Las Bambas Project Joe Albright - Project Director 18 September 2011

Transcription

1 Las Bambas Project Joe Albright - Project Director 18 September 2011

2 Agenda Project Overview Highlights Challenges Initiatives Schedule Site Photographs Nueva Fuerabamba construction camp

3 Project Overview Mt Cu Copper in resource Measured Indicated Inferred Description Location: Apurimac, Peru Ownership: 100% Mineral Resource: % Cu Concentrator: 140ktpd, 2 grinding lines Production: 400ktpa Cu for first five years, average over LOM 315ktpa Cu Approved capital cost: US$4.23 billion LOM: 18 years Crusher transported to site Project Status Project approved by Xstrata August 2010 ESIA approved March 2011 Engineering/Procurement 41% complete Commitments at $ 1.2 billion (on target) Nueva Fuerabamba urbanisation in construction (earth works) Site early works commenced H1 2011

4 Project location

5 Project location continued

6 Engineering highlights 60% Model Reviews completed Productivity better than budgeted Manhours under budget Power line, Railroad, and Port expansion engineering progressing Off-Site access roads design complete Primary Crusher 3D rendition Hazop Hazard & Operability Reviews (Hazop) on process plant completed Risk Assessments completed Las Bambas concentrator

7 Procurement highlights Major process plant equipment ordered (approximately 45% of equipment priced and committed) Structural steel, re-bar, and concentrate pipeline ordered (approximately 45% of bulks priced and committed) Batch Plant, Overland Conveyor, Truck Shop, Camps quoted and soon to be committed Crusher unloaded at site Access roads, power line, concentrate pipeline construction contracts awarded Mine fleet and equipment ordered Significant effort underway to commit majority of equipment and bulks by Q Ball Mill Shells delivered to storage

8 Construction highlights Earth works underway at Nueva Fuerabamba urbanization (450 homes, schools, medical clinic, police station, recreation facilities) Off-Site access roads (350 km new and rebuilt heavy haul roads) Early Works, includes: construction camps, laydown yards, batch plant, roads, power, water and communication Safety Observation Program Site manpower at 1,200 people HSE Observation Program Observations Executed Aug11 NFB 20% 80% Las Bambas NFB Las Bambas Safe Behaviours Risk Behaviours Off Site Access Roads Development

9 Typical risks Price escalation Steel (structural, plate and re-bar) Copper (wire, cable, motors, transformers) Petroleum and most related products such as rubber lining and belting Labour (engineering and construction) Resources in Peru Construction equipment Skilled labour Supervision and management Community interaction with project Environmental management Cultural sensitivity Mining conflicts in other parts of Peru (eg. Puno) Concentrate pipe unloaded at port Local residents support the project

10 Proactive mitigation of potential risks RSI Program (Replication, Synergies, Integration) to help mitigate escalation and save money Standard Concentrator, second application Master Agreements rapid procurement Extended Project Agreements from Antapaccay Accelerated procurement overall Replication Designs & Documents RSI Program Synergy Processes & Knowledge Integration People & Resources Alliance Agreements provides access to Resources World wide access Skilled team Construction equipment Personnel assignments Xstrata Bechtel Graña y Montero FL Smidth Siemens Suppliers Consultants Project Guidance Project Management Construction Mechanical Equip Electrical Equipment Master Agreements Specialist Engineering

11 Proactive mitigation of potential risks Social Programs and Community Interaction Employment (37% Locals) Training Supplier development (40 local contractors) Health, Safety, and Environmental initiatives Management Programs and Initiatives Change Management Risk Management Lessons learned from Antapaccay Project Heavy mining equipment early purchase and savings Build, Own, Operate initiatives Definitive Estimate H LTI Ytd total recordable injury frequency rate ene-11 feb-11 mar-11 abr-11 1 Assessment of Risks may-11 jun-11 jul-11 ago-11 sep-11 oct-11 nov-11 dic-11 Incidents Target Cum TRIFR 14% 25% 61% Risk level LTIFR

12 Advancing on schedule Engineering, Procurement, Project Services Santiago, Chile; Lima, Peru; and New Delhi, India (600+ people) ESIA approved March 2011 after 9 months Early works commenced in March 11 following ESIA approval Copper production to commence in H Activity 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 Engineering Interim engineering Detailed engineering Procurement Mills and crusher Other equipment Construction Off site infrastructure Site establishment Earthworks Plant, equipment and other Production Pre-stripping Commissioning and ramp-up Full production

13 Construction underway Mine Area Camp Pumamarca Area Camp Nueva Fuerabamba Camp for 2,000 construction workers

14 Conclusions Las Bambas is a low-cost, tier-one asset with a long-life and potential for expansion/extension Production of 400ktpa for first 5 years and 315ktpa average over LOM, plus gold, silver and molybdenum credits On schedule and budget 29% of budget committed ahead of construction phase with majority of equipment and bulks to be committed by year-end Benefits from important synergies with Antapaccay Project Major equipment, steel, pipeline pipe, and EPC services are committed Seeing price escalation in steel, copper, fuel, rubber and labour Mitigation measures include design reviews, change management control and early procurement initiative Fiscal stability agreement in place Grinding area 3D model extract Las Bambas community support

15 Questions?

16 Agenda Introduction Copper market update Xstrata Copper overview South American Operations Project Development South America Antamina and Collahuasi expansions Antapaccay Project Las Bambas Project El Pachón Project Agua Rica Project Conclusions Coffee break 16