Slide 1: Qatalum site visit
Qatalum site visit January 25-26, 2010 (1)
Slide 2: Table of contents
Table of contents Hydro – Jørgen C. Arentz Rostrup 3 Forward-looking statements Certain statements included within this announcement contain forward- Market update – Eigil Madsen 38 looking information, including, without limitation, those relating to (a) forecasts, projections and estimates, (b) st
Slide 3: Hydro
Hydro Jørgen C. Arentz Rostrup, Executive Vice President and CFO
Slide 4: Hydro's value proposition
Hydro’s value proposition • Leading integrated aluminium and energy company with global reach and attractive positions across the value chain • Upstream cost position to be improved by the world-class Qatalum smelter • Strong operational performance and cost focus • Financial discipline • Long-term
Slide 5: Business model
Business model Primary aluminium production Midstream, recycling Aluminium in products Primary Metal Rolled Extruded Energy Metal Markets Products Products • Revenue in NOK • Revenue in USD • EUR and USD • Margin business • Margin business • Cost in USD – alumina, business • Regional business • Loca
Slide 6: Market
1 Market (6)
Slide 7: Historic downturn in 2009
Historic downturn in 2009 World outside China % change YoY World ex China 24% 20% 16% 12% 8% 4% 0% 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 -4% -8
Slide 8: Imbalance reduced
Imbalance reduced World outside China Global ex China (annualized) kT 28 000 27 000 26 000 ~2.6 million 25 000 tonnes 24 000 23 000 ~2.1 million 25 % tonnes 22 000 21 000 20 000 19 000 18 000 nov. 07 des. 07 jan. 08 feb. 08 mar. 08 apr. 08 mai. 08 aug. 08 nov. 08 dec. 08 jan. 09 feb. 09 mar. 09 apr.
Slide 9: Mixed signals in markets and economy
Mixed signals in markets and economy • Risk of w-shaped recovery • Strong NOK • Sales volumes increasing • LME inventories at record level Hydro • Margins stable • Supply/demand imbalance • Relatively strong LME-price in USD • World GDP and IP growing • Strong equity markets (9)
Slide 10: Strategy
2 Strategy (10)
Slide 11: Solid measures executed in 2009
Solid measures executed in 2009 • Operating capital reduced by NOK 5.8 billion • Capital expenditure plans cut by 50% from 2008-level Hydro • Permanent and temporary workers reduced by 4 500 • Staff and support manning reduced by 30%, NOK 750 million in reduced manning and external costs • Significa
Slide 12: Further upstream improvements necessary
Further upstream improvements necessary Focus on lean smelter operations and operational excellence 2009* Alumina 29% C onversion cost 31% Target to reduce cash cost by 100 USD per tonne, representing 20% reduction in conversion cost C arbon 13% Power 27% * Includes only fully consolidated smelters
Slide 13: Ambitious plan to cut cost by 100 USD/tonne
Ambitious plan to cut cost by 100 USD/tonne 90% to be realized by end-2011 compared to 2009 100% • Accelerated operational performance 90% defined within Primary Metals 80% production management system: • Improved current efficiency 70% • Reduced power consumption 60% • Reduced anode consumption 50%
Slide 14: Primary Metal
Primary Metal Next steps in repositioning • Implement stretch targets for cost savings and operational performance at existing assets • Continued efforts on procurement initiatives • Production curtailments • Additional curtailments – if needed • No restarts before it makes financial and industrial
Slide 15: Metal Markets
Metal Markets Extrusion ingot and 3rd party primary Sheet ingot external Downstream Midstream casthouses Primary production Rolled products & remelters Extrusion Foundry alloys/Wire rod/ Ingot/scrap Ingot external Strategy • Increased business volume through limited asset investments • Optimized sou
Slide 16: Extruded Products
