#1Anglo American MINAS-RIO INTERNATIONAL MEDIA VISIT - 2015 May, 2015 IRON ORE BRAZIL#2ANGLO AMERICAN: THE DIVERSIFIED MINER Diversified across 10 product groups that span the development cycle Founded in 1917 Key Headquarters Corporate & representative offices Iron Ore and Manganese Met and Thermal Coal Copper 150,000 employees and contractors Nickel Niobium and Phosphates Platinum Diamonds Operating across 5 continents Recognised in Brazil and internationally as a responsible mining company 2#3ANGLO AMERICAN IN BRAZIL A long and successful partnership Nickel Exploration Office Niobium Phosphates Nickel Iron Ore (Minas-Rio) о O Iron ore export terminal More than 40 years in Brazil Brazilian corporate office Phosphates 3#4BRAZIL: ECONOMIC AND POLITICAL SCENARIO A challenging set-up in spite of favourable conditions Selected indicators1 - - % Brazil OECD Modest growth due to tighter monetary and fiscal policies, weak external demand, low levels of investment and infrastructure bottlenecks; Brazilian environment GDP Growth 10 5 Inflation 10 6,5% 1,8% 2,3% 2,6% 5,4% 5,1% 5 1,8% 1,6% 1,9% • 1,4% 0,3% -0,7% -5 0 2010 11 12 13 14 15 2016 2010 11 12 13 14 15 2016 Unemployment rate Fiscal balance 10 7,3% 7,0% 6,8% 5 0 -3,9% -3,4%- 5 4,7% 5,1% 5,4% 0 -5 -10 -3,9% -3,1% -3,0% 2010 11 12 13 14 15 2016 2010 11 12 13 14 15 2016 Gross public debt currently at R$ 1,38 trillion -25% of GDP Sources: Datafolha Survey - March 18th, 2015 Democracy Quality, but scarce workforce Abundant mineral resources • Public demonstrations Low government approval Corruption scandals • Energy crisis Water shortage 4#540 (million) 35 0.38 28 26 18 14 5 2008 2009 2010 2011 2012 2013 2014 2 2015 2008 2009 2010 2011 2012 2013 2014 2015 Total Recordable Cases (TRCFR) MINAS-RIO: SAFETY AS A CORNERSTONE OF PERFORMANCE Benchmark Safety Performance = Leadership, Ownership and Accountability Man-Hours Worked 170m = Risk Change Management RCM = 96% High Potential Incidents HPI = 127 41 0.38 96% 85% 78% 0.23 31 0.31 0.23 0.22 0.23 0.21 0 2008 112 2009 2010 2011 2012 2013 2014 2015 2 25 14 42% 14 0 2011 2012 2013 2014#6MINAS-RIO: LARGE RESERVE & RESOURCE BASE Long-term value from a Tier 1 deposit with a fully integrated logistics . 2.8 Bt of Total Ore Reserves in addition to 2.6 Bt of Total Mineral Resources* Easy to mine material due to geological formation • Low strip ratio over LOM ~0.4:1 and easily liberates containments • Reserve life of 45 years ● Upside reserve potential from an already large resource base FRIABLE ORE ITABIRITE Mineral resources of 5.3 billion tonnes, including 2.8 billion tonnes of ore reserves *2014 Annual Report: Serra do Sapo - Friable Itabirite, Hematite and Itabirite estimates: Total Ore Reserves 2.8Bt @ 34.4% Fe in addition to Total Mineral Resources of 2.6 Bt @ 31.4% Fe 6#7MINAS-RIO OVERVIEW A fully integrated operational infrastructure from mine to port BENEFICIATION PLANT CONCEIÇÃO DO MINE PS MATO DENTRO 1 SANTO ANTÔNIO DO GRAMA MG PS PIPELINE VS TOMBOS RJ FILTRATION PLANT IRON ORE TERMINAL 7#8MINAS-RIO PROCESS - A fully integrated operational infrastructure – from mine to ship MINE PLANT PIPELINE FILTRATION IRON ORE TERMINAL . Life of mine is estimated at 45 years 30 trucks (230 t) Maximum productivity: 580 ton/h • 2 Shovels (22 m³) Productivity: 2100 ton/h . 1 shovel (26 m³) Productivity: 2500 ton/h • 4 Front end loader: (15 m³) Productivity: 1350 ton/h STRUCTURE Open pit operation *Available from 2016 onwards One 230kV transmission line DRY PROCESS STRUCTURES • Primary crushing Secondary crushing HPGR Dry process capacity: 55 MTPY (Wet basis) 4300 tons/h (wet basis) WET PROCESS STRUCTURE • • Primary grinding Flotation Regrinding Concentrate thickener Tailings dam Wet process capacity: • Primary grinding: 55 MTPY (wet basis) • Concentrate thickener: 26,5 MTPY (wet basis) • Concentrate thickener productivity: 3240 tons/h (wet basis) The longest slurry pipeline in the world (529 