OZ MINERALS GLOBAL MAINTENANCE USG CONFERENCE AUGUST 2012 - - PowerPoint PPT Presentation

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OZ MINERALS GLOBAL MAINTENANCE USG CONFERENCE AUGUST 2012 - - PowerPoint PPT Presentation

OZ MINERALS GLOBAL MAINTENANCE USG CONFERENCE AUGUST 2012 WWW.OZMINERALS.COM DISCLAIMER This presentation has been prepared by OZ Minerals Limited (OZ Minerals) and consists of written materials/slides for a pre sentation concerning OZ


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AUGUST 2012 WWW.OZMINERALS.COM

OZ MINERALS

GLOBAL MAINTENANCE USG CONFERENCE

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OZ MINERALS • PAGE 2

DISCLAIMER

This presentation has been prepared by OZ Minerals Limited (“OZ Minerals”) and consists of written materials/slides for a presentation concerning OZ Minerals. By reviewing/attending this presentation, you agree to be bound by the following conditions. No representation or warranty, express or implied, is made as to the fairness, accuracy, or completeness of the information, contained in the presentation or of the views, opinions and conclusions contained in this material. To the maximum extent permitted by law, OZ Minerals and its related bodies corporate and affiliates, and its respective directors, officers, employees, agents and advisers disclaim any liability (including, without limitation any liability arising from fault or negligence) for any loss or damage arising from any use of this material or its contents, including any error or omission there from, or otherwise arising in connection with it. Some statements in this presentation are forward-looking statements within the meaning of the US securities laws. Such statements include, but are not limited to, statements with regard to capacity, future production and grades, projections for sales growth, estimated revenues and reserves, targets for cost savings, the construction cost of new projects, projected capital expenditures, the timing of new projects, future cash flow and debt levels, the outlook for minerals and metals prices, the outlook for economic recovery and trends in the trading environment and may be (but are not necessarily) identified by the use of phrases such as “will”, “expect”, “anticipate”, “believe” and “envisage”. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and may be outside OZ Minerals’ control. Actual results and developments may differ materially from those expressed or implied in such statements because of a number of factors, including levels of demand and market prices, the ability to produce and transport products profitably, the impact of foreign currency exchange rates on market prices and operating costs, operational problems, political uncertainty and economic conditions in relevant areas

  • f the world, the actions of competitors, activities by governmental authorities such as changes in taxation or regulation.

Given these risks and uncertainties, undue reliance should not be placed on forward-looking statements which speak only as at the date of the presentation. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, OZ Minerals does not undertake any obligation to publicly release any updates or revisions to any forward looking statements contained in this presentation, whether as a result of any change in OZ Mineral’s expectations in relation to them, or any change in events, conditions or circumstances on which any such statement is based. Certain statistical and other information included in this presentation is sourced from publicly available third party sources and has not been independently verified. OZ Minerals financial results are reported under International Financial Reporting Standards (IFRS). This presentation also includes certain non-IFRS measures including Underlying EBITDA, Underlying EBIT and Underlying NPAT. These measures are presented to enable understanding of the underlying performance of the Company without the impact of non-trading items such as impairment, impairment reversal and litigation settlement expense. Non-IFRS measures have not been subject to audit or review. The non-IFRS measures used throughout this document are defined in the appendix. All figures are expressed in Australian dollars unless stated otherwise.

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OZ MINERALS • PAGE 3

SOUTH AUSTRALIA PROMINENT HILL & CARRAPATEENA

  • Very favourable mining

jurisdiction.

  • Close to road and rail.
  • Grid power to site.
  • Water supply.
  • Export routes via Darwin and

Adelaide.

  • Highly competitive shipping

times.

  • Access to extensive, 8,000km2,

area of exploration ground in South Australia (including IMX JV ground).

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OZ MINERALS • PAGE 4

PROMINENT HILL SITE

  • Commissioned in

February 2009.

  • Flat terrain.
  • Fly in fly out workforce –

competitive rosters and conditions, employee agreement in place until July 2015.

  • Workforce of 1,200.
  • High standard

accommodation.

  • Current operation open pit.

