CONTENTS GROWING SALT.4 WHO WE ARE.6 OUR SUSTAINABLE SALT CYCLE.8 HOW OUR SALT IS USED.10 HOW IT FITS TOGETHER.12 HOW WE WILL ACHIEVE SUCCESS
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1 OUR SALT BUSINESS
2 CONTENTS GROWING SALT...4 WHO WE ARE...6 OUR SUSTAINABLE SALT CYCLE...8 HOW OUR SALT IS USED...10 HOW IT FITS TOGETHER...12 HOW WE WILL ACHIEVE SUCCESS...14 IT IS UP TO US...16 DIAMONDS MINERALS IRON & TITANIUM SALT URANIUM SIMANDOU 3
3 HOW WE ARE BUILDING A SUSTAINABLE FUTURE We are proud that we grow salt in a sustainable way. We are fuelled by the sun and wind 99% of the energy we use comes from renewable sources. We are also building a more sustainable future for our business. In the last few years we have significantly improved our performance, and we have real momentum to build on. But there is still a lot to do as we build on our recent success. GROWING SALT We are becoming more productive moving more salt on every shift. We never risk anyone s safety for another tonne. It is just as important that we develop new ways to market our product in our key Asian markets. We need to stay ahead of our competitors in a challenging marketplace. We have set out exactly how each one of us can support our mission to be a profitable market leader, safely and efficiently producing salt that meets our customers needs. It is up to us to make it happen. Our biggest challenge is improving our productivity. And we will only achieve this through the commitment, innovation and collaboration of each and every one of us. 4 The Story 5
4 WHO WE ARE Lake MacLeod Port Hedland Dampier 10 million tonnes for export every year Over almost 50 years, we have grown to become one of the world s largest producers of solar salt. From our operations in the Western Australian Pilbara, we can produce approximately 10 million tonnes for export every year. We are the largest landholder in Rio Tinto, with 240,000 hectares across three sites. The hot dry climate and low rainfall allows us to harness the renewable power of the sun and wind for virtually all of our energy needs. Our production is shared equally between our three sites Dampier, Port Hedlead and Lake MacLeod with each one producing a similar amount of salt. This gives us great balance and flexibility. We are well placed to serve markets from the Indian Ocean to the Pacific, with key customers in Asia, as well as the Middle East and the US. Our early growth was fuelled by the chemical industry in Japan, Taiwan, the Philippines and Korea and these customers remain vital to us, as do newer markets like China. Lake MacLeod Lake MacLeod is our site with the greatest opportunity for future expansion. The brine in Lake MacLeod is 10 times saltier than normal seawater. Dampier Dampier is our largest operation, producing 4.2 million tonnes of salt yearly, and our washing technology which has enabled fewer impurities and minimal washing losses was developed here. Port Hedland Port Hedland covers over 9,000 hectares of operational area and has been designated an important bird area because it is home to several globally important shorebird species. 6 The Story 240,000 hectares across three sites
5 OUR SUSTAINABLE SALT CYCLE We have the only self-renewing mine in the whole of Rio Tinto. We use seawater and brine which replenishes itself. We will never reach the bottom of the sea s stock of salt! At every stage of the process we use natural processes and renewable sources of energy to move, grow and harvest the salt. We do not mine the salt we grow it. We are also conscious of the amount of water fit for drinking we use in operations. Wherever possible, we are looking to replace this with seawater. Stage 1: Sourcing our brines Stage 2: Harnessing the natural power of evaporation Stage 3: Growing salt crystals Stage 4: Harvesting and washing Stage 5: Shipping to our customers Our commitment to biodiversity We source seawater and brines from the pristine oceans that surround our operations. Our sites are located on the coast of the Indian Ocean and are bordered by national parks. The sun and wind evaporate the saltwater, concentrating the liquid. Once impurities (limestone, gypsum, nutrients) have been removed the brine reaches salting point, when it is saturated with salt. We also mine and market by-products like gypsum making the most of our resources. We then grow top-quality, chemical-grade salt (sodium chloride) in crystallising ponds, through further evaporation. Once 20-40cm of salt has been grown, harvesters gather the salt and load it onto road-train trucks to be transported for washing. Washing the salt removes any impurities, such as dust, gypsum, magnesium or potassium. The salt is then transported to export markets through our own deep-water ports in Western Australia. The rich diversity of shorebird species at all three of our sites means they are designated as globally-important bird areas. The inland saltwater ponds at Lake MacLeod are fringed by one of the largest inland populations of grey mangrove. This plant grows inland at only three places around the world. 8 The Story 9
6 HOW OUR SALT IS USED Where you can find our salt Our final product clean, white, coarse salt crystals is used by the chemical industry and food markets to make products vital for modern life. It is easy to take salt for granted, but the caustic soda, chlorine and soda ash it is used to produce make a massive difference to the everyday lives of people around the world. Plastics Detergents and soaps Glass Textiles and paper Nylon for rackets Food 10 The Story 11
