Anglo American Plc · LSE:AAL

Anglo American — China Mining Conference 2007

19 slides from Anglo American's conference presentation, Nov 13, 2007

  1. Slide 1: Mining Industry Trends and Global Commodity Markets

    ‘Mining Industry Trends and Global Commodity Markets’ Presentation by Cynthia Carroll, Chief Executive Anglo American plc 13 November 2007 China Mining Conference

  2. Slide 2: Agenda

    Agenda ƒ Introduction to Anglo American ƒ The current dynamics of commodity markets ƒ The emergence of international Chinese producers ƒ Key supply constraints: - Skills - Energy - Infrastructure and logistics - Water - Community consent 1

  3. Slide 3: Anglo American - History

    Anglo American - History ƒ Founded in 1917 ƒ Opened up South African gold fields ƒ Grew to be Africa’s largest company ƒ Moved primary listing to London in 1999 ƒ Restructured to become focused mining company ƒ 150,000 employees and permanent contractors ƒ Active in 40 countries 2

  4. Slide 4: Our Businesses

    Our Businesses Anglo American plc Platinum Gold Diamonds Coal Base Metals Industrial Ferrous (75% of 17% of (45% of 100% 100% Minerals Metals Anglo AngloGold De Beers) 100% 100% Platinum) Ashanti (67% of Kumba Iron Ore; (shareholding 49% Minas-Rio project Brazil; being 100% Scaw Metals) progressivel

  5. Slide 5: Anglo Projected Expansions

    Anglo Projected Expansions Project Pipeline* $8-9bn ƒ $8.2bn of approved projects ƒ c.$20bn in brownfield and greenfield unapproved $6-7bn projects – many forecast to be in 1st or 2nd quartile of $5-6bn $4-5bn cost curve ƒ Potential to*: - Double copper production of 655kt by 2017 - Double nickel pr

  6. Slide 6: Anglo American in China

    Anglo American in China Anglo Coal’s Xiwan Kumba’s Zinc Smelter Project in Shaanxi JV in Chifeng AngloGold Ashanti’s Tech coop with Gold Exploration Yankuang projects in Xinjiang, Qinghai, Gansu, Sichuan AA Rep. Office 2002 AngloGold Ashanti Office 2004 Anglo Coal Office 2003 Tarmac’s office DTC off

  7. Slide 7: Stronger for Longer

    Stronger for Longer 400 'Cycles' in Base Metals Prices Indexed with Start of Cycle = 100 350 NB - Nominal Money MSU – Anglo Base - 5.11.07/pMet2 Apr 2003 - indexed, 300 low = 100 Nov. 1972 - Nov. 1963 - Oct 2007 (nominal money) Apr. 1974 June 1966 Nov. 1986 - 250 Nov. 1993 - June 1988 Jan. 1995 200

  8. Slide 8: Industry Consolidation

    Industry Consolidation Top 5 Cu & Zn Mine Producers' % Share of Global Mine Output 60 % Of World Production Copper Producers Zinc Producers 50 40 Rio ZCCM Xstrata 30 Asarco Hindustan BHPB Zinifex P.Dodge O/Kump 20 Centomin Glencore Rio F'p McM M.I.M . Teck C. 10 Noranda Codelco Codelco Xstrata Teck

  9. Slide 9: Mine Project Capex Budgets

    % 0 20 40 60 80 100 120 140 Prominent Hill Lumwana Andina (70-90kt/d) Source Brook Hunt Gaby Sur One One Eight Northmet Mantos de La Luna Petaquilla Piedras Verdes Mirador Galore Creek Phoenix Reko Diq Boddington Quellaveco (end-2004 and early 2007) Salobo I Codelco Norte Exp Rio Blanco MSU - 26.6.0

  10. Slide 10: Estimated Reserves Keep Growing

    Estimated Reserves Keep Growing Reserves 2005 500 Global Mined Copper and Reserves 1950 - 2005 (Mt Cu) Reserves 400 1998 Mined 300 1950-98 200 Reserves Mined 1950 1998-2005 100 Mined 2005 0 Source: USGS, WBMS, Anglo MSU MSU - 15.2.06/Cu Reserves 9

  11. Slide 11: Recent Chinese International Investments on minerals and mining

    Recent Chinese International Investments on minerals and mining 10

  12. Slide 12: International Benchmarks

    International Benchmarks 11

  13. Slide 13: Supply Constraints

    Supply Constraints ƒ Skills ƒ Energy ƒ Infrastructure and logistics ƒ Water ƒ Community consent 12

  14. Slide 14: Skills

    Skills ƒ Skills shortages have emerged as major challenges ƒ Limited output of relevant technical graduates ƒ More interventionist approach at artisan level ƒ Chinese graduate recruitment ƒ Premium on in-career training and talent management ƒ Diversity/Women in Mining 13

  15. Slide 15: Energy

    Energy ƒ Generating capacity has lagged growth ƒ Energy in security becoming significant operational issue ƒ Increased scope for self-generation ƒ Efficiency and carbon intensity reduction targets FUTURGEN ƒ Growing scientific consensus around climate change ƒ Clean coal imperative ƒ Importance of g

  16. Slide 16: Infrastructure

    Infrastructure ƒ Rail and port bottlenecks impacting supply and financial results ƒ Governments need to keep their side of the bargain ƒ Infrastructure partnerships 15

  17. Slide 17: Water

    Water ƒ Demand growing – in parallel with development ƒ Reduced rainfall in some countries ƒ Potential source of conflict with other users ƒ Need to innovate - waste water - water conservation - production processes - water trading 16

  18. Slide 18: Community Consent

    Community Consent ƒ Mining generating fewer jobs for local people ƒ Community consent increasingly important ƒ Mishandling of community issues results in lost projects or major delays ƒ Need to evolve new benefit sharing models 17

  19. Slide 19: Conclusions

    Conclusions ƒ Economic conditions remain strong ƒ Demand for major metals robust: stocks low ƒ China’s new international players – key partners ƒ Supply side constraints likely to continue ƒ Sustainable development considerations need to be integrated with core business planning 18

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