Len Jubber chief executive officer. Building momentum. Macquarie Securities WA emerging leaders conference 10 October 2007

Transcription

1 Len Jubber chief executive officer Building momentum Macquarie Securities WA emerging leaders conference 10 October 2007

2 Slide 2 BROKEN HILL (NSW) Spare mill capacity Potosi exploration decline Flying Doctor feasibility study North Mine Deeps pre-feasibility Study Near mine exploration Regional exploration COMMODITY MARKETS Exposure to zinc, lead, copper Re-position offtake arrangements ORGANIC & NEW BUSINESS GROWTH Growth platform: Strong earnings Strong balance sheet. Two year revenue protection Org structure geared for growth FLINDERS (SA) Stockpile 110 kt Zn at Beltana by Dec 2007 Cultivate off take market Commence direct ore sales by Dec 2007 Reliance feasibility study Regional exploration MOUNT OXIDE (QLD) Triple Cu resources to 300 kt Pre feasibility study in March Q 2008

3 Slide 3 Operating Projects Exploration Tampang (Cu, Au) Contained Metal Mt Mineral Resources Zinc Lead Copper Mount Oxide (Cu) Dee Range (Cu, Zn) Contained Metal Mt Ore Reserves Zinc Lead Beltana (Zn) Broken Hill (Zn, Pb, Ag) Potosi (Zn, Pb, Ag) Note : Cu as at 2007/08 Zn, Pb as at 2006/07 North Mine Deeps (Zn, Pb, Ag) Flinders (Zn)

4 Slide 4 250,000 Beltana High Grade & Intermediate Ore Flinders Resource Potential 200,000 Broken Hill North Mine North Mine Deeps Potential Contained Zinc (tonnes) 150, ,000 50,000 Broken Hill Southern Operations Reserves Potosi Resource Potosi Upside Broken Hill Southern Operations Resources & Upside onwards

5 Slide Zinc 5, Lead 4, Copper 10,000 LME Stockpiles (kt) ,000 3,000 2,000 1,000 Zinc Price (US$/t) LME Stockpiles (kt) ,000 2,000 1,000 Lead Price (US$/t) LME Stockpiles (kt) ,000 6,000 4,000 Copper Price (US$/t) 0 Oct 04 Oct 05 Oct 06 Oct Oct 04 Oct 05 Oct 06 Oct Oct 04 Oct 05 Oct 06 Oct 07 2,000 Broken Hill 13 th largest zinc mine Broken Hill 6 th largest lead mine : Mount Oxide: - high grade Near term exposure through the Flinders project Low capex growth path to top 10 zinc producer status - resource upside as focus in recent decades has been on zinc - leverage to upside through put options, down side protection - resource open in all directions - potentially low development threshold Tampang - Proven Cu/Ag porphry system

6 Slide 6 Annual zinc production by company (top 20) Xstrata Teck Cominco Glencore Zinifex Hindustan Zinc Anglo American New Boliden Minera Volcan Votorantim Industrias Penoles Perilya (including projects) Lundin Mining Corporation BHP Billiton Breakwater Resources Kazakhmys Oxiana HudBay Minerals Yunnan Chihong Metallurgy Perilya (current) Grupo Mexico Shenzhen Zhongjin Lingnan Omnium Nord Africain ,000 1,200 Annual zinc production ('000 tonnes per annum) Annual lead production by company (top 20) BHP Billiton Xstrata The Doe Run Company Teck Cominco Anglo American Glencore Minera Volcan Perilya Zinifex Hindustan Zinc Western Mining Industrias Penoles New Boliden Ivernia West Lundin Mining Corporation Shenzhen Zhongjin Lingnan Hunan Nonferrous Ind Yunnan Chihong Metallurgy Exxaro Resources ZGH Boleslaw Annual lead production ('000 tonnes per annum)

7 Slide 7 Basic EPS & dividends per share (cents) FY2005 FY2006 FY2007 Basic earnings per share Dividends per share

8 ! ASX: PEM Shares on issue: 196M Options: 4.3M Market capitalisation: A$823M (Undiluted at $4.20 per share) Average daily turnover: 1.1% (12 month undiluted average) (CENTS/SHARE) Oct Jan Apr Jul Oct Perilya share price vs zinc & lead price (LME Spot) PEM ZINC LEAD Geographic analysis of Share Register (Aug 2007) Slide 8 (US$/TONNE) KEY SHAREHOLDERS: AXA Group: 11.3% Barclays Global Investors: 9.0% Delta Partners: 5.5% Shares (m) Board & Employees: 2.1% 0 Australia UK North America Europe (ex UK) Asia New Zealand Unknown

9 " #$% Slide 9 Fifth anniversary since acquisition 642 Kt zinc, 298 Kt lead Five year mine life maintained since acquisition Experienced and resident workforce Investing $40 million in new projects and plant / equipment renewal in 07/08 Investing $12 million in exploration in 07/08 Largest mining lease holder in Broken Hill history

