Whitehaven Coal Limited · ASX:WHC
Whitehaven Coal — Investor Presentation (June 2011)
27 slides from Whitehaven Coal's investor presentation, Jun 15, 2011
Slide 1: ASX cover letter for Investors Presentation
For personal use only 15 June 2011 The Manager, Listings Australian Securities Exchange Company Announcements office Via ASX Online Dear Sir, We attach a copy of an Investors Presentation which will be delivered by the Managing Director today. Yours Faithfully Timothy Burt Company Secretary
Slide 2: Whitehaven Coal Limited Investor Briefing June 2011
For personal use only Whitehaven Coal Limited Investor Briefing June 2011
Slide 3: Disclaimer
Disclaimer For personal use only Statements contained in this material, particularly those regarding the possible or assumed future performance, costs, dividends, returns, production levels or rates, prices, reserves, potential growth of Whitehaven Coal Limited, industry growth or other trend projec
Slide 4: Qualifications and Statement
Qualifications and Statement For personal use only Information in this report that relates to Coal Resources and Reserves is based on and accurately reflects reports prepared by the Competent Person named beside the respective information. All these persons are consultants for Whitehaven Coal Limite
Slide 5: Whitehaven is the leading coal producer and developer in the Gunnedah Basin
Wh ite h a ve n is th e le a d in g c o a l p ro d u c e r a n d d e ve lo p e r in th e Gu n n e d a h Ba s in For personal use only ► Whitehaven recognised the value of Gunnedah Basin coal early and has built up a large resource base over 12 years ► Narrabri was the last large Exploration Licence
Slide 6: Investment highlights
In ve s tm e n t h ig h lig h ts For personal use only 1 Large resource and reserve base of high quality coal 2 High productivity mines & high yield coals provide cost and margin benefits Efficient and flexible opencut production base with significant growth 3 coming from Narrabri and Vickery 4 Incr
Slide 7: Large resource and reserve base of high quality coal
1 La rg e re s o u rc e a n d re s e rve b a s e o f h ig h q u a lity c o a l For personal use only ► Thermal and metallurgical coal resources of 1,750 Mt (100% basis) and reserves of 366 Mt (100% basis) ► Revised JORC statement released on 21 February 2011 ► Potential for continued increase in mar
Slide 8: High yield mines provide cost and margin benefits
2 Hig h yie ld m in e s p ro vid e c o s t a n d m a rg in b e n e fits For personal use only ► Average saleable coal yield of +90%, compared to an average of around 73% for Hunter Valley coals ► Currently 25% metallurgical coal, expected to increase to ~50% in future ► Average cash cost of ~A$60/t
Slide 9: Low-risk open cut production base with substantial growth from Narrabri UG and Vickery OC
3 Low-risk open cut production base with substantial growth from Narrabri UG and Vickery OC For personal use only ► Four OC mines with ~5.5 Mtpa1 SALEABLE PRODUCTION CAPACITY VS PORT capacity. OC growth from Vickery CAPACITY (100% BASIS) 1. 20,000 ► Saleable production capacity expected to be ~11.5
Slide 10: Increasing percentage of metallurgical coal production capacity
4 Increasing percentage of metallurgical coal production capacity - close to 100% export sales For personal use only MIX OF METALLURGICAL AND THERMAL COAL (100%)1 – UNCONSTRAINED BY PORT CAPACITY 20,000 18,000 16,000 Thousand Tonnes 14,000 Thermal 12,000 10,000 8,000 6,000 Metallurgical 4,000 2,000
Slide 11: Mix of off-take contracts and uncommitted tonnages
4 Mix of off-take contracts and uncommitted tonnages to manage market and production risks For personal use only ► Whitehaven has off-take commitments with Narrabri JV partners, but there remains significant uncommitted tonnage in the future ► The Vickery project offers a good mix of metallurgical c
Slide 12: Rail infrastructure to meet Whitehaven's growth
5 Ra il in fra s tru c tu re to m e e t Wh ite h a ve n ’s g ro wth For personal use only ► Whitehaven (60%) and Idemitsu (40%) sponsored CRIC and ARTC investments to meet the needs of Whitehaven and Idemitsu. This program is continuing ► Whitehaven and Idemitsu have rights to track capacity north o
Slide 13: Port infrastructure to meet Whitehaven growth
5 Port infrastructure to meet Whitehaven growth For personal use only ► Existing PWCS Terminal ► Whitehaven has 3.6 Mtpa of existing PWCS capacity under rolling 10 year contract ► Newcastle Coal Infrastructure Group (“NCIG”) – WHC owns 11% ► Stage 1 (30 Mtpa capacity) was commissioned in March 2010
Slide 14: Whitehaven's existing port capacity entitlement
