Fortescue Ltd · ASX:FMG
Fortescue — Fortescue Metals Group — AJM 12th Annual Global Iron Ore & Steel Forecast Conference (March 2009)
15 slides from Fortescue's conference presentation, Mar 24, 2009
Slide 1: AJM 12th Annual Global Iron Ore & Steel Forecast Conference
24/03/2009 Julian Tapp Head of Government For personal use only Relations AJM 12th Annual Global Iron Ore & Steel Forecast Conference March 2009 Fortescue Metals Group DISCLAIMER - Important Notice The purpose of this presentation is to provide general information about Fortescue Metals Group Ltd ("
Slide 2: It's all about China
24/03/2009 It’s all about China For personal use only • Metals consumption is most closely correlated to the health off the Chinese C economy than those off the OECD Share of global consumption 35% 34% 27% 24% 25% 15% 13% 11% 9% 8% China US China US China US China US China US Steel Aluminium Copper
Slide 3: Beijing Airport
24/03/2009 Beijing Airport For personal use only From approval to completion in under 4 years • NDRC approved in March 2004 – put out for tender • Completed by end 2007 • Opened early 2008 • 902km2 + 2.5km of driverless train track + runway 3.8km x 60m • 43 million people per year • 1.8m tonnes of c
Slide 4: Outlook for China Iron Ore Imports
24/03/2009 Outlook for China Iron Ore Imports For personal use only • Stimulus package relatively steel intensive – Railways; airports; power grids – Bringing B i i fforward d iinland l d iinvestment t t • Domestic production exposed – Low head grade (15-25%) – Deep mines (some underground) – 120Mt
Slide 5: Chinese and Indian population migration
24/03/2009 Chinese and Indian population migration For personal use only Over the longer term, the fundamentals that drove the commodity boom still apply. Iron Ore Imports Source: United Nations, McKinsey, Macquarie Research , September 2008 Relative holding size FMG: 73,000 km2 Rio: 11,000 km2, (Ro
Slide 6: Meeting Asia's demand growth
24/03/2009 Meeting Asia’s demand growth For personal use only FMG Chichester Project Western CID Southern Pilbara Eastern Pilbara Exploration 5 billion tonnes in 4 years • Christmas Creek drilling commenced May 2004 • Cloudbreak commenced November 2004 • Solomon drilling commenced June 2007 • Reserv
Slide 7: Project Pipeline Underpinned by Geology
24/03/2009 Project Pipeline Underpinned by For personal use only Geology • The largest bedrock hosted iron ore discovery in Australia • Still potential upside in Chichester Range Area Robe resource Robe reserve HI reserve 3000 FMG resource 2500 HI resource 2000 million tonnes FMG reserve BHPB reserv
Slide 8: Key information
24/03/2009 Key information For personal use only 2H FY09 FY09 Q1 FY09 Q2 FY09 1H FY09 Mt Mt Mt / A$/t Mt / A$/t Mt / A$/t Forecast Forecast Tonnes Mined 1 7.099 8.463 15.562 ~ 23.800 ~ 39.000 Tonnes Processed 1 6.682 6.112 12.794 ~ 18.000 ~ 31.000 Tonnes Shipped 1 6.881 6.280 13.162 ~ 17.600 ~ 30.70
Slide 9: Overburden system at Cloudbreak
24/03/2009 Overburden system at Cloudbreak For personal use only Overburden system at Cloudbreak 9
Slide 10: State of the art rail operations
24/03/2009 Desand plant at Cloudbreak For personal use only State of the art rail operations Target: lowest cost transport in the Pilbara • Clean sheet design captures best of existing technology - Bigger carrying capacity, electronic braking system, aerodynamics • 40 tonne axle loads • Low centre o
Slide 11: State of the art port operations
24/03/2009 FMG’s new rolling stock, For personal use only ballast and fuel cars State of the art port operations Target: lowest cost transport in the Pilbara • Significant expansion area • Highly automated • Extensive use of conveyers • Largest g shiploaders p in Australia 11
Slide 12: Analysts prediction for relative operating costs
24/03/2009 For personal use only FMG’s second berth at Herb Elliott Port Analysts prediction for relative operating costs – Seaborne trade Iron Ore Cash FOB Costs for 2009 - Saleable Production by Company 90 Port Loading ellets 80 Royalty Cleveland-Cliffs: Pe Transport dry tonne in real terms US Ste
Slide 13: Debt maturity
24/03/2009 Debt maturity For personal use only Senior Secured Notes 1,200 US$ 1,026m 1,000 800 US$m 600 EUR$ 421m 400 US$ 318m US$ 250m 200 0 2009 2010 2011 2012 2013 2014 2015 2016 Long term repayment profile Where to from here? 13
Slide 14: Immediate focus
24/03/2009 Immediate focus For personal use only • Cost control • not necessarily job cuts; in some places too lean • but actually targeting ways to improve efficiency • Water management initiatives • Ramping up to 55Mtpa as quickly as possible • Shipping settlements • Not losing sight of expansion
Slide 15: Anderson Pt and SW Creek potential
24/03/2009 Anderson Pt and SW Creek potential For personal use only • 5 x Cape size berths • 3 x Shiploaders • 3 x Rail Loop • 3 x Train Un-loader • Easily expandable stockyard • Room for third party business For regular email alerts register online www.fmgl.com.au 15