Slide 1: Australia's leading magnetite producer
For personal use only Australia’s leading magnetite producer Russell Clark Managing Director & CEO January 2011
Slide 2: Disclaimer
Disclaimer For personal use only The material in this presentation (“material”) is not and does not constitute an offer, invitation or recommendation to subscribe for, or purchase, any security in Grange Resources Limited (“GRR”) nor does it form the basis of any contract or commitment. GRR makes no
Slide 3: Company Overview
Company Overview For personal use only ASX 300 index company Australia‟s leading magnetite producer Large integrated mine, concentrator, pellet plant and port facilities in Tasmania (Savage River) Savage River – 2-2.5mtpa, 16 year mine life Major magnetite development project in Western Au
Slide 4: Magnetite – The premium iron ore
Magnetite – The premium iron ore For personal use only Higher Iron Ore Pellet ~65-69% Fe Direct Shipping Lump ~63% Fe QUALITY Magnetite Concentrate ~67% Fe Lower Direct Shipping Fines ~58% Fe Lower Price Higher January 2011 Slide 4
Slide 5: Grange Board
Grange Board For personal use only Grange has a board with a diverse range of relevant experience. Xi Zhiqiang: Chairman Neil Chatfield: Deputy Chairman (Independent) Extensive experience in the Chinese steel industry Recently Executive Director and CFO of Toll Holdings, a position held Baoste
Slide 6: Company Snapshot
Company Snapshot For personal use only Board of Directors Current Ownership Structure Mr Xi Zhiqiang Chairman Mr Neil Chatfield Deputy Chairman Mr Russell Clark Managing Director, CEO 33.40 Free float Mr Zhao Hong Lin Executive Director 46.90 PML Mr Clement Ko Non Executive Director RGL Group Mr Joh
Slide 7: Market Capitalisation – Growth year on year
Market Capitalisation – Growth year on year For personal use only 1000 900 2009 2010 800 700 600 197% Increase 500 280% Increase 400 300 200 100 0 January 2011 Slide 7
Slide 8: Grange Resources – Australia's Leading Magnetite Producer
Grange Resources Australia’s Leading Magnetite Producer For personal use only Grange’s position is supported by quality assets In Tasmania and Western Australia. Southdown Project (70%) Savage River (100%) 90km northeast of the Northwest Tasmania Port of Albany Annualised production rate 650
Slide 9: Savage River Overview
Savage River Overview For personal use only Ownership Grange 100% Mineral Resource of 306Mt magnetite at 52.3% Resources DTR and Reserves Ore Reserve of 119Mt magnetite at 51.2% DTR 2.0 Mtpa blast furnace pellets (2011 guidance) Production Potential to expand to 2.6Mtpa Operating A$91/t
Slide 10: Large Scale Operations
Large Scale Operations For personal use only January 2011 Slide 10
Slide 11: Own Downstream Infrastructure
Own Downstream Infrastructure For personal use only January 2011 Slide 11
Slide 12: Own Port & Shiploading Infrastructure
Own Port & Shiploading Infrastructure For personal use only January 2011 Slide 12
Slide 13: Solid Customer Base
Solid Customer Base For personal use only Long term offtake agreements – providing revenue stability Agreements are in place for both Savage River and Southdown production at index based market prices. Shagang China’s largest private steel mill, producing 29Mtpa of pig iron Grange’s largest shar
Slide 14: Key Information December Quarter, 2010 vs 2009
Key Information December Quarter, 2010 vs 2009 For personal use only Production Production and Costs and Costs Dec Qtr 2010 Dec Qtr 2009 Total Mined („000 BCM) 3,972 5,414 Total Ore („000 BCM) 362 461 Pellets Produced („000 t) 442 640 Direct Operating Costs A$/tonne 91.37 63.83 Pellet Produced Notes
Slide 15: Southdown Project
Southdown Project High grade magnetite project with advanced infrastructure For personal use only Ownership Grange 70%, Sojitz Corporation 30% Resources and Mineral Resource of 654Mt magnetite at 36.5% DTR1,2 Reserves1 Ore Reserve of 388Mt magnetite at 35.5% DTR1,3 Targeting 10Mtpa magnetite
Slide 16: Growth - The Southdown Magnetite Project
Growth - The Southdown Magnetite Project For personal use only 4. Pellet Plant 3. Concentrate shipped 2. 100km slurry pipeline to Albany Port 1. Targeting 10Mtpa mining and concentrating operations for over 25 years January 2011 Slide 16
Slide 17: Southdown Resource
Southdown Resource For personal use only 654 MT at 36.5% magnetite January 2011 Slide 17
Slide 18: Southdown Super Pit Superimposed on Savage River photography