TAILINGS DAM MALU PIT ROM PAD PROCESSING PLANT VILLAGE ANKATA DEPOSIT AREA NORTHERN WASTE DUMP SOUTHERN WASTE DUMP TAILINGS DAM MALU PIT ROM PAD PROCESSING PLANT VILLAGE ANKATA DEPOSIT AREA NORTHERN WASTE DUMP SOUTHERN WASTE DUMP

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OZ MINERALS • PAGE 5

PROMINENT HILL PRODUCTION & GUIDANCE

Product: High grade (~50% Cu), high quality, copper concentrate. Production 2011: 107,744t contained copper, 160,007oz gold. Production guidance 2012: Contained copper 100,000t to 110,000t. Contained gold 130,000oz to 150,000oz. Mine and Plant: Open pit, mine, crush, grind, flotation. Cash costs: Competitive C1 cash costs US70.4c/lb for 2011. C1 cost guidance 2012: US$1.10-US$1.20/lb.

(increase primarily as a result of underground mining)

Workforce: Approximately 1,200 (including contractors).

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OZ MINERALS • PAGE 6

PROMINENT HILL UNDERGROUND DEVELOPMENT

  • Production commenced at Ankata with

first stopes blasted in March 2012.

  • Full mining rates (1.2Mtpa) by Q3 2012 to

2015.

  • Average grade range for 2012 to be 2.3-

2.8% copper.

  • Annual mine production of 1.2Mt of high

grade copper ore contributing ~25,000t

  • f copper and ~ 12,000oz of gold in

concentrates.

  • Pre-production capital within 10% of

budget at $148 million. Now drilling from underground.

  • Decline extension to provide access beneath pit

completed by Q4 2012.

  • Under pit resource drilling 2012/2013.
  • View to add 1-3 years mine life from immediate near-

mine program.

  • Deeper infill drilling to follow with access.
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OZ MINERALS • PAGE 7 Resources 272.7Mt at 0.98% Cu, 0.7g/t Au for 2,678kt Cu, 6.3 Moz Au. Reserves: 72.3Mt @ 1.13% Cu, 0.64g/t Au for 818kt Cu, 1.48Moz Au.

For the full details of the Prominent Hill Mineral Resource and Ore Reserve Statement for 2011 go to http://www.ozminerals.com/operations/Resources--Reserves.html

2011 RESERVES & RESOURCES UPDATE

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OZ MINERALS • PAGE 8

OTHER FACTS – OZ MINERALS (PROMINENT HILL)

  • 130+ Indigenous employees on site at Prominent Hill
  • 20 percent of our workforce are women.
  • 57 Coober Pedy residents currently employed at site.
  • 240 Upper Spencer Gulf residents employed at site.
  • Over 250 now flying from Port Augusta.
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OZ MINERALS • PAGE 9

PROMINENT HILL – 2011 ECONOMIC CONTRIBUTIONS

  • Over $100 million spent on South

Australian contracts and services*.

  • Over $20 million on local and regional

contracts.

  • In 2011, over 20 local businesses were

employed at Prominent Hill.

  • Preferred crushing contract given to

Joint Venture partner with our Traditional Owners - developing business skills for life after mining.

* This does not include major contractor spend such as Thiess and Sodexo who employ people who predominately live in South Australia.

Graeme Thornton – GT Signs

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OZ MINERALS • PAGE 10

SPONSORSHIPS AND DONATIONS

  • $300,000 partnership with the SA RFDS.
  • Provision of copper and production costs for

SA artists to work with Copper as part of the SALA festival.

  • Support of Remote Isolated Children's

Exercise (RICE) $20,000 per year.

  • Support of School of the Air - three year

sponsorship package.

  • Sponsorship of local sporting initiatives

including the Coober Pedy Saints and local gymkhana's and race days.

  • Three year sponsorship package for “Sight

for All”- a program aimed at reducing eye disease in Indigenous communities.

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OZ MINERALS • PAGE 11

OUR EXPERIENCE – HOW LOCAL COMMUNITIES CAN BENEFIT FROM MINING

  • Up skill regional businesses in

tendering process and basic business skills.

  • Consider developing a single point
  • f contact for local suppliers.
  • Better linkage between skills

development and job opportunities.

  • Investment in school retention

initiatives leading to improved literacy and numeracy and sustainability of communities.

  • Communities need to think

strategically about how they can benefit from mining, and engage with miners on this basis.

