Fortescue Ltd · ASX:FMG
Fortescue — Fortescue Metals Group — Diggers and Dealers 2011
13 slides from Fortescue's conference presentation, Aug 3, 2011
Slide 1: Diggers and Dealers 3 August 2011
For personal use only Diggers and Dealers 3 August 2011 Disclaimer Important Notice The purpose of this presentation is to provide general information about Fortescue Metals Group Ltd ("Fortescue"). It is not recommended that any person makes any investment decision in relation to Fortescue based on
Slide 2: Delivering on promises
Delivering on promises For personal use only • Christmas Creek ore processing facility complete • Ramp up to 55mtpa achieved on time & budget • 155mtpa construction advancing strongly • Solomon Mine construction advancing rapidly • Exploration continues apace - 10 billion tonnes of resources – 1,000
Slide 3: Integrated business ~110mt shipped
Integrated business ~110mt shipped For personal use only Integrated infrastructure is the key 5 Heading here 6
Slide 4: Aboriginal training
Aboriginal training For personal use only • Fortescue VTEC trained/supported over 1,000 Indigenous people • Fortescue has 317 full time Aboriginal employees (10.5%) • Total indigenous employment with contractors 450 • Member of the Australian Employment Covenant • VTEC operates in South Hedland, Roe
Slide 5: Fortescue has the dominant Pilbara land position
Fortescue has the Fortescue: dominant Pilbara land 85,000km2 For personal use only Rio: 14,230km2 position BHP: 8,195km2 9 Resources growth in 2011 = 2 billion tonnes 12,000 10,000 es) Resources (Million Tonne 8,000 Western Hub 6,000 Nyidinghu Resource Magnetite Resource Solomon Resource 4,000 Chich
Slide 6: Proven project development skills
Proven project development skills For personal use only Completion records From concept To reality Herb Elliott Port Port 2006 2008 Fortescue Rail Railway 2007 2008 Mine Cloudbreak Minesite 2006 2008 FACT: Fortescue built its infrastructure faster than any other Australian mining company FACT: Forte
Slide 7: Ramp Up without Parallel
Ramp Up without Parallel For personal use only 50,000 45,000 Fortescue 40,000 Cloudbreak 35,000 30,000 Annual Production (kt) 25,000 20,000 15,000 Fortescue Christmas Creek 10,000 5,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 RIO Hope Downs RIO IOC (pellets and concentrate) RIO R
Slide 8: Marketing – index pricing transition
Marketing – index pricing transition For personal use only 180 Benchmark regime - FOB Index pricing - CFR 160 162 158 150 140 Average CFR selling price per dry tonne 130 A Average C1 costs t per d dry ttonne 125 US$ per dry tonne 120 100 80 83 72 69 70 60 66 58.5 49.4 40 45.6 35.4 38.3 30.1 32.3 28.
Slide 9: China and India are on the move
China and India are on the move For personal use only Commodity consumption growth at a rate not seen before • China has doubled sovereign wealth in only 10 years • India is joining the journey • Two countries with 2.5 billion people grew their GDP by over eight per cent last year • China consumes 5
Slide 10: Fortescue stock price performance
Fortescue stock price performance For personal use only Fortescue raises 10 billion tonnes US$1.5bn to fund total resources expansion Maiden reserve achieved at Solomon Hub 300 Refinance for rapid growth 4 Board approves 3 5 6 250 US$8.4bn expansion 2 200 1 Company closes US$600m unsecured 150 revol
Slide 11: Capturing the opportunity to 155mtpa
Capturing the opportunity to 155mtpa For personal use only Well Staged Development ACHIEVED: Christmas Creek OPF commissioned and Chichester Hub performs at targeted 55mtpa run rate NOW: Duplication of Christmas Creek OPF advancing well Chichesters to 95mtpa with first ore scheduled Sept Quarter 201
Slide 12: The Vision - Two Ports Three Hubs
The Vision - Two Ports Three Hubs For personal use only Chichester, Solomon and Western Port Hedland New Pilbara 155 Fortescue Infrastructure Port (Anketell) Dampier Fortescue Rail 200 Karratha Rio Tinto Rail BHP Rail Solomon Hub Chichester Western Hub 60 40 20 40 5 BCI JV Hub 50 60 40 40 Tom Price
Slide 13: Conclusion
Conclusion For personal use only • Christmas Creek ore processing facility complete • Ramp up to 55mtpa achieved on time & budget • 155mtpa construction advancing strongly • Solomon Mine construction advancing rapidly • Exploration continues apace - 10 billion tonnes of resources – 1,000 tenements •