BHP Billiton Iron Ore Asset Development Projects September 2003
Agenda Mining Area C Project Area C to Yandi Rail Project Products and Capacity Expansion (PACE) Project System Capacity Increases to 100Mtpa Long Term Expansion (LTE) Study 2
Port Capacity Expansion $650M Area C/Yandi Rail $160M Mining Area C $246M 3
MINING AREA C General Arrangement Complex Washdown Heavy Vehicle Hardstand Workshop Refuelling Station Laydown Yard Laydown Area 33kV Transmission Line Drainage Channel HV Access Road Switch Yard 4 ROM Pad Plant Control Room Diversion Drain Final Pit Outline 13 September 2002 - Rev. 2 MINE PIT MC03 Haul Road Pit Access East Primary Crushing Secondary Crushing Crusher Substation MC04 MC01 MC02 Main Plant Substation Transfer Station TS10/11 CRUSHING & SCREENING PLANT MC05 MC06 MC07 MC10 Mine Water Tank LUMP STACKER ST01 Dust Collector Scalping/Product Screening Sample/Prep Laboratory Sample Stations MC11 RECLAIMER RC01 Excess Lump Stockpile MC07 MC14 MC15 Transfer Station TS14/15 Transfer Station TS7/8 Lump Stockpile MC08 Excess Lump Stockpile Lump Stockpile Fines Excess Stockpile Lump Stockpile Lump Stockpile Fines Fines Stockpile Excess Fines Stockpile Loadout Substation Loadout Control Room Stockpile Excess Fines Stockpile TRAIN LOADOUT ST01 Tie Down Rail Loop Excess Fines Stockpile ST02 Tie Down FINES STACKER ST02 Gt Northern Highway Airport Village RC01 Tie Down Minesite Pit
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Asset Development Projects KPI s Financial KPI s Original Auth. Budget Current Auth. Budget Project Schedule KPI s Rail 1 st Ore Ship 1 st Ore from Finucane Island Facility Handover to Operations Project HSEC KPI s - 100% (AUD$M) - 100% (AUD$M) Fatalities LTIFR Level 3 Environmental incidents Indigenous Employment (% of site hours) IR Lost Time (% of total hours) Mining Area C Project 398 406 Nov-03 N/A Dec-03 0 <2 0 5% 2-3% PACE Project 653 647 N/A Feb-04 Mar-04 0 <2 0 5% 2-3% All projects are currently running ahead of schedule and under budget in A$ s and in US$ s 8
LTI s CI s CIFR Asset Development Projects Schedule / Cost / Safety Performance Project Milestones Project Approval Complete Nelson Point Commissioning Rail track available for Commissioning Train Complete Commissioning Area C Rail 1 st ore to Nelson Point from Area C Ship 1 st ore ex Nelson Point New Shiploader delivered to Finucane Island Ship 1 st ore ex Finucane Island Planned 22 Mar 02 26 Jul 03 1 Sep 03 11 Sep 03 1 Oct 03 31 Oct 03 27 Nov 03 28 Feb 04 Actual 22 Mar 02 17 Jul 03 16 Aug 03 26 Aug 03 16 Aug 03 24 Sep 03 25 Oct 03 26 Jan 04 Current Budget Progress Manhrs LTIFR Area C Rail PACE 245,780 159,985 647,179 99% 99% 70% Area C Rail 1,092,152 1,109,200 1 0 0.9 0 4 2 3.6 1.8 TOTAL 1,052,944 85% PACE 1,674,192 0 0 7 4.2 TOTAL 3,875,544 1 0.2 13 3.4 9
Mining Area C Project Crushing Plant 10
Mining Area C Project Screening Building 11
Mining Area C Project Reclaimer 12
Mining Area C to Yandi Railroad Project Bulk Earthworks Cut 28 Length 390m Batter Angle 3:1 Depth 35m 13
Mining Area C to Yandi Railroad Project Yeerabiddy Creek Height 45m Fill Volume 440,000bcm Culverts 5 No. 900dia x 165m long 14
Mining Area C to Yandi Railroad Project Marillana Creek Bridge 15
1 st train from Mining Area C 16 August 2003 16
BHP Billiton Iron Ore PACE Project September 2003
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BHP Billiton Iron Ore Capacity Increases September 2003
Port Capacity Improvements 81Mt 100Mt Mt 100 80 60 40 20 0 81 Original MAC/PACE announcement 5 OE & other initiatives 6 Conversion to wet metric tonnes 8 100 Goldsworthy tonnes CY2004 port capacity 22
BHPB WA Iron Ore System Capacity 77mt Finucane Island Boodarie Iron PORT HEDLAND Nelson Point 8mt Nimingarra Yarrie 100 wmt System Capacity $USm 700 600 95 500 90 400 85 300 Yandi Mine HAMERSLEY RANGE 80 75 200 100 0 NEWMAN Jimblebar Port Rail Mine 23
BHPB WA Iron Ore System Capacity 77mt 88mt PACE 95mt Export + 5mt HBI Finucane Island Boodarie Iron Mining Area C 10mt PORT HEDLAND Nelson Point Tertiary crushing, screening, stockpiling & shipping Yandi Mine 80mt HAMERSLEY RANGE 8mt NEWMAN Nimingarra Yarrie Jimblebar 2 rakes 7 sidings 8 locomotives 100 wmt System Capacity 95 600 500 90 400 85 300 200 80 100 75 0 Port Rail Mine $USm 700 24