Extruded Products • Leading positions in Extrusion Eurasia and Building Systems • Strong entrepreneurial spirit, management culture and competence • Product quality and service excellence • Product innovation through strong customer relations • Performance management – operational excellence Underly
Slide 17: Building Systems
Building Systems Our way to energy neutral & surplus buildings • Strong multi-brand market penetration • World wide sales organization • High performing products • Selective acquisitions • Buildings of tomorrow • Energy saving • Energy gaining • 100% recyclable • Interactive with the user (17)
Slide 18: Rolled Products
Rolled Products • Strong position in foil, litho and automotive • Underutilization and overcapacity is an industry challenge • Strategy • Margin management and cash generation Underlying EBITDA NOK million • Focus production system on core assets 1 079 1 164 354 • High grading product portfolio 383
Slide 19: Energy
Energy Strategy Normal production capacity per region and terms • Expand solid captive power position • 0.5 – 1 TWh development potential 0.5 3.0 • Utilizing existing concession areas and infrastructure • Investment NOK 1.2 – 2.5 billion from 2011 onwards Telemark • Normal production today 9.4 Twh 2
Slide 20: Going forward
Going forward Upstream • Cost reduction Midstream • Margin management Downstream • Margin management • Capture possibilities • Cost control Working capital management Capital expenditures discipline (20)
Slide 21: Attractive upstream growth pipeline
Attractive upstream growth pipeline Qatalum 2 – aluminium CAP – alumina Hydro power smelter, Qatar refinery, Brazil developments, Norway • Potential for expanding • Joint venture agreement • Development potential Qatalum up to 1.2 million mt between Vale (61%), Hydro 0.5 – 1 TWh • Utilize next-gener
Slide 22: Qatalum execution
3 Qatalum execution (22)
Slide 23: Repositioning of Primary Metal
Repositioning of Primary Metal Primary aluminium production, 1 000 tonnes 2 000 1 920 1 800 Temporary 290 330 idled production 40 15 70 1 600 65 40 70 120 60 1 590 1 400 1 720 1 200 1 000 Production Hamburg Høyanger Stade Årdal Karmøy Production Ramp up Alouette Qatalum C apacity 2004 Søderberg Søde
Slide 24: Qatalum financing
Qatalum financing Project economics • First decile position on cash cost curve when in full operation Qatalum financing - USD 5.7 billion (100%) • Equity from owners 54% • Project financed 46% Project financing • Term of loan is 16.5 years from August 2007 • Installment profile adjusted for cash flo
Slide 25: Qatalum ramp-up schedule
Qatalum ramp-up schedule Production in 1 000 tonnes on 100% basis, annualized 600 500 400 300 200 100 0 1 2 3 4 5 6 7 8 9 10 11 12 (25)
Slide 26: Qatalum earnings
Qatalum earnings • Build-up costs in 2009 and Hydro’s share of underlying EBIT in NOK million into 2010 2008 2009 • Depreciated over ~20 years -16 -16 • Marginal tax implications -35 • At current forward prices - -62 • Earnings negative in 2010 -99 -91 • No dividend expected short term -125 (26)
Slide 27: Global metal sales from Qatalum in 2010
Global metal sales from Qatalum in 2010 Total 340 000 tonnes: 75% products & 25% standard ingot Planned routes Norwegian System Hydro‘s metal sourcing system Qatalum target markets Southern Barcelona Europe/ Lisboa Mediterranean Livorno/ Istambul Gaeta Izmir Southern US Midwest Europe/ Mediterranean
Slide 28: Financial flexibility
4 Financial flexibility (28)
Slide 29: Cash flow neutral first nine months 2009
Cash flow neutral first nine months 2009 • Significant reductions in YTD 2009 in NOK billion operating capital ~NOK 5.8 billion 6 realized in 2009 5 • Capital discipline – reduced 2.5 investments 4 3.5 • No dividend payment in 2009 3 • Qatalum investments 0.7 • Project financed in first half 2009 2
Slide 30: Capital expenditures