10 & & % Slide 10 In excess of 250 million tonnes mined at 13% zinc, 10% Pb, 115g/t Ag

11 Slide 11 Operating Southern Operations & North Mine Developing Potosi Underground Reserve (as at 30 Jun 2007) 6.7% Zn, 4.9% Pb, 50g/t Ag Resource (as at 30 Jun 2007) 11.7% Zn, 4.6% Pb, 54g/t Ag Production rate Mine life Ave annual metal production 1.9Mtpa 5 years 120 kt Zn 70 kt Pb 2 Moz Ag Project status (as at 30 Sep 2007) Flying Doctor Open Pit Resource (as at 30 Jun 2007) Project status Exploration decline 681.5m from portal 5.4% Zn, 7.1% Pb, 72 g/t Ag Feasibility study due Dec Qtr North Mine Deeps Redevelopment Resource (as at 30 Jun 2007) Project status 11.3% Zn, 13.5% Pb, 219g/t Ag Pre-feasibility study due Oct 2007

12 Slide 12 Southern Operations 1.9 Mt per annum North Mine Mt per annum Broken Hill Concentrator 2.8 Mt Capacity Potosi & Flying Doctor Mt per annum North Mine Deeps Mt per annum Satellite open pitable deposits?? evaluating existing ore feed North Mine Deeps Potosi & Flying Doctor North Mine Southern Operations

13 Slide 13 ' A$12M exploration budget 2007/08 Piesses Knob extend existing resources identify new satellite ore bodies major new discovery Potosi North Mine Round Hill Flying Doctor Stirling Vale Southern Operations 1130 Smiths City Mill Southern Ops Extensions 5 km Sam Deeds Henry George Perilya Broken Hill Mining Lease Surface projection of ore bodies Existing Operations Monarch Flat Exploration targets

14 ( ) * + #,-#$. /-0. Slide 14 Potosi Resource % Zn, 4.6% Pb 54 g/t Ag % Zn, 7.1% Pb 72 g/t Ag Resources

15 " 1 Slide 15 s 4.0% Pb/Zn 10.0% Pb/Zn 7.0% Pb/Zn Corporate Broken Hill Flinders Mount Oxide Investment

16 25% spare capacity in concentrator worth: $150 million in revenue US20 /lb zinc reduction in cash cost Continued incremental expansion of existing ore bodies: maintaining longevity maximising throughput T o n n e s (M t) Production, Reserves and Resources Remaining Mineral Resource Ore Reserve Cumulative Production Mar 02 Mar 03 Mar 04 Mar 05 Jun 06 Jun 07 Potosi Slide 16 Quantum change through discovery of substantial new ore body

17 ( ' 2 Slide 17 Rail line Tenements Rail line Tenements Existing infrastructure + direct high grade ore shipping + high Zn price = superior IRR

18 3**4 + /#. 5 6 /,, Leigh Creek Slide 18 Cluster of shallow deposits Currently mining Beltana Drilling along strike Operation Development targets Exploration targets Rail Road Relative scale of current resource 5 km Aroona Aroona II Tom Thumb Reliance Moolooloo Aristotle Beltana Mine Sundown Wallrider

19 Slide 19 Actual Plan 90,000 Contained (Zn) tonnes 80,000 70,000 60,000 50,000 40,000 30,000 Closing Stocks June 2008 Super High Grade kt High Grade kt Mid Grade - 9.7kt Low Grade - 6.7kt Very Low Grade - 4.5kt TOTAL - 77kt Very low grade 10-18% Low grade 18-25% Mid grade 25-30% High grade 30-35% Super high grade 35% above 20,000 10,000 - Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Separate stockpiling creates marketing opportunity

20 - Slide 20 Capital <$10M Zn = US$1.40/lb

21 Slide 21 Developing market options for 20% Zn high silicate product EARNINGS No additional Cap Ex Zn = US$1.40/lb

22 ( '7 Slide 22 Opportunity to compress timeframe through multiple offtake parties EARNINGS Deposit style open to repetition along 15km strike Zn = US$1.40/lb

23 8 9' 2 Slide 23 Mt Isa region Resource 4.0Mt at 2.8 % Cu Close to existing infrastructure Excellent drilling results 30.4m@ 5.2% Cu, 48ppm Ag and 426ppm Co $3.5m drilling budget to Dec 2007 Pre-feasibility study Mar Q 2008

24 8 9' Slide 24 Ivena Hematite Breccia +0.2% Cu Newly identified additional target zone (800m strike) Existing Resource

25 9 7 ' Slide 25 Haematite alteration outlines Plunge-line of alteration, grade and fold axis

26 Slide 26 Built stable platform for growth Relevant global producer with significant scope for volume and cash cost enhancement Two operating mines Strong pipe line of advanced, low capital intensive development projects Significant land holdings in world class mineralisation provinces Organisational capability aligned with growth model Top 20 zinc producer and top 10 lead producer

27 INVESTING IN SUSTAINABLE GROWTH