Coober Pedy Area School Seedling Program

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OZ MINERALS • NOVEMBER 2009 • PAGE 12

AUGUST 2012 WWW.OZMINERALS.COM

OZ MINERALS

CARRAPATEENA

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OZ MINERALS • PAGE 13

CARRAPATEENA COPPER – GOLD DEPOSIT IN SOUTH AUSTRALIA

  • Acquired in May 2011.
  • 250km south-east of Prominent Hill.
  • Tenement package consists of over

1,070sq km.

  • Large IOCG deposit – similar to

Prominent Hill.

  • First drill results 1,060m @ 1.88% Cu.
  • An initial Inferred Resource of

203Mt at 1.31% copper, 0.56g/t gold and 270ppm U3O8 in the southern area of the Carrapateena deposit.

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OZ MINERALS • PAGE 14

CARRAPATEENA COPPER – GOLD EXPLORATION SOUTH AUSTRALIA

  • Native title agreement reached for

exploration activity.

  • Exploration camp complete.
  • Infill drilling of southern area continues.
  • Drilling to establish resource in

northern area.

  • Scoping studies* commencing.

 Mining options: sub-level open stoping, sub-level caving, block caving and hybrid.  Mining inventories and rates being developed.  Production schedules/early stage costs being investigated.

* These are early stage studies which occur before pre-feasibility and feasibility studies and any subsequent decision to mine.

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OZ MINERALS • PAGE 15

GEOLOGY

CAR051 Chalcopyrite Mineralisation CAR061 Bornite Mineralisation

  • A deep deposit with 500m of

sedimentary cover

  • Mineralisation starts at 500m

and extends to 1500m below surface

  • Complex hematite breccias

hosted in sericite-chlorite altered granites

  • Two high grade bornite pods

surrounded by a lower grade chalcopyrite shell

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OZ MINERALS • PAGE 16

CARRAPATEENA: DRILLING COMPLETED AND IN PROGRESS DURING Q2

  • Exploration works continue to

upgrade resource from inferred to indicated status.

  • 10 holes completed for a total of

16,360m.

  • Results continue to be encouraging,

in both inferred resource area and northern exploration target area and continue to confirm current model.

  • High grade mineralisation extending

beyond current resource envelope.

Chalcopyrite Zone Exploration Target Area April 2011 Inferred Resource Area April 2011 Bornite Zone Bornite Zone

DD12CAR091 DD12CAR093 DD12CAR088 DD12CAR089 DD12CAR085 DD12CAR084W2 DD12CAR092W1 DD12CAR090W1 DD12CAR086 DD12CAR087

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OZ MINERALS • PAGE 17

Upper Bornite Zone Lower Bornite Zone 100m @ 1.97% Cu, 0.60 g/t Au, from 643m 153m @ 1.91% Cu, 0.92 g/t Au, from 1,099m 824m @ 1.18% Cu, 0.59 g/t Au, from 729m

DD12CAR082 Looking West DD12CAR083 Looking North

CARRAPATEENA Q2 DRILLING RESULTS: DD12CAR082 & DD12CAR083 ASSAYS

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OZ MINERALS • PAGE 18

CARRAPATEENA: REGIONAL EXPLORATION

  • Reviewing the regional exploration data has

produced a number of high quality, drill ready exploration targets.

  • Logistics for drill testing regional targets

currently underway.

  • An ‘in-house’ ground gravity survey has

commenced to refine new targets prior to drilling.

Drill target Planned Gravity Completed Gravity

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OZ MINERALS • PAGE 19

THREE MINING OPTIONS

SUB LEVEL CAVING BLOCK CAVING SUB LEVEL OPEN STOPING

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OZ MINERALS • PAGE 20

MINING METHODS

Pillars are left between each front

Block Cave Lift 1 Extraction Level at 1000 m Block Cave Lift 2 Extraction Level at 1400 m Sub Level Cave Top down in 25m slices

Lift 1 500m (BC) Lift 2 400m (BC)

SLOS Front 1 SLOS Front 2 SLOS Front 3 SLOS Front 4 SLOS Front 5

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OZ MINERALS • PAGE 21

CARRAPATEENA: DECLINE DESIGN (SECTION VIEW)

  • OZ Minerals Board

approves Exploration Decline.

  • Commencement in early

2013 – Phase 1 includes, completion down to 625m for geotechnical testing by mid-2016.