Capital expenditures NOK billion • ~80% of 2009-2010 investments 12.2 upstream ~10.2 • Sustaining capex ~NOK 2.5-3 billion annually • Qatalum • Project financed in first half 2009 ~5.3* • Equity contribution in Q3 – NOK 1.5 billion • Equity contributions from partners and project financing in Q4 • E
Slide 31: Sustaining capital expenditures
Sustaining capital expenditures Energy Extruded Products Primary Metal Rolled Products Primary Metal relining Metal Markets (31)
Slide 32: Financial position
Financial position NOK billion 10.8 8.7 Cash less 3.5 3.0 2.4 interest-bearing debt Dec 31, June 30, Dec 31, June 30, Sep 30, 2007 2008 2008 2009 2009 (0.8) (2.1) Adjusted net debt* (15.4) (19.2) (19.0) Dec 31, June 30, Dec 31, Jun 30, Sep 30, 2007 2008 2008 2009 2009 * Net interest-bearing debt in
Slide 33: Liquidity well covered
Liquidity well covered Available long-term credit facilities • EUR 750 million in bank facility maturing in 2012 • USD 1.7 billion in multi-currency revolving facility maturing in 2014 • Currently ~NOK 16 billion undrawn Qatalum investments • USD 5.7 billion project costs* (100%) • USD 2.6 billion p
Slide 34: Credit quality policy
Credit quality policy Maintain investment-grade rating Financial ratios over the business cycle – Hydro’s ambitions • Currently: BBB- (S&P), Baa2 (Moody’s), both with negative outlook • Funds from operations to net adjusted • Competitive access to capital and debt > 40% important for Hydro’s busines
Slide 35: Price and currency sensitivities
Price and currency sensitivities Aluminium price sensitivity +/- 100 USD per tonne NOK/USD sensitivity +/- 0.1 NOK 700 250 600 600 200 200 500 450 150 150 400 300 100 200 50 100 0 0 EBIT Net income EBIT Net income • Annual sensitivities • Aluminium price sensitivity is net of aluminium price indexed
Slide 36: Shareholder policy
Shareholder policy • Hydro aims to give shareholders competitive returns compared to alternative investments in peers • Dividend payout ratio* will average 30% over the cycle • Buyback of shares and extra- ordinary dividends • When earnings, liquidity position and capital structure allow • No divide
Slide 37: Hydro's priorities
Hydro’s priorities • Reposition upstream business • Execute Qatalum • Proactive corrective measures • Financial flexibility • Stay close to customers • Solid operations • Competitive shareholder returns • Dividend policy: 30% of net income over the cycle (37)
Slide 38: Aluminium market update
Aluminium market update Eigil Madsen, Head of Portfolio Development Primary Metal (38)
Slide 39: Aluminium price
Aluminium price 3 400 27 000 26 000 3 200 25 000 3 000 24 000 23 000 2 800 22 000 -60% 21 000 2 600 20 000 2 400 19 000 USD/tonne NOK/tonne 18 000 2 200 17 000 +80% 2 000 16 000 15 000 1 800 14 000 1 600 13 000 -48% 12 000 1 400 11 000 10 000 1 200 +50% 9 000 1 000 8 000 Jan.08 Feb.08 Mar.08 Apr.08
Slide 40: Base metals price index (USD) from Jan 1, 2009
Base metals price index (USD) from Jan 1, 2009 Index 300 250 200 150 100 50 09 9 9 09 9 9 09 09 9 10 09 9 9 -0 -0 -0 l-0 -0 -0 r-0 g- - n- n- n- b- ov ep ay ar ec ct Ju Ap Au Ja Ju Ja Fe O M N D M S Source: Reuters/EcoWin Copper Lead Nickel Tin Zinc Aluminium
Slide 41: Oil vs. aluminium (USD) from Jan 1, 2009
Oil vs. aluminium(USD) from Jan 1, 2009 Index 200 180 160 140 120 100 80 60 9 09 09 09 09 10 09 9 9 9 9 9 9 -0 -0 r-0 l-0 -0 -0 -0 n- n- b- n- g- p- ay ov ec ar ct Ju Ap Ja Ju Ja Fe Au Se O M M N D Brent 1-pos LME 3M Source: Reuters/EcoWin
Slide 42: Price development since December 1, 2009
USD/tonne 2 000 2 050 2 100 2 150 2 200 2 250 2 300 2 350 2 400 1.Dec.09 3.Dec.09 5.Dec.09 7.Dec.09 9.Dec.09 11.Dec.09 13.Dec.09 15.Dec.09 17.Dec.09 19.Dec.09 21.Dec.09 23.Dec.09 25.Dec.09 LME 3m USD 27.Dec.09 29.Dec.09 31.Dec.09 LME 3m NOK 2.Jan.10 4.Jan.10 6.Jan.10 8.Jan.10 10.Jan.10 12.Jan.10 14.