Km) Crosses 33 municipalities in 2 states (States of Minas Gerais and Rio de Janeiro) 68% of solids in the slurry Approximately 4 days for the slurry to travel the pipeline at 6 km/h avg) STRUCTURES 3 surface stations: 2 pumps stations 1 valve station Terminal station Capacity: • 26.5 MTPY (dry basis) 3000 tons/h (dry basis) Filtration plant located the Port One 138kV transmission line STRUCTURES • Concentrate Thickener • Clarifier water • revovery - Filtration (12 ceramic filters) Capacity: 26.5 MTPY (dry basis) • 3200 tons/h (dry basis) • Dedicated iron ore terminal (50:50 JV with Prumo Logistics) STRUCTURES · Stockpile • Stockpile Loading Ship size (cape size) Capacity: Stockpile: 1 Million tons • Stockpile Loading: 6,000 t/h Cape size Capacity of 180.000 tons* (wet basis) 8#9SHIPPED FIRST ORE ON 25 OCTOBER 2014 FOOS delivered safely and responsibly within revised plan and budget • First Ore on Ship two months ahead of schedule • • • Capital saving 0.4 billion $8.4 billion. Ramp-up: 18 20 months post First Ore on Ship 13 shipments to customers in China, India, Middle East and Europe (by end March) Production of 1.2 million tonnes (Q1 2015) • The team is well positioned to deliver ramp-up, safely, by Q2 2016 • ~4,000 employees (steady state) • • Diversified team with several years of mining experience Production guidance: 2015: 11-14 million tones 2016: 24-26 million tones * All tones on wet basis H 6#10A MAJOR ACHIEVEMENT Engineering complexity in an evolving environment BENEFICIAMENTO CONCEIÇÃO DO MATO DENTRO 33 MUNICIPALITIES 170,000,000 man hours worked SANTO ANTONIO DO GRAMA 35,600,000 m3 of earthworks 22 2m MG PEOPLE TOMBOS RJ TERMINAL DE MINERIO DE FERRO PORTO DO ACU 4,100 light vehicles + mobile equipments 4,000,000 km/month -700 New Y Heathrow 7 Burj Khalifa (Dubai) - Tallest building in the world. 32 FULLY FILLED WEMBLEYS Times London-New York 19,000 tons of steel 1,500,000 m of cables 3 1. PORTUGAL & SPAIN BORDER EIFFEL TOWERS 600,000 m3 of concrete poured 2 MARACANAS STADIUM PORTUGAL SPAIN 10#11MINAS-RIO VIDEO First Ore on Ship delivered in line with revised plan Minas-Rio 11#12COMPETITIVE OPERATING COST POSITION Lower Half of the Cost Curve FOB Cash Cost (post ramp up) 1st 18 yrs. Avg. (Real 2014 Terms wmt) Mine $10/t - $11/t Beneficiation $9/t 200 150 Pipeline $2/t Global Iron Ore Cost Curve - 2016 ($/dmt, FOB) . Minas-Rio in the 2nd quartile of the cash cost curve 100 Filtration $1/t Minas-Rio Net Port $5/t Other $6/t - $7/t $33/t $35/t (1) SIB Capex $5.5/t over 1st 18 years Note: (1) Includes state royalty, excludes federal royalty, on wet metric ton basis 50 0 0 250 500 750 1,000 1,250 1,500 1,750 2,000 2,250 Mt dry ore Source: CRU's estimate of FOB costs include mining, processing, transportation and general and admin. Minas-Rio shown at full production. 12#13HIGH QUALITY PELLET FEED PRODUCTS With the perfect fit for the evolving iron ore consumer market Alumina silica content 0% 2% 4% 6% 8% Australia Standard Quality Minas-Rio Increased market demand for high quality ore Minas-Rio Minas-Rio High quality pellet feed products Brazil North America • Direct Reduction - ~68% Fe Other Africa China . Kumba Iron Ore Blast Furnace - ~67% Fe CIS . India Low Silica and Alumina Australia High Quality 10% 56% 58% 60% 62% 64% 66% 68% 70% Fe content 1) Chinese production (rich ore equivalent) inferred from a small sample of mines Source: CRU, AME, Anglo American Minas-Rio products are priced on a basis. fully reflecting the excellent physical and chemical specifications 13 13#14THE FOCUS IS NOW ON SAFE RAMP-UP World-class performance and strong risk management Delivered project at $8.4 billion capex Product Ramp-up (Mtpa - wet basis) & FOB Cash Cost 0.9 7.5 8.4 0.4 8.8 LTD Feb15 2015/ 2016 Total project Saving Previous estimate Product (mt) 380 ~0.7 150 900 120 100 150 Port Pre Operations Mine & Ben Plan & Land Licensing, conditions and SG&A Other (1) Total 1) Includes