BHPB WA Iron Ore System Capacity 77mt 92mt PACE 95mt Export + 5mt HBI Finucane Island Boodarie Iron Conveyor + OHP (+3mt) Mining Area C 10mt Secondary crusher (+5mt) PORT HEDLAND Nelson Point Tertiary crushing, screening, stockpiling & shipping Yandi Mine 80mt 84mt HAMERSLEY RANGE 8mt NEWMAN Nimingarra Yarrie Jimblebar 2 rakes 7 sidings 8 locomotives 1 rake wmt 100 System Capacity Port Rail Mine $USm 700 95 600 500 90 400 85 300 200 80 100 75 0 25
BHPB WA Iron Ore System Capacity 77mt 100mt PACE 95mt Export + 5mt HBI Finucane Island Boodarie Iron Conveyor + OHP (+3mt) Mining Area C 10mt Secondary crusher (+5mt) PORT HEDLAND Nelson Point Tertiary crushing, screening, stockpiling & shipping Yandi Mine 80mt 84mt HAMERSLEY RANGE 8mt NEWMAN 92mt Nimingarra Yarrie Jimblebar 2 rakes 7 sidings 8 locomotives 1 rake 1 rake 3 sidings 100 wmt 95 90 85 80 75 System Capacity Port Rail Mine $USm 700 600 500 400 300 200 100 0 26
BHPB WA Iron Ore System Capacity 77mt 92mt PACE 95mt Export + 5mt HBI Finucane Island Boodarie Iron Conveyor + OHP (+3mt) Mining Area C 10mt Secondary crusher (+5mt) PORT HEDLAND Nelson Point Tertiary crushing, screening, stockpiling & shipping Yandi Mine 80mt 84mt HAMERSLEY RANGE 8mt NEWMAN 92mt Nimingarra Yarrie Jimblebar Goldsworthy closure FY05 FY06+ (-8mt capacity, mine, rail, wharf) 2 rakes 7 sidings 8 locomotives 1 rake 1 rake 3 sidings 100 wmt 95 90 85 80 75 System Capacity Port Rail Mine $USm 700 600 500 400 300 200 100 0 27
Timing of Capacity increases Mining Capacity: Additional 5Mt at Area C 1 st Qtr CY2004 Additional 3Mt at Yandi (IOWA) 1 st Qtr CY2004 Rail Capacity 2 nd rake (+ 4Mt) 4 th Qtr CY2003 3 rd rake (+ 4Mt) 1 st Qtr CY2004 Extra 3 sidings (+ 4Mt) 1 st Qtr CY2004 4 th rake (+ 4Mt) 2 nd Qtr CY2004 28
BHP Billiton Iron Ore Long Term Expansion Study September 2003
LTE PFS Global Crude Steel Production Base Case 1200 Mt 1000 800 600 Rise of Europe Rise of Japan Rise of Other Asia Rise of China Global Effective Capacity* CIS/EE China ROW 400 200 0 Source: WSD, BHPB 1945 1955 1965 1975 1985 1995 2005 *Expected output 1yr after price rise EU Japan USA 30
LTE PFS Asian Seaborne Iron Ore Demand 1980 2001 Asia's Iron Ore Imports 300 250 200 Other Asia China Taiwan Korea Japan Other Asia Step Jump in PRC Demand Post 99 China Million WMT 150 Korea Taiwan 100 50 Japan - 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 31 Calendar Year
LTE PFS Catalyst / Initiator Rapid, unprecedented and anticipated long-term sustainable increase in demand for Iron Ore that exceeds current supply capacity of major seaborne traders Growth centred on China Originally based on 120 Mtpa capacity with 40:40:40 split from Newman : Yandi : Area C. Expansion study will now consider possibilities closer to 140 Mtpa or beyond 32
LTE PFS Purpose To select a single go forward case for long term expansion based on 3 concept studies Assessment of the concepts will be carried out on all parameters (not only NPV) in accordance with BHPBIO s Investment System Standard for a PFS PACE Stage 2 Concept Study Spectrum Concept Study Long Term Expansion Pre-feasibility Study Case 1 Case 2 Case 3 Objective evaluation of required scope to achieve financial & production targets Single Go-Forward Case 33
LTE PFS The Cases Case Case 1 Case 2 Case 3 Others Description Two Flexible Ports Based on a four car dumper / four berth port configuration at Port Hedland. Includes installation of Car Dumper 4 (CD4) and upgrading of Berth C at Finucane Island. Three Independent Ports Maintains three car dumpers and three export berths. The port material handling system is modified and expanded to maximise use of the three shiploading berths, by revising operating practices and dedicating stockyards to shiploaders. Spectrum Fundamentally changes the existing operation with crushing and screening of high grade ores undertaken at Newman. Lumps and fines for each product produced on grade at each mine hub. Hybrids adopting the best ideas in all options 34