Slide 43: LME forward curves 2006-10
LME forward curves 2006-10 2800 2600 2400 LME USD/ton * 2200 2000 1800 1600 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 jan. 06 jan. 07 jan. 08 jan. 09 jan. 10
Slide 44: Still unbalance, but at a reduced level
Still unbalance, but at a reduced level Global ex China (annualized) 28 000 27 000 26 000 ~2.7 mill 25 000 tons 24 000 kT 23 000 ~2.1 mill 22 000 tons 21 000 20 000 19 000 18 000 mar. 08 mar. 09 okt. 08 okt. 09 nov. 07 des. 07 jan. 08 feb. 08 apr. 08 mai. 08 jun. 08 aug. 08 feb. 09 sep. 08 nov. 08 d
Slide 45: Stock development
0 1 000 2 000 3 000 4 000 5 000 6 000 7 000 Jan.08 1 000 tonnes Feb.08 Mar.08 Source: Reuters/EcoWin Apr.08 May.08 Jun.08 Jul.08 Aug.08 Sep.08 Oct.08 Stock development Nov.08 Dec.08 Jan.09 Feb.09 Mar.09 Apr.09 May.09 Jun.09 Jul.09 Aug.09 Sep.09 IAI inventories Oct.09 Nov.09 Dec.09 Jan.10 LME invento
Slide 46: Apparent (un)balance demand/production outside China
Apparent (un)balance demand/production outside China 1 000 tonnes 800 700 Stock increase/ 600 Net export 500 400 300 200 100 0 Stock reduction/ Net import (100) Jan Feb Mar April May June July Aug Sep Oct Nov Dec (200) (300) LME stocks IAI stoc ks Japanese Port stocks Net primary export to China Est
Slide 47: Chinese production at all-time high
annualised kT per month Source: CRU 9 000 10 000 11 000 12 000 13 000 14 000 15 000 16 000 17 000 18 000 nov. 07 des. 07 jan. 08 …and increasing feb. 08 mar. 08 apr. 08 mai. 08 jun. 08 China (annualised per month) China Consumption jul. 08 aug. 08 sep. 08 okt. 08 nov. 08 dec. 08 jan. 09 feb. 09 mar.