working capital payments, demobilisation costs & construction contract finalisation -$60/t 24-26 $33-35/t 11-14 26.5 - Full | capacity $33-35/t 2014 2015 2016 2017 FOB ($/ wmt) 14 14#15STAKEHOLDER SUPPORT: EARNING OUR SOCIAL LICENCE Projects and initiatives focusing on the short, medium and long term requirements Education, Culture and Tourism Infrastructure and Access Health ▪ Local labour programme ■ Senai ■ Tourism support Environmental Management ■ Pavement works ■ Historical building renovation Global Programmes ■ Professional Training ■ NGO Partnerships ■ Clinics Renovation Local Economic Development ■ Fauna and Flora Rescue Archaeological and cultural heritage preservation ■ Conservation Units ■ ARPA for Life - UNGC ■ Local Supplier Development ☐ O Entrepreneurship Programmes 15#16WORKING TOGETHER There are no limits to what can be achieved if we truly work together OUR VALUES Safety Accountability Innovation Integrity Collaboration Care and respect CREATING THE RIGHT ENVIRONMENT % of Total Workforce 69 31 TOGETHER WITH THE COMMUNITY 100 19 81 • 474 students graduated to date • All of them from local communities Local Other IOB Female Male 1st Great Place to Work: #1 Large Company in Minas Gerais 31 Great Place to Work: #31 Large Company in Brazil . 347 (73%) hired by Anglo American Mechanic, Electrician, Mine Equipment Operators Welder, Operator, etc All of the Mine and Plant operations and maintenance employees have been hired from Senai 16#17Anglo American MINAS-RIO INTERNATIONAL MEDIA VISIT KOMATSU KOMATSU IRON ORE BRAZIL 830#18Anglo American MINAS-RIO INTERNATIONAL MEDIA VISIT APPENDIX - Social Licence to Operate IRON ORE BRAZIL 830 KOMATSU KOMATSU#19COMMUNITY DEVELOPMENT PROGRAMS Local Supplier Development Program PROMOVA Local Labour Development Program - MOVER Building Blocks Local procurement Operational efficiency increase Risk Mitigation Stakeholder Engagement AEIOU ■ Business development, financial support and professional qualification since 2012; 516 local suppliers supported, 130 companies participated in bidding processes; ■ Anglo American performed purchase processes Iwith more than 70 local businesses. ☐ ☐ Prepare the local population for entry into the labour market; Catalyst for local entrepreneurship; ■ Prioritize local manpower; ■ Contribute to local and regional economic development. 19#20INVESTMENT IN EDUCATION Information Technology Program ■ 30 information technology centres in Conceição do Mato Dentro, Alvorada de Minas, Dom Joaquin and Serro; ■More than 1600 people have benefited; ☐ Partners: Milplan, CMDNet, Enesa, ARG. Environment Education Programs Qualification in Tourism Conceição do Mato Dentro ■9100 pupils and 910 teachers in 49 schools across 5 municipalities have benefited; ■ Qualification of municipal school teachers in ecological activities; ▪ Distribution of educational booklets and theatrical presentations. ■ Partnership with SENAC; ■936 people qualified; ■ Broadcasting tourist attractions in Conceição do Mato Dentro, Serro, Alvorada de Minas and Dom Joaquim in the TV show "Viação Cipó". ■Building of education complex in the region of Conceição do Mato Dentro, consisting of: ■ Open University of Brazil (UAB) unit; Private school; ■ SENAI training centre. CIRCUITOS DO CONHECIMENTO CAPACITAÇÃO PARA O TURISMO UAB UNIVERSIDADE ABERTA DO BRASIL 20 20#21INVESTMENT IN CULTURE AND INFRASTRUCTURE Cultural tradition and Restorations Support cultural tradition and preservation in Conceição do Mato Dentro and Serro; ■ Heritage education; ☐ Qualification and management of social initiatives; ■ Restoration of two churches, Matriz (CMD) and Nossa Senhora do Rosario (Serro). Sanitation Recovery and extension of Sorting and Composting Unit in Dom Joaquim and Conceição do Mato Dentro; Building of UTC (Sorting and Composting Unit) in Alvorada de Minas; ■ Landfill site for integrated management of residues in Alvorada de Minas, Conceição