Slide 1: Los Bronces Site Visit
LOS BRONCES SITE VISIT PATRICIO CHACANA, HEAD OF OPERATIONS LOS BRONCES Real Mining. Real people. Real Difference 1
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Disclaimer: This presentation has been prepared by Anglo American plc (“Anglo American”) and comprises the written materials/slides for a presentation concerning Anglo American. By attending this presentation and/or reviewing the slides you agree to be bound by the following con
Slide 3: Overview
OVERVIEW 3
Slide 4: What You Will See and Hear
WHAT YOU WILL SEE AND HEAR Assets Capabilities Returns A world class asset with Our people driving relentlessly A highly competitive business with significant endowment to best in class operational options that provide leverage to a optionality performance, innovation and fundamentally attractive ca
Slide 5: What You Will See and Hear
WHAT YOU WILL SEE AND HEAR Assets Capabilities Returns A world class asset with Our people driving relentlessly A highly competitive business with significant endowment to best in class operational options that provide leverage to a optionality performance, innovation and fundamentally attractive ca
Slide 6: Mine Site Overview
MINE SITE OVERVIEW LOS ANDES Location: 3500 masl, 65 km NE of Santiago Los Bronces Plant CODELCO El Soldado mine Andina Ventanas Port Chagres smelter District Las Tórtolas LB Los Bronces Viña del Mar plant Pit Colina Santiago Confluencia Plant Cathodes Plant Perez Caldera Facilities Perez Caldera Ta
Slide 7: What You Will See
WHAT YOU WILL SEE Infiernillo 5 CF Plant San Francisco Dump Casino 2 Infiernillo 7 LB Plant Donoso 1 Donoso 2 7
Slide 8: Los Bronces Leadership Team
LOS BRONCES LEADERSHIP TEAM Patricio Chacana Head of Operations Los Bronces William Henott Chris Gentle Andrés Jorge Rivera Federico Gonzalo Sebastián Safety and Mine Planning Córdova Plant Manager González Vivo Manríquez Blanco Occupational Manager Mine Manager Finance Infrastructure PMO & Health M
Slide 9: Los Bronces in Numbers (2018)
LOS BRONCES IN NUMBERS (2018) 1,669 Employees 12 Shovels Electrics Diesel Front Loader 7 4 1 232 Supervisors 9 Drills Electrics Diesel 2 7 KOM 930 56 1,893 Permanent contractors 69 Trucks KOM 960 CAT795 2 11 Key performance metrics (2018F) TRIFR(2) Mine Movement Copper production C1 Cost (c/lb) 0.75
Slide 10: A Transformed Business
A TRANSFORMED BUSINESS CONFIDENTIAL 11 10
Slide 11: Safety: Our Journey to Zero Harm
SAFETY: OUR JOURNEY TO ZERO HARM LTIFR TRIFR 3.5 10 TRIFR 9 3.0 LTIFR 8 2.5 7 6 2.0 5 1.5 4 1.0 3 1.55 1.55 2 1.30 0.5 1.10 0.95 0.90 0.55 0.65 1 0.40 0.42 0.0 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 YTD Sept 43% High Potential Incidents 62% Lost Time Incidents 48% Total Recordable Cases
Slide 12: Sustainability at the Heart of Our Business
SUSTAINABILITY AT THE HEART OF OUR BUSINESS Trusted corporate leader Thriving $ communities OPERATIONAL FEWER ACCESS TO GROWING EFFICIENCY SURPRISES RESOURCES RETURNS Healthy Improved Additional Positioned as environment productivity and development partner opportunities resource efficiency More con
Slide 13: Thriving Communities: Our Focus Areas
THRIVING COMMUNITIES: OUR FOCUS AREAS Education Livelihoods The challenge: Quality education is one of the major social The challenge: Increasing level of skilled employment in our challenges in Chile local communities Our vision: All children in host communities to have access Our vision: Decent jo
Slide 14: Emerge: Successful Programme Exported to Peru, Brazil & Botswana
EMERGE: SUCCESSFUL PROGRAMME EXPORTED TO PERU, BRAZIL & BOTSWANA Using our business expertise to help others… … with results that speak for themselves • Four levels of support designed to help with each stage of growing an emerging business • Training and mentoring 75,000+ Entrepreneurs supported si
Slide 15: Soy Técnico: Chilean Government Looking to Replicate
SOY TÉCNICO: CHILEAN GOVERNMENT LOOKING TO REPLICATE SOY TÉCNICO 19 schools in 13 districts ‘I’m a technician’ 1,500 students have benefitted APOYO MI COMUNIDAD 4 strategic partners ‘I support my community’ 11 collaborating entities • Soy Técnico, or ‘I’m a technician’, is a pioneering education pro
Slide 16: Environmental and Sectorial Permitting Process in Chile
ENVIRONMENTAL AND SECTORIAL PERMITTING PROCESS IN CHILE Overall permitting environment in Chile is managed by a number of agencies… … maintaining constructive relationships with each agency (and other stakeholders) is fundamental to our strategy Key areas of focus in the permitting process Glacier W
Slide 17: Los Bronces Is Facing Structural Headwinds
LOS BRONCES IS FACING STRUCTURAL HEADWINDS We are not immune from industry-wide supply challenges Average haulage distance (km) Strip ratio (ore + marginal ore vs. waste mined) 8.0 2.5 2.0 7.0 1.5 6.0 1.0 5.0 0.5 4.0 0.0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 2015 2016 2017 2018 2019