Slide 48: LME and Shanghai aluminium price
1 000 1 500 2 000 2 500 3 000 3 500 Jan.07 USD/t Mar.07 May.07 Jul.07 Sep.07 Nov.07 Jan.08 Mar.08 May.08 Jul.08 SHFE 3M (*incl VAT) Sep.08 Nov.08 LME 3M Jan.09 Mar.09 May.09 LME and Shanghai* aluminium price Jul.09 Sep.09 Nov.09 Jan.10
Slide 49: Arbitrage LME vs Shanghai aluminium price
Arbitrage LME vs Shanghai aluminium price USD/mt 3 M Prices 800 700 600 500 400 300 200 100 0 9 09 9 9 09 09 9 09 09 09 9 9 10 -0 l -0 -0 r-0 -0 -0 - n- b- n- g- p- n- ay ar ov ct ec Ju Ap Ja Ju Ja Fe Au Se O M M N D Difference SHFE - LME 17% VAT (LME) Freight (30 USD/t) Source: Reuters/EcoWin
Slide 50: China: swift response to market conditions and prices
China: swift response to market conditions and prices Limited imports of primary metal likely in 2010 1 000 tonnes 600 550 • Production curtailments 500 450 400 • Strategic government purchases – Net import 350 300 lifted inland prices, import 250 became profitable 200 150 100 • Government incentive
Slide 51: New production from green and brownfield projects coming on stream
New production from green and brownfield projects under construction is coming on stream Accumulated new capacity World ex China, Qatalum 1 000 tonnes 3 500 • 600 kT 3 000 Emal 2 500 • 700 kT 2 000 India 1 500 • ~ 1500 kT 1 000 • In addition we assume 300 kt unspecified creep by 2010, and 500 400 kt
Slide 52: Industry cost came down from 2008 to 2009
Industry cost came down from 2008 to 2009, currently the cost curve is moving up 3 600 Curtailed capacity Cost curve is currently moving up from 2009 3 200 levels as LME drives alumina price up. Energy 2 800 and other raw materials may follow Business Operating cost (USD/t) 2 400 2 000 1 600 1 200 8
Slide 53: 2010 balance – same view as shown at CMD
2010 balance – same view as shown at CMD World outside China 1 000 tonnes 2010 imbalance “handling” options: • Consumption upside (GDP, pipeline) 28 000 • Increased primary demand due to Production New capacity Demand increased scrap export to China 27 000 • Stock increase 2009 imbalance handled by:
Slide 54: Demand estimates world excluding China
Demand estimates world excluding China World outside China Demand 2009 Demand 2010 % million tonnes million tonnes CRU – January 20.4 22.3 9% Quarterly Alcoa – 4Q 21.4 22.5 5% presentation
Slide 55: Strong LME price in spite of sustained over production
Strong LME price in spite of sustained over production • High inventory levels • Availability of capital at low interest rates • A stable contango has financed stocks that are “locked in” until Q2/Q3 2010 • Strong inflow of investment money – No producers selling • Physical ingot premiums still elev
Slide 56: Price drivers for 2010
Price drivers for 2010 •High inflow of investment money •Restocking after crisis •Stocks “locked” in warehouse deals •Rising marginal cost •Commodities create expectations also for aluminium Current aluminium price •Still oversupply •Risk for “W”
Slide 57: Qatalum project
Qatalum project Tom Røtjer, Executive Vice President and Head of Projetcs
Slide 58: Qatalum location
Qatalum location Mesaieed Industrial City
Slide 59: Hydro history in Qatar
Hydro history in Qatar ● Qafco 1 in 1973 ● Qatar Vinyl Company in 2001 ● Qafco 2 in 1979 ● Qafco 3 in 1997 ● Qafco 4 in 2004
Slide 60: Qatalum a 50/50 joint-venture company
Qatalum a 50/50 joint-venture company Joint venture agreement 50% 50% z Gas supply z Technology and competence z Industrial climate z Metal marketing z Site & off-take z Project management Power plant and smelter
Slide 61: A new dimension aluminium project