do Mato Dentro and Dom Joaquim; ■ Water Treatment Station (ETA) for São Sebastião do Bom Sucesso and Itapanhoacanga. Public Infrastructure Donation of earthmoving equipment; ■ Donation of heavy equipment such as motor-graders, trucks and shovels for maintenance of local roads; ■ Maintenance and pavement of MG-010 highway. Health Care ■ Health care infrastructure in 3 municipalities: Contracting of health care professionals; ☐ • . • . • • • Provision of training and development; Monitoring of Health Care Programs; Epidemiology and population studies; Purchase of vehicles, medical equipment and hospital furniture. Conceição do Mato Dentro Expansion of clinic; Renovation of the Health Basic Unit of São Sebastião do Bom Sucesso (Sapo); Renovation of the Health Secretariat building; • Building of 9 clinics; Support the health care public service in the region. ■ Alvorada de Minas • Extension of Health Basic Unit of São José do Jassém; • Building of a new Health Basic Unit; • Building of a clinical analysis laboratory. ■ Dom Joaquim . • Building of a new Health Basic Unit in São José da Ilha; Refurbishment of Nossa Senhora das Graças Hospital. 21#22INVESTMENT IN THE ENVIRONMENT Fauna Monitoring and Flora Rescue ■ More than 950 fauna species were monitored; ■ Production of more than 350,000 native seedlings from native species. Fire awareness and prevention Partnership with the State Forest Institute (IEF) aiming to reduce fire incidents in the Espinhaço region; On-going monitoring with automated fire monitoring equipment from a new fire control centre, creation of fire brigades and fire prevention awareness campaigns; ■ Greater awareness of the toll free Fire Prevention number in case of fire incidents; ■ Environmental education for local communities. Forest and Environmental Compensation ■ More than 2,400 ha of forest compensation; ■ More than 2,400 ha of legal reserve; ■ More than 4,500 ha of Natural Heritage Private Reserve. Rescue and Reconstitution Program of Ferruginous Rupestrian Fields Strategic partnerships with renowned Brazilian universities to perform studies and support the work; ■ Rescue of rare and endemic species of ferruginous rupestrian fields; ■ 80% of successful introduction of native species. Anglo American Serra do Espinhaço Biosphere Reserve Science Centre Expected to become a regional hub for local environment and culture education, disseminating the biodiversity, speleology and archaeology studies conducted, in an interactive manner; ■ 4,000 visitors in the first year; ■Includes exposition rooms, a nursery, a butterfly vivarium, a multifunctional area, a rupestrian field garden and a laboratory. 22 22#23ANGLO AMERICAN BRAZIL - PARTNER IN THE FUTURE Four main initiatives with the objective of shared benefits IFC Best Practice Sharing Participation to IFC's Sustainability Exchange Forum ARPA For Life ■ Investment of US$5 million - disbursement from December 2014 ■ Unbundle social investments from operation and project footprint Anglo American to have a seat at the transition fund committee IFC International Finance Corporation WORLD BANK GROUP THE WORLD BANK United Nations Global Compact Signing up to the UN Global Compact - Brazil Chapter THE GLORA COMPACT UNIDAS HNACOES Pacto Global Rede Brasileira PN UD Empoderando vidas. Fortalecendo nações. FUTURO 00 REPUTAÇÃOMES LIDERANÇAINED EMPRESASZ SUSTENTABILIDADE A ENCONTRO ANUAL REDE BRASILEIRA DO PACTO GLOBAL 2014 4 DE NOVEMBRO SÃO PAULO Ministério do Meio Ambiente Governo Federal ARPA UNDP Dialogue on the Extractives Sector Participation in the Dialogue on the Extractive sector and Sustainable Development Anglo American intends to join the Working Group with other sponsors PN UD Empoderando vidas. Fortalecendo nações. IBRAM Votorantim agendapública CNI Confederação Nacional da Indústria Ministério de care Minas e Energia Embaixada Britânica Brasília GOVERNO FEDERAL BRASIL PAIS RICO E PAIS SEM PORREZA 23 23