Anglo American has started construction of the first water treatment facility in the Northeast of British Columbia

The facility addresses selenium and nitrate levels

Commissioning of the water treatment facility is expected by mid. 2014

• External Affairs – Canada, Anglo American

Page 12: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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PHASE 1 TREND-ROMAN MAPA - APPROVED

The Phase 1 Trend-Roman MAPA issue on August 7th approved:

• Timber clearing and grubbing for the construction of water management and sediment

control structures, access roads, and soil stockpile areas

• Construction of sediment ponds RP1 and RP2 to treat effluent from future mine

disturbances and associated stockpiled soil salvage

• Construction of collector ditches (RN1, RN2 and RN3) that feed RP1 and RP2 to

capture surface water flows from areas disturbed by the future Roman Phase 1 mining

activities

• Development of access roads to support the construction of the water management

structures

• Construction started in August, with Dunne-za Contracting (West Moberly First Nations)

• External Affairs – Canada, Anglo American

Page 13: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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TREND-ROMAN EARLY WORKS AMENDMENT

Page 14: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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PHASE 2 TREND-ROMAN MAPA – PENDING REVIEW

• The Trend-Roman Mine will mine 51.2 Mt run-of-mine of met coal (35.2 Mt, clean coal) at an average rate of 2.5 Mtpa from 2013 – 2029, effectively extending the mine life by 14 years.

• Mining will continue to progress in Extension Block, Phases 4 and 5, until 2015 when equipment will transition over to Roman. Extension Block mining will resume in 2023 and continue through end of mine (2029).

• This strategy was selected in order to take advantage of:

» Lower strip ratio

» Higher quality coal

» Lower production costs through this period of reduced coal prices

• The Trend-Roman Mine MAPA application was submitted for screening June 10, 2013.

Page 15: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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2013

• External Affairs – Canada, Anglo American

Page 16: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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2016

• External Affairs – Canada, Anglo American

Page 17: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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TREND-ROMAN PROJECT MINES ACT PERMIT AMENDMENT

2029

• External Affairs – Canada, Anglo American

Page 18: AN INTRODUCTION TO ANGLO AMERICAN River Coal Operations_2013_Presentation.pdfAnglo American had secured approx. 2,000 hectares of our tenures for caribou habitat – first company

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THANK YOU

External Affairs – Canada, Anglo American