A new dimension aluminium project Heads of agreement December 2004 Joint venture agreement March 2006 Investment decision October 2006 Final build decision July 2007 Production start-up Year-end 2009 Ramp-up During 2010
Slide 62: Key reference project - Sunndal 4
Key reference project - Sunndal 4 • Hydro technology used in Sunndal, further developed for Qatalum • Project execution, start-up and operations experience implemented in Qatalum • Personnel with experience from Sunndal key in Qatalum project
Slide 63: Qatalum project scope
Qatalum project scope Port Silos Cast house Pot rooms Power Plant Anode Construction plant Village 10.000 people
Slide 64: Global procurement
Global procurement Casthouse FATA/ K-Home HAL3000 Pot Control System Anode Baking Plant ABB FATA/ K-Home Service Areas & Potroom Building Pot Tending Machine SNC - Lavalin NKM Noell FTP & Dist. Systems Solios Busbars Power Plant Paste Plant Salztburger Al. Doosan Power Plant Solios General Electrics
Slide 65: 2007-2008 Crunch time
2007-2008 ”Crunch time” for project execution in the Gulf area
Slide 66: 2008 appears to be the crunch time for project workload in the GCC and Qatar
2008 appears to be the ‘crunch time’ for project workload in the GCC and Qatar GCC/Qatar Project Capex Workload 2007 - 2010 Qatar Workload Peak \ Implications for Qatar? \ a GCC Workload Peak a OQ Resources being diverted to Saudi Arabia and UAE = 40 4 where there is higher a g demand 3 = Q Lack of
Slide 67: First site office February 07, hail storm March 07
First site office February 07 Hail storm March 07
Slide 68: Qatalum site September 2007
Qatalum site September 2007
Slide 69: 10 million tonnes of landfill
10 million tonnes of landfill=200.000 truckloads Total driving distance ~20 million km 1500 truck loads pr day
Slide 70: June 2008 - piling
June 2008 - piling
Slide 71: June 2008 - 7200 people on site and increasing
June 2008 - 7200 people on site and INCREASING
Slide 72: 17 000 workers on site – January 2009
17 000 workers on site – January 2009
Slide 73: Construction village
Seemitarmaten ) Qatalum
Slide 74: Construction Village for 10 000 people
Construction Village for 10 000 people
Slide 75: Health, Safety & Environment – December 2009
Health, Safety & Environment – December 2009 Qa ta lum HSE s ta tis tic s Cons truc tion hours 5,0 4,0 3,0 2,0 1,0 0,0 des - jan- f eb- mar- apr- mai- jun- jul- aug- s ep- okt- nov - des - jan- f eb- mar- apr- mai- jun- jul- aug- s ep- okt- nov - des - 07 08 08 08 08 08 08 08 08 08 08 08 08 09 09 09
Slide 76: No. of cranes related to no. of observations
No. of cranes related to no. of observations 300 266 248 250 235 233 230 215 216 215 Number of Major/Critical or 200 182 Medium/Serious crane related obs. 148 150 100 82 No of cranes 61 61 64 49 47 50 37 39 38 36 33 31 30 28 26 15 1420 19 18 6 7 3 2 0 20 1 20 2 20 3 20 4 20 5 20 6 20 7 20 8 20 9 20
Slide 77: Overall progress by end December 2009: 95%
Overall progress by end December 2009: 95% December 7, 2009 Halfway there... Pot room installation
Slide 78: Qatalum completion: some 400.000 tags
Qatalum completion : some 400.000 tags THE HYDRO WAY !!!!!!!!!!
Slide 79: rb pp iogll
rb pp iogll ) Qatalum
Slide 80: Slide 80
Slide 81: Potroom building and fume treatment plant
2009-10-13 potroom building and fume treatment plant
Slide 82: hi py siogsl
09-10-26 hi py siogsl e) Qatalum
Slide 83: Carbon - Baking Furnace Tending Assembly
Carbon - Baking Furnace Tending Assembly Anode Baking furnace production: Paste Plant capacity 60 tonnes/hour of green anodes 340 000 anodes per year.