5 Whitehaven’s existing port capacity entitlement For personal use only WHC - PORT CAPACITY BUILDUP 18,000 16,000 14,000 T4 12,000 Thousand tonnes Idemitsu TJV 10,000 NCIG Stage 2F 8,000 NCIG Stage 2AA 6,000 NCIG Stage 1 4,000 PWCS 2,000 0 1. These estimates relate to planned future events and expec
Slide 15: Growth plans are well funded
6 Growth plans are well funded Capacity to fund new opportunities For personal use only ► Cash on hand at end April of ~$180 million, with no finance debt other than equipment leasing ► Major committed capital is the completion of Narrabri Stage 2, which is well covered by cash on hand and remaining
Slide 16: Existing Operations - Expansion of opencut mines to 5.5 Mtpa in place
Exis tin g Op e ra tio n s - Exp a n s io n o f o p e n c u t m in e s to 5.5 Mtp a in p la c e For personal use only ► Werris Creek Mine (WHC 100%) Reserves to support 15 – 20 year LOM Permitted to 2.0 Mtpa PCI and thermal coals Saleable coal yield 100% Own crushing and rail load-out ► Ta
Slide 17: Existing Operations - Gunnedah CHPP and load-out upgrade complete
Exis tin g Op e ra tio n s - Gu n n e d a h CHP P a n d lo a d -o u t u p g ra d e c o m p le te For personal use only ► Gu n n e d a h CHP P a n d ra il lo a d - o u t (WHC 100%) ► Permitted to handle and rail 4.0 Mtpa saleable coal ► CHPP upgraded to handle planned 3.5 Mtpa saleable production fro
Slide 18: Narrabri underground mine – a world class asset
Na rra b ri u n d e rg ro u n d m in e – a wo rld c la s s a s s e t For personal use only ► Coal resources of 854 Mt in a single seam of 8-9 metres thick ► Current marketable reserves of 199.9 Mt based on extracting the bottom 4.2 metre section of the seam only ► Low ash, high energy, low sulphur P
Slide 19: Narrabri Stage 2 now developing for longwall
Na rra b ri S ta g e 1 n o w d e ve lo p in g fo r lo n g wa ll For personal use only ► First CM production 28 June 2010 ► Second and third continuous miners commissioned during the first half of FY 2011 ► More than 170 Kt of saleable coal produced to date ► Longwall installation due in February 201
Slide 20: Narrabri mining conditions are good
Na rra b ri m in in g c o n d itio n s a re g o o d For personal use only Development roadway - 5.4m wide x 3.5m high Overcast site within the 9m high coal seam 18 Investor Update June 2011
Slide 21: Narrabri Stage 2 progressing well
Na rra b ri S ta g e 2 p ro g re s s in g we ll For personal use only ► Longwall delivery is 86% complete ► Ventilation shaft, CHPP and other key Stage 2 facilities well advanced ► Stage 2 capital estimate of ~$300 million (100% basis) remains valid following award of most Stage 2 contracts 19 Inves
Slide 22: Future potential for top coal caving at Narrabri
Fu tu re p o te n tia l fo r to p c o a l c a vin g a t Na rra b ri For personal use only ► First 2 longwall panels will mine 4.2 metre bottom section & will provide experience of caving & geo-tech characteristics ► Potential thereafter for top coal caving (TCC) which could: ► Recover most of the 8-
Slide 23: Vickery a major strategic growth acquisition
Vic ke ry a m a jo r s tra te g ic g ro wth a c q u is itio n For personal use only ► The Vickery project area comprises Vickery, Merton, Bluevale and Canyon Extended ► 405 Mt of open cut Resources, with an initial open cut Marketable Reserve of 56.7 Mt ► Coal seams at Vickery contain a range of sem
Slide 24: Extension of the Tarrawonga JV has significant strategic benefits
Exte n s io n o f th e Ta rra wo n g a J V h a s s ig n ific a n t s tra te g ic b e n e fits fo r b o th p a rtie s For personal use only ► Utilises coal reserves within the Boggabri Coal area which would not otherwise be mined ► Extends the existing 70:30 Tarrawonga JV reserves to allow up to 3 Mt
Slide 25: Low-risk open cut production base with substantial growth from Narrabri UG and Vickery OC
Low-risk open cut production base with substantial growth from Narrabri UG and Vickery OC For personal use only ► Four OC mines with ~5.5 Mtpa1 SALEABLE PRODUCTION CAPACITY VS PORT capacity. OC growth from Vickery CAPACITY (100% BASIS) 1. 20,000 ► Saleable production capacity expected to be ~11.5 Mt
Slide 26: Looking further ahead
Lo o kin g fu rth e r a h e a d For personal use only ► Strong fundamental growth in demand for coal remains (both metallurgical and thermal) ► Whitehaven is well positioned ► Large resources and reserves of high quality coal ► Mix of metallurgical and thermal coal products ► Efficient, flexible ope
Slide 27: The recent corporate process
Th e re c e n t c o rp o ra te p ro c e s s For personal use only ► WHC received a number of unsolicited approaches in the second half of last year, to discuss potential corporate transactions, some of which could have involved a change in control ► The WHC Board decided that a formal process should