Southdown Super Pit Superimposed on Savage River photography For personal use only 3 Kilometres January 2011 Slide 18
Slide 19: Southdown Project
Southdown Project For personal use only January 2011 Slide 19
Slide 20: Project Infrastructure Power & Pipelines
Project Infrastructure Power & Pipelines For personal use only Collie Coal Pipeline Route Fired Power Proposed 330Kv Transmission Line Power Existing 132Kv Transmission Line Western Power Networks 330kv line from Muja (150MW capacity). EPA Assessed Interconnected to SWIS1 Transmission line e
Slide 21: Southdown Magnetite Project Schedule
Southdown Magnetite Project Project Schedule For personal use only 2010 2011 2012 2013 2014 Prefeasibility DFS and Detailed Design Power Dredge Port Albany Sourcing Funding Commitment Long lead Items (Mill, Transformer) Business Readiness & Project Execution Pre-Strip and Mine Establishment (Tails e
Slide 22: Southdown Infrastructure Port of Albany
Southdown Infrastructure Port of Albany For personal use only New Berth Location January 2011 Slide 22
Slide 23: Project Infrastructure Southdown & Albany
Project Infrastructure Southdown & Albany All key infrastructure in place or well advanced For personal use only Water Desalination plant near mine site – guaranteed supply Power Base load power supply available Power Transmission 330kV transmission line Concentrate Transport Slurry Pipeline
Slide 24: Project Permits – well advanced
Project Permits – well advanced For personal use only Mine Environmental permit Granted November 2009, amendment required in 2011 for 10mtpa Port permits Granted November 2010 Water Permit Desalination application in 2011 January 2011 Slide 24
Slide 25: Resources and Reserves 2010
Resources and Reserves 2010 Supporting Long Mine Lives For personal use only Grange has 764Mt of attributable Mineral Resources and 391Mt of attributable Ore Reserves. Mineral Resources (inclusive of reserves) Ore Reserves Tonnes Grade Tonnes Grade (Mt) (%DTR) (Mt) (%DTR) Savage River 4 Savage River
Slide 26: Production growth prospects
Production growth prospects For personal use only 10 9 8 Million tonnes 7 6 Southdown 5 4 3 2 1 Savage River 0 2006 2008 2010 2012 2014 2016 2018 2020 (Production shown is attributable to Grange) January 2011 Slide 26
Slide 27: Grange - The largest Producing Magnetite Company
Grange - The largest Producing Magnetite Company For personal use only Out of the numerous junior companies with magnetite assets, Grange is the only one in production. 2,000 As at 24th January 2011 1,800 2.13b 1,600 2.78b Marrket Capitalisation A$M 1,400 18.76b 1,200 1,000 800 600 400 200 - January
Slide 28: Current Focus and Future Milestones
Current Focus and Future Milestones For personal use only Position Savage River for long term sustainable production: – Replacement ball mill being installed February 2011 2012 – Replacement AG mills being purchased – Trucking fleet re-build underway – Reviewing options for Port Latta emissions re
Slide 29: Summary
Summary For personal use only Australia's leading magnetite & iron ore pellet producer Solid investor, customer and revenue base Extensive magnetite technical and operational expertise Strong balance sheet with strong cashflow forecasts Healthy mix of Cornerstone, Institutional and Retail
Slide 30: Key Contacts
Key Contacts For personal use only Primary contacts: Russell Clark Managing Director & Chief Executive Officer +61 8 9327 7901 managingdirector@grangeresources.com.au January 2011 Slide 30
Slide 31: Competent Person Statement
Competent Person Statement For personal use only Southdown Project The information in this presentation which relates to the Mineral Resources of the Southdown Project is based on information compiled by James Farrell who is a full-time employee of Golder Associates Pty Ltd and a Member of the Austr
Slide 32: Appendix A – Southdown Project
Appendix A – Southdown Project For personal use only Mineral Resource Estimate Classification Measured Resources Indicated Resources Inferred Resources Total Resources Tonnes (Mt) 219.7 210.3 224.4 654.4 DTC wt% 37.4 38.9 33.4 36.5 DTC Fe% 69.2 69.3 69.1 69.2 DTC SiO2% 1.72 1.94 2.07 1.91 DTC Al2O3%
Slide 33: Appendix B – Savage River
Appendix B – Savage River For personal use only Mineral Resource and Ore Reserve Estimates Mineral Resource Tonnes (Mt) Grade (%DTR) Grade Ore Reserve Tonnes (Mt) (%DTR) Savage-River Total Measured 86.4 54 Savage-River Total Indicated 131.9 53 Proved 50.6 51 Inferred 87.8 49 Probable 67.9 51 Total 3