Slide 84: rb pp iogll
2009-10-26 rb pp iogll e) Qatalum
Slide 85: Silos with conveyor belt
2009-12-14 Silos with conveyor belt
Slide 86: 2009-09-27
2009-09-27
Slide 87: Start-up Potline 2 - December 16, 2009
Start-up Potline 2 - December 16, 2009
Slide 88: Qatalum power plant
Qatalum power plant EPC- Contractor: GE / Doosan EPC value: appr. 900 musd Power production Cap: 1350 MW Grid Connection: 250 MW Site: 252.000 m2
Slide 89: Qatalum Power Plant Open Cycle Operation
QP Fuel Gas Qatalum Power Plant Open Cycle Operation Gen ~ 219 MW GT 219 MW Gen ~ GT Gen ~ 219 MW GT Gen ~ 219 MW GT Aluminium Plant 220kV GIS 400kV Grid Connection 250 MW 220kV Distribution Rectifiers
Slide 90: Combined Cycle Operation
QP Combined Cycle Operation Fuel Gas Steam Turbine 1 Gen ~ HP LP Gen GT HRS G ~ SW Circ (88 000 m3/hr) Cond Gen ~ r SW Make- GT HRS Cooling Water Up (8025 G System m3/hr) Steam Turbine 2 HP LP Gen Fume Treatment Gen ~ (6165 m3/hr) GT HRS G ~ Cond r Gen ~ Power Plant Output GT HRS G z Max Power: ~ 13
Slide 91: Power plant 2009-10-26
Power plant 2009-10-26
Slide 92: Power plant
Power plant ea —
Slide 93: Power plant
lhe LY, Power plant
Slide 94: Qatar newspapers October 5, 2009
Qatar newspapers October 5, 2009
Slide 95: Key project success factors
Key project success factors ● Well-defined concept at time of decision ● Successful contract strategy and selection of contractors ● Interface management ● Sound risk management ● Active stakeholder management ● Strong HSE ambitions ● Project completion – “The Hydro Way”
Slide 96: Site canteen
Site canteen pe peel! e) Qatalum
Slide 97: Qatalum operations
Qatalum operations Jan Arve Haugan, CEO Qatalum
Slide 98: Qatalum Committed to deliver…
Qatalum Committed to deliver…
Slide 99: Qatalum Operations - January 26, 2010
Qatalum Operations - January 26, 2010 Background Organization development Start up of Operations Ramp up plan Qatalum going forward
Slide 100: Qatalum - Background
Qatalum - Background One relationship + two needs = Qatalum Background The context in which our business will make a difference Two fundamental needs have driven Hydro and QP to further deepen their 35+ year relationship: Qatar’s need to develop a modern and more diversified society beyond a relianc
Slide 101: Qatalum - A 50/50 Joint Venture
Qatalum - A 50/50 Joint Venture
Slide 102: A new dimension aluminium project
A new dimension aluminium project Heads of agreement December 2004 Joint venture agreement March 2006 Investment decision October 2006 Final build decision July 2007 Production start-up Year- end 2009 Ramp-up During 2010
Slide 103: Slide 103
Slide 104: Umm Sa'id
we Freres) Umm Sa'id
Slide 105: Qatalum
Qatalum
Slide 106: Qatalum
Qatalum
Slide 107: Qatalum
Qatalum
Slide 108: Slide 108
Slide 109: Slide 109
Slide 110: Qatalum project scope
Qatalum project scope Port Silos Cast house Pot rooms Power Plant Anode Construction plant Camp 10.000 people
Slide 111: MIC Facilities
Ba — Ye ist seapscsumauat, - ‘uit — c " - :: - ie MIC Facilities £ * (Departmenty ~~ . - om i ate Pass Office, IC Security Bldg. i 7 4 <~
Slide 112: MIC Infrastructure
(MIC Infrastructure (Department Bldg. (MIC \Port (Department
Slide 113: Qatalum organization
Qatalum organization CEO Jan Arve Haugan Internal Deputy CEO Auditor Hassan Al-Rashid HSE Manager HR & Adm CFO Carbon Reduction Casthouse Technical Power Ahmed Al-Kuwari Olaf Meissner Andrew Robbins Roald Holten Pål Vigeland Kurt Nilsson Steve Davison
Slide 114: Global Procurement
Global Procurement Casthouse FATA/ K-Home HAL3000 Pot Control System Anode Baking Plant ABB FATA/ K-Home Service Areas & Potroom Building Pot Tending Machine SNC - Lavalin NKM Noell FTP & Dist. Systems Solios Busbars Power Plant Paste Plant Salztburger Al. Doosan Power Plant Solios General Electrics