  • Exploration decline will

continue to a depth of approximately 1,000m for further exploration access.

Geotechnical Level 1 West Exploration Access Drive Geotechnical Level 3 Geotechnical Level 4 Geotechnical Level 2 South East Exploration Access Drive Exploration Decline Approved by OZ Minerals Board Development Subject to Further Approval by Board

LEGEND

  • 3600RL-
  • 4100RL-
  • 4475RL-

5100RL

N

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OZ MINERALS • PAGE 22

  • In order to complete block cave feasibility study we need in situ

measurement of:  Rock mass characteristics (structures, joints, rock strength)  Rock stress conditions with depth  Hydrogeology  Plus additional resource drilling to depths greater than 1,500m

PURPOSE OF EXPLORATION DECLINE

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OZ MINERALS • PAGE 23

PERMITTING PROCESS

Stakeholder engagement

Retention Lease Proposal Stakeholder consultation Prepare proposal Publicly exhibit proposal Respond to stakeholder feedback Obtain approval Mining Lease Proposal Environmental Impact Statement

Stakeholder engagement

Stakeholder consultation Prepare proposal Publicly exhibit proposal Respond to stakeholder feedback Obtain approval

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OZ MINERALS • PAGE 24

Step 1 – Establish Baseline for Social and Environmental Aspects (Completed). Step 2 – Define Project Scope (Completed). Step 3 – Impact Assessment (Completed). Step 4 – Identify Control and Management Strategies (Following stakeholder consultation).

PERMITTING PROCESS - RETENTION LEASE

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OZ MINERALS • NOVEMBER 2009 • PAGE 25

AUGUST 2012 WWW.OZMINERALS.COM

OZ MINERALS

PRE-QUALIFICATION PROCESS

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OZ MINERALS • PAGE 26

What is Pre-Qualification?

 Objective Screen potential contractors to establish that they have the necessary technical, SHECMS and commercial capability to undertake potential Scope of Works.

Contractors

SHECMS ✔ Commercial Capability ✔

Potential Scope of Work

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OZ MINERALS • PAGE 27

What is Pre-Qualification?

 Commitment OZ Minerals has a commitment to protect the environment and ensure the health and safety of all personnel on site whilst also looking after the interest of the local community.

OZ Minerals Commitment

Protect the Environment Act in the Interest of the Local Community Ensure Health and Safety

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OZ MINERALS • PAGE 28

What is Pre-Qualification?

 Realisation OZ Minerals is meeting this commitment by monitoring and improving commercial, safety, health, environment, community (SHEC) industrial relations and quality standards whilst working with site contractors to ensure their compliance with these standards.

OZ Minerals Contractors

Safety Health Environment Community

Monitoring

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OZ MINERALS • PAGE 29

Why is Pre-Qualification so important?

Only Contractors who can demonstrate a strong commitment to OZ Minerals Standards will be permitted to work on site. Potential Suppliers that do not complete the Pre-Qualification Process, or fail to meet OZ Minerals Standards will not be invited to tender for any work at an OZ Minerals site.  Importance of Pre-Qualification We intend to evaluate and verify the compliance with the previously stated standards of all potential Contractors before they are permitted to participate in the tender process.

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OZ MINERALS • PAGE 30

How to get pre-Qualified?

Our strategy  Steps to Pre-Qualification

Documentation

  • Fill & Send Pre-Qualification Form to Kymlee Macdonald

kymlee.macdonald@ozminerals.com

Notification

  • Get Receipted Notification

Outcome

  • Receive Pre-Qualification Outcome in Next Fortnight

Re-Apply

  • If Application is Unsuccessful: Improve and Re-Apply
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OZ MINERALS • PAGE 31

What information is requested?

Our strategy  Information required for the Pre-Qualification documentation: Part 1 – Contractor Commercial Details Part 2 – S&H Performance Assessment Part 3 – S&H Management Systems Part 4 – Environment & Community (E&C) Management Systems Part 5 – Quality Part 6 – Employee Relations

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OZ MINERALS • PAGE 32

Part 1 - Contractor Commercial Details

  • Contractor Name
  • Contractor Contact Details
  • Type of Business

 Contractor Commercial Form includes:

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OZ MINERALS • PAGE 33

Part 2 - S&H Performance Assessment

Why invest?