Slide 18: Anglo American Operating Model
ANGLO AMERICAN OPERATING MODEL A structured way of working to convert targets into discrete pieces of work, which is well-planned and scheduled to achieve the desired outcome PLAN DO CHECK ACT 18
Slide 19: Focused on the Key Value Drivers
FOCUSED ON THE KEY VALUE DRIVERS Mine Plant Drill Blast Load & haul Crush Mill Float & filter Percentage of 2018F direct cost base, Los Bronces = c.5% cost base 19
Slide 20: A Step Change in Mine Performance
A STEP CHANGE IN MINE PERFORMANCE… Reconciliation - % area compliance Main production phase extraction (ktpd) +21% +18% 97% 227 193 76% 2014 2018 Sep YTD 2014 YTD Sep 2018 YTD Sep 20
Slide 21: …With Improved Equipment Productivity
…WITH IMPROVED EQUIPMENT PRODUCTIVITY Shovel # 10 Performance (Mt) +62% 30.4 2018 • Double side loading increased to 80% • Best operator 80% • Shovel passes per truck 3.5 18.7 2019 Focus • Shovel payload • Time management FY 2014 FY 2018F 21
Slide 22: Significant Improvement in Plant Performance
SIGNIFICANT IMPROVEMENT IN PLANT PERFORMANCE Confluencia plant operating time (%)(3) Step change in molybdenum recovery (%) +3% 96.0 53% 93.4 92.7 93.1 Industry 92.0 average 44% 38% 85.8 35% Peer 1 Peer 2 Peer 3 Peer 4 CF 2014 CF 2018 2014 2018 YTD Sep LT 1 Plant LT 2 Plant 22
Slide 23: A Relentless Cost Focus
A RELENTLESS COST FOCUS $0.2bn of cost-out delivered since 2014 FY C0 cash cost base ($bn) 16% reduction in controllable costs ($m) 0.1 32 186 36 56 63 (0.2) 2015 2016 2017 2018 Accum. 0.1 (0.1) 1.1 1.1 2014 Inflation / FX Volume / Activity Cost out Commodity 2018F Input Prices 23
Slide 24: A Relentless Cost Focus
A RELENTLESS COST FOCUS A relentless cost focus has driven a lower C1 cost despite lower grades (c/lb) -17% 17 23 Controllable costs 11 182 Non controllable (Input prices 8 & higher activity) 154 150 2014 Inflation / FX Production Cash Cost 2018F 24
Slide 25: Key Areas of Opportunity
KEY AREAS OF OPPORTUNITY A commitment to delivering best in class operating performance Total material mined (Mt) Plant total treatment (Mt) +21% +21% 150 58 124 48 2018F Target 2018F Target Focus areas Extraction and • Targeting increase in mine extraction and development through capital equipment
Slide 26: To Deliver Enhanced Shareholder Returns
TO DELIVER ENHANCED SHAREHOLDER RETURNS Production (kt) C1 unit costs (c/lb) 171 ~365 350-365 330-360 310-340 ~150 ~150 308 2017 2018F 2019F 2020F 2021F 2017 2018F 2019F 26
Slide 27: A World Class Endowment
A WORLD CLASS ENDOWMENT CONFIDENTIAL 11 27
Slide 28: A Leading Mining District
A LEADING MINING DISTRICT Significant potential outside existing Reserves and Resources(1)(4) Bt Exploration Targets(1) 120 ~0.3%-0.8%TCu 100 80 69.0 60 51.0 40 29.0 20 0.52%TCu 0.60%TCu 35.0 18.0 24.0 ~1.5 ~7.4 0 Ore Reserves (1) Exclusive Mineral Exploration Exploration Exploration Resources(1) Ta
Slide 29: Ore Reserves and Mineral Resources
ORE RESERVES AND MINERAL RESOURCES Ore Reserve Estimates(4) Mineral Resource Estimates(4) (as at 31/12/2017) Exclusive of Ore Reserves (as at 31/12/2017) Anglo American (50.1%) Proved Probable Measured Indicated Inferred Bt %TCu Bt %TCu Bt %TCu Bt %TCu Bt %TCu Los Bronces 1.11 0.53 0.41 0.48 1.32 0.
Slide 30: Los Bronces – Significant Growth Optionality
LOS BRONCES – SIGNIFICANT GROWTH OPTIONALITY Current state Growth options Future state Production (2018F) • Abundant high grade ore Production Los Bronces ~365 ktpa Underground • Mine life extension to 2065 400-500ktpa • Permit submission in 2019 C1 Cost (2018F) • Reduced mine interference C1 Cost S
Slide 31: Los Bronces Underground
LOS BRONCES UNDERGROUND The Los Sulfatos deposit provides a lower cost, higher quality upgrading opportunity that would deliver a step-change in the competitive position of the asset Attractive economics Operational metrics(5) • Key focus on sustainability: • No impact on glaciers • No impact on pub
Slide 32: Los Bronces - Andina Interaction
LOS BRONCES - ANDINA INTERACTION A constructive pathway for future developments and value generation Los Andina Bronces • Strong collaboration between two mines • Operation Planning Framework for effective / efficient extraction is in place • Will result in significant cost savings for both mines in
Slide 33: Committed to Operational Excellence
COMMITTED TO OPERATIONAL EXCELLENCE • Significant progress on our journey to zero harm • Anglo American Operating Model implemented and delivering benefits • 2018 a step change in performance • Further performance improvements committed to increase competitive position • A world leading endowment wi
Slide 34: Appendix
APPENDIX 34
Slide 35: Footnotes
FOOTNOTES 1) Estimates as at 31 December 2017. Please refer to the AA plc Ore Reserves and Mineral Resources Report 2017 for the tonnes, grades and a breakdown of the classification categories. Los Bronces District figures include Los Bonces Mine as well as Los Bronces Sur and Underground Inferred R