7 HOW IT FITS TOGETHER THE RIO TINTO STRATEGIC FRAMEWORK Rio Tinto s Vision We aspire to be a company that is admired and respected for delivering superior value and for being the industry s most trusted partner. Following the direction set by Rio Tinto and the Diamonds and Minerals Product Group, we have a clear sense of where our business is heading: We aspire to be a profitable market leader, safely and efficiently producing salt that meets our customers needs. To achieve this, we know what we have to do. We have already done well We have achieved this by safely delivering what our customers want when they need it, and listening to our customers to act on what they want. We can continue to improve our quality further. We have built real momentum recently by improving our performance. Rio Tinto s mission: To deliver industry-leading performance and create sustained, long-term value for our shareholders. Rio Tinto s strategy: A simple competitive game plan which is to invest in, and operate, long life, low-cost, expandable operations in the most attractive industry sectors. Our strategic priorities help us focus on getting our company back on track. Improve our performance Strengthen our balance sheet Deliver results Diamonds & Minerals mission: Strengthened by our diversity we operate customer-focused, market-led businesses, where safety is our priority and each and every employee is proud to create superior value for all stakeholders from products that enhance quality of life. Diamonds & Minerals strategy: We operate safe, low-cost, demand-led businesses from mine to market. We create, shape and grow global markets for our products through integrated marketing strategies that create value for Rio Tinto and its shareholders. Invest in attractive assets in attractive industries Maximise profitability and cash flow Create sustainable value We need to continue to boost productivity To stay profitable and sustain our success, we need to reduce costs by finding innovative ways to improve productivity. The bottom line is that we need to find new ways to safely move more tonnes for every hour we work. Rio Tinto s operating model: At the heart of the Rio Tinto operating model are assets, which are managed by the Product Groups. A small headquarters sets the direction of the Group. Headquarters and product groups are supported by a discrete number of expert functions within central support. Shared services deliver value through efficient delivery of repeatable activities. Diamonds & Minerals operating model: We operate a streamlined Product Group centre that sets the tone for how we behave, how we operate, what we make, how we sell and ensure that we deliver value. Within this framework each business unit is accountable for running safe and efficient operations and delivering value in line with our strategy. Metrics: Our goal is to perform above the sector in all of our key performance measures. This means having the best performance on: total shareholder return; injury frequency and zero fatalities; cashflow; net debt; operating costs; profit margins; and return on capital. Underpinned by our core values: Integrity Respect Teamwork Accountability 12 The Story 13
8 HOW WE WILL ACHIEVE SUCCESS SAFETY WE ALL GO HOME SAFE PRIDE MAKING A DIFFERENCE QUALITY ALWAYS DELIVER THE BEST PRODUCTIVITY INCREASE AND IMPROVE VALUE THIS IS OUR BOTTOM LINE Everyone has a part to play in driving our success. These five core priorities guide us all in the decisions we make and the actions we take. They set out the standards we aspire to achieve and how we will reach our destination. Where we want to be Recognised as the safest business unit in Rio Tinto. An example to follow as a sustainable, low-impact business that is respected in our communities. How we will get there Support, develop and recognise safety leadership that is highly visible in our operations. Ensure we control critical risks by improving critical risk and hazard management. Work together to coach and develop our people. Strengthen our reputation by working with the community and traditional owners. Where we want to be Widely recognised as a committed, empowered, high-performing team. Highly skilled, safe, innovative and adaptable. How we will get there Put the values of integrity, respect, teamwork and accountability at the heart of how we work. Nurture and grow skills and leadership at every level. Inform and mobilise our people on our strategy and targets so everyone knows their role in achieving our priorities. Encourage innovation that makes us safer, more productive and more competitive. Where we want to be Respected market leader for quality. Using that leadership in quality and reliability to increase our value. How we will get there Build long-lasting, meaningful relationships with customers, founded on great quality and service. Develop a single standard of product specification across our business. Bring sales and marketing closer to operations through meaningful collaboration and contact. Where we want to be World-leading field growth efficiency and salt harvest efficiency. Leading our major market competitors on costs. How we will get there Single set of standards across our business in planning, production and how we use resources. Focus on waste elimination through standardising and simplifying systems, processes and technology. Embed productivity improvements as one business, to achieve business value. Where we want to be Recognised for creating mutual benefit in collaboration with stakeholders. Making the most of our resources through efficient asset management and spending. How we will get there Work with all of our stakeholders to create sustainable value for everyone. Act as owners of our business, making wise spending decisions and managing assets efficiently. 14 The Story 15
9 IT IS UP TO US It is up to all of us to achieve our ambitions. We have set out how we make decisions and act across our business. We all need to be clear on what this means for us as individuals and teams. Whatever level we are at, whoever we are, in the salt business we all make a difference. This is the way we work. It is the only way we will build a sustainable future for our business. What will you do to improve our business? 16 The Story 17
10 18 The Story 19
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