Rio Tinto Plc · LSE:RIO
Rio Tinto — CoalTrans South Africa 2006
21 slides from Rio Tinto's conference presentation, Mar 23, 2006
Slide 1: Seeking value creation through exploration
Tom Albanese Executive Director, Exploration & Group Resources “Seeking value creation through exploration ” CoalTrans South Africa Johannesburg March 23, 2006
Slide 2: Rio Tinto overview
Rio Tinto overview BHP Billiton 106.6 Rio Tinto 65.7 Anglo American 53.4 CVRD 50.4 Shenhua 29.0 Alcoa 26.3 • Second largest global mining company Barrick Gold 21.2 Newmont Mining 20.8 • Largest supplier of industrial minerals Xstrata 20.0 Norilsk 19.2 • Second in uranium and traded coal Anglo Platin
Slide 3: A broad geographic spread of operations
A broad geographic spread of operations Diamonds Aluminium Zinc, silver Talc Coal TiO2 / Iron and gold Iron Ore Talc Talc Talc Gold Coal Nickel Borates Copper Aluminium TiO2 Copper / Gold / Silver / Copper / Gold Molybdenum Iron ore Copper Uranium Diamonds Bauxite Iron ore Diamonds Salt Coal Copper
Slide 4: A leading position in many sectors
A leading position in many sectors Iron ore Energy – Coal & Uranium Industrial Minerals Aluminium Copper Diamonds 4 CoalTrans South Africa March 23, 2006
Slide 5: Rio Tinto Energy Product Group
Rio Tinto Energy Product Group Kennecott Energy (coal) Rio Tinto Coal Australia ERA (coal) Rössing (uranium) (uranium) In 2005 Rio Tinto’s coal businesses produced in excess of 146mt of coal Coal & Allied (coal) 5 CoalTrans South Africa March 23, 2006
Slide 6: Kennecott Energy Company (KEC) Assets
Kennecott Energy Company (KEC) Assets • Kennecott 3rd largest coal producer in US • KEC owns and operates five mines in the US • In 2005 KEC produced 116 million tons of coal • Coal supplies over 50% of US power needs 6 CoalTrans South Africa March 23, 2006
Slide 7: Rio Tinto Coal Australia (RTCA) Assets
Rio Tinto Coal Australia (RTCA) Assets • Largest exporter of thermal coal from Australia • Key markets include Japan, Korea and Taiwan • China also plays a key role • Premium coking coal producer • Total 2005 production of 38 million tonnes of coal 7 CoalTrans South Africa March 23, 2006
Slide 8: A leader in sustainable development in the energy market
A leader in sustainable development in the energy market FutureGen Project 8 CoalTrans South Africa March 23, 2006
Slide 9: Exploration strategy – the key to success
Exploration strategy – the key to success • Establish a clear objective • Prioritise, Prioritise, Prioritise • Focus on results, not process Pic de Fon, Simandou, Guinea • Collaboration with partners • Appropriate use of technology • Selection of the best team • Target quality Chapudi Coal 9 CoalTra
Slide 10: A predominantly geographic organisational structure
A predominantly geographic organisational structure Bristol Salt Lake City Reno Exploration Regions North America South America Perth Melbourne Africa/Europe Santiago Australasia Project Generation District Offices Region HQ Project Generation Industrial Minerals 10 CoalTrans South Africa March 23,
Slide 11: Rio Tinto African Assets
Rio Tinto African Assets Four African Businesses • Palabora (49% & Manager) • Richards Bay Minerals (50%) Simandou • Rössing Uranium (69%) • Murowa Diamonds (78%) Murowa Construction Project • Madagascar Mineral Sands (QMM) Rössing QMM Palabora Feasibility Study Richards Bay • Simandou Iron Feasibil
Slide 12: Rio Tinto Exploration – 2006 plan split by Geography
Rio Tinto Exploration – 2006 plan split by Geography FSU/ Asia/China Mongolia 6% Australia UK/EU 4% 16% 7% Russia USA 6% 13% Canada Africa 10% 16% Latin America 21% 12 CoalTrans South Africa March 23, 2006
Slide 13: Rio Tinto Exploration in South Africa
Rio Tinto Exploration in South Africa • RTE has been very active in South Africa since re-entering in 1998 • RTE has spent in excess of US$21m in that period • RTE was an early and vigorous supporter of the aims of BEE Chapudi Project – view west • RTE has looked to distinguish itself by investing i
Slide 14: Limpopo Coal Programme
Zimbabwe Botswana Limpopo Coal Programme Musina Musina 0 km 50 Polokwane Karoo Basin Rio Tinto Granted & Application Tenure RTME Collar Locations N Chapudi Project 0 Km 10 14 CoalTrans South Africa March 23, 2006
Slide 15: Typical sequence through Karoo stratigraphy in Chapudi area
Approximate Beaufort Thickness (m) TYPICAL SEQUENCE THROUGH Group 20 Marker Horizon KAROO STRATIGRAPHY IN CHAPUDI AREA 25 15 Seam 7 LEGEND 20 Gritty Sandstone - Fripp Formation Ecca Carbonaceous Shale Group Mudstone 40 Seam 6 Dull Coal (Seams 1,2,3,4,5,7) Bright Coal (Seam6) Diamictite 5 7 Seam 5 To
Slide 16: Chapudi cross section, +30km strike
Zimbabwe Botswana Limpopo Coal Programme Musina Chapudi Project 0 km 50 Polokwane N 0 Km 5 Cross Section strike +30km RTME completed drillhole Coal bearing mudstone Historic State collar location 16 CoalTrans South Africa March 23, 2006
Slide 17: Drill profile through centre of coal deposit
Drill profile through centre of coal deposit showing shallow nature, simple structure and flat dip S N Oxidised Zone Seam 7 Seam 100m 6 200m 100m Marker Horizon Mudstone Coal Seam 100m 17 CoalTrans South Africa March 23, 2006
Slide 18: Chapudi Project - Timeline
Chapudi Project - Timeline • 2006 – Infill drilling increases confidence in resource. Baseline environmental + social studies begin. Stakeholders engaged. • 2007 – Pre Feasibility begins. Significant portion of resource to measured status. Engineering studies completed. • 2008 – Full feasibility com
Slide 19: Soutpansberg Tenure
Soutpansberg Tenure • The Chapudi project represents a significant thermal coal opportunity. Based largely on converted rights - 70:30 JV Rio/Kwezi. • The JV moved swiftly to submit applications at the head of the queue for prospective ground to the east. Kwezi Mining has a 51% interest in these new
Slide 20: Rio Tinto & Kwezi Mining JV Structures
Rio Tinto & Kwezi Mining JV Structures • Two incorporated joint Ventures between Rio Tinto and Kwezi Mining covering coal opportunities: – Chapudi Coal (Pty) Ltd – Kwezi Mining 30% – Kwezi Mining Exploration (Pty) Ltd – Kwezi Mining 51% • Exploration funded by loans from Rio Tinto to start of feasib
Slide 21: Summary
Summary • The Chapudi Project is a very large coal resource that has the potential to help South Africa’s meet its future energy needs. • The project is excellently located with regard to key infrastructure. • Kwezi and Rio Tinto are together pursuing higher rank coals to the east and are looking to