Slide 115: Qatalum's Global Family
Qatalum’s Global Family 12 5 1 1 61 26 1 1 4 8 201 3 21 5 1 18 2 74 328 1 1 69 1 1 9 1 45 92 1 6 1 1
Slide 116: No of Employees
No of Employees M 0 200 400 600 800 1000 1200 1400 ay -0 7 Ju l- 0 Se 7 p- 0 N 7 ov -0 Ja 7 n- 0 M 8 ar -0 M 8 ay -0 8 Ju l- 0 Se 8 Planned p- 0 N 8 Mobilization Progress ov -0 Employees Identified Ja 8 n- 0 Recruitment in Progress M 9 ar -0 M 9 ay -0 9 Ju l- 0 Date of Employment Recruitment Plan Vs
Slide 117: Mission, Values, Strategies and Governing Documents
Mission, Values, Strategies and Governing Documents The Qatalum Way Our Qatalum directives Qatalum policies • Code of conduct • Duty visits governing • Corporate social • Accounting documents responsibility • Etc. • Etc. Our Operational excellence • Entire value chain Mission Strategic • Continuous
Slide 118: Our Values
The Qatalum Values Our performance criteria Ethics Drive Relationships, Teamwork, Efficiency, Innovation Communication Our Respect Proactive We work in an open, We are driven to meet Values cooperative way. optimum standard while always seeking improvement. Ability Attitude Competence, Reliability M
Slide 119: A Comprehensive Training Program
A Comprehensive Training Program Qatalum Basic Course 2 days (Introduction, Qatalum Way, HSE, SOPs, Aluminium, Qatalum Plant) Leadership Course (Supervisors/experts) 4 days (Leadership, HSE, communication, cultural understanding, Qatalum Way Process training – alignment to Q SOPs) Power Plant Carbon
Slide 120: Growing international media interest with high level visits
October 2009 Growing international media interest with high level visits
Slide 121: First pitch vessel arrived at Qatalum's inbound dock
October 26, 2009, the first pitch vessel arrived at Qatalum’s inbound dock
Slide 122: Anode Handling and Storage
‘ rN en ee SFI = Ape Anode: Handling and Storage ay A cag "1 ~~ ae aa X i = . Xx
Slide 123: Rodding Anodes
Rodding Anodes “/s | ee: em Sp = n> Jl Ne] eC : 7A = 4 - yy < 7 “Ny
Slide 124: Dry out of Anode Baking Furnace
Dry out of Anode Baking Furnace at December 31, 2009
Slide 125: Qatalum Project and Management
Qatalum Project and Management
Slide 126: Potline 1 Team ready for Start up
Potline -1 Team ready for Start up
Slide 127: PTM Cranes at Potline 1
PTM Cranes at Potline 1
Slide 128: Slide 128
Slide 129: Slide 129
Slide 130: Cast house – Furnace
Cast house – Furnace Casthouse
Slide 131: First Foundry Alloy December 04, 2009
First Foundry Alloy December 04, 2009
Slide 132: Foundry Alloy ready for market
Foundry Alloy ready for market
Slide 133: First Export of Foundry Alloys
First Export of Foundry Alloys – December 18, 2009 First Export of Foundry Alloys Qatar National Day, December 18, 2009
Slide 134: First Extrusion Ingot January 22, 2010
First Extrusion Ingot January 22, 2010
Slide 135: Raw Material storage at Harbour Area
Raw Material storage at Harbour Area
Slide 136: Critical period ahead
Critical period ahead
Slide 137: Qatalum – competitive cost position
Qatalum – competitive cost position Business Operating cost (USD/t) 3,600 Curtailed capacity 3,200 2,800 2,400 2,000 1,600 1,200 800 400 Accumulated capacity World ex China (1000 t) 0 0 4000 8000 12000 16000 20000 24000 28000 BOC 2008 BOC 2009 2009 2010 2011 2012 2013 Source: CRU, BOC 2008: LME 2834
Slide 138: Qatarisation
Qatarisation Head of Qatarization Established 5 years intake plan Agreement with Qatar University Training & Recruitment Development Supervisor Professorship at QU Supervisor (Qatarization) "Aluminum Production Technology" Relationship with the high schools in Al-Wakrah Recruit 35 technicians from d
Slide 139: Qatalum Deliver as committed
Qatalum Deliver as committed
Slide 140: www.hydro.com
www.hydro.com