 S&H Performance Assessment form includes:

  • WorkCover Levy from current and previous year including

Industry Rating

  • Injury History from current and previous years
  • Injury History with OZ Minerals from current and previous

years

  • Incident Frequency Rate from last year and previous year
  • General Comments about S&H performance
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OZ MINERALS • PAGE 34

Part 3 - S&H Management Systems

Why invest?

  • Provide evidence for each following items
  • Further response optional if AS4801 or OHSAS18001 certified
  • Provide evidence of S&H Commitment
  • Provide evidence of Management and Resources
  • Provide evidence of Risk Assessment Management

 S&H Management Systems form includes:

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OZ MINERALS • PAGE 35

Part 3 - S&H Management Systems

Why invest?

  • Provide evidence of S&H Standard
  • Provide evidence of Communication and Consultation
  • Provide evidence of Personnel and Training
  • Provide evidence of Hazardous Substances
  • Provide evidence of Transportation
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OZ MINERALS • PAGE 36

Part 3 - S&H Management Systems

Why invest?

  • Provide evidence of Systems of Work
  • Provide evidence of Management of Change
  • Provide evidence of S&H Assurance
  • Provide evidence of New Plant, Equipment and Process Design
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OZ MINERALS • PAGE 37

Part 3 - S&H Management Systems

Why invest?

  • Complete S&H Advisor Details
  • Provide evidence of Contractor Evaluation
  • Provide evidence of S&H Performance and Reporting
  • Provide evidence of How auditing is conducted and by

whom

  • Provide evidence of Emergency Plans
  • List and attach S&H Accreditations and Certifications
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OZ MINERALS • PAGE 38

Part 4 - Environment & Community (E&C) Management Systems

Why invest?

  • Provide evidence for each following items
  • Further response optional if AS14001 or ISO 14001 certified
  • Provide evidence for environmental management
  • Provide evidence for the Personnel & Training system in place
  • Provide evidence of How auditing is conducted and by

whom  E&C Management Systems form includes:

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OZ MINERALS • PAGE 39

Part 4 - Environment & Community (E&C) Management Systems

Why invest?

  • Complete E&C Advisor Details
  • List and attach E&C Accreditations and Certifications
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OZ MINERALS • PAGE 40

Part 5 - Quality

Why invest?

  • List and attach E&C Accreditations and Certifications

 Quality form includes:

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OZ MINERALS • PAGE 41

Part 6 - Employee Relations

Why invest?

  • Provide details about Workforce Profile
  • Provide details about Industrial Activity in last 5 years

 Employee Relations form includes:

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OZ MINERALS • PAGE 42

Part 6 - Employee Relations

Why invest?

  • Provide details about Employee Relations
  • Provide details about Practices
  • Provide details about Litigation
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OZ MINERALS • PAGE 43

What happens after Pre-Qualification documentation is submitted for review?

Why invest?  Once Reviewed : You may be asked to provide further information to support your Pre- Qualification submission prior to approval. Receive formal notice of your Pre-Qualification Status – Approved or Rejected.

Reviewing Result Provide Further Information

  • r
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OZ MINERALS • PAGE 44

What does Pre-Requisition approval mean to my business?

 Once Approved

  • Your company details will be recorded in a master bidder list.
  • When a suitable Scope of Works becomes available for tender, if your company

profile fits the work to be carried out, then you will be issued with a tender pack for submission.

  • Only Pre-Qualified companies will be asked to tender on work associated with

any of our OZ Minerals sites. Why invest?

Company Details Recorded Scope of Work Available for Tender Tender Pack Issued for Submission

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OZ MINERALS • PAGE 45

Are contracts & Pre-Qualifications transferable between sites?

 Transfers

  • Pre-Qualification are transferable between OZ Minerals mining Sites.
  • Contracts are not transferable between OZ Minerals mining sites.

Why invest?

OZ Minerals Carrapateena Pre-Qualification OZ Minerals Prominent Hill Pre-Qualification OZ Minerals Carrapateena Contract OZ Minerals Prominent Hill Contract

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OZ MINERALS • PAGE 46

Question and Comments

Why invest? Thank you !

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OZ MINERALS • NOVEMBER 2009 • PAGE 47

AUGUST 2012 WWW.OZMINERALS.COM

THANK YOU