OZ MINERALS CONTINUED INVESTMENT IN SOUTH AUSTRALIA TERRY BURGESS - Managing Director & CEO SAREIC - 02 May 2011 WWW.OZMINERALS.COM
DISCLAIMER This presentation has been prepared by OZ Minerals Limited ( OZ Minerals ) and consists of written materials/slides for a presentation concerning OZ Minerals. By reviewing/attending this presentation, you agree to be bound by the following conditions. No representation or warranty, express or implied, is made as to the fairness, accuracy, or completeness of the information, contained in the presentation or of the views, opinions and conclusions contained in this material. To the maximum extent permitted by law, OZ Minerals and its related bodies corporate and affiliates, and its respective directors, officers, employees, agents and advisers disclaim any liability (including, without limitation any liability arising from fault or negligence) for any loss or damage arising from any use of this material or its contents, including any error or omission there from, or otherwise arising in connection with it. Some statements in this presentation relate to the future and are forward looking statements. Such statements may include, but are not limited to, statements with regard to intention, capacity, future production and grades, projections for sales growth, estimated revenues and reserves, targets for cost savings, the construction cost of new projects, projected capital expenditures, the timing of new projects, future cash flow and debt levels, the outlook for minerals and metals prices, the outlook for economic recovery and trends in the trading environment and may be (but are not necessarily) identified by the use of phrases such as will, expect, anticipate, believe and envisage. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and may be outside OZ Mineral s control. Actual results and developments may differ materially from those expressed or implied in such statements because of a number of factors, including levels of demand and market prices, the ability to produce and transport products profitably, the impact of foreign currency exchange rates on market prices and operating costs, operational problems, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such as changes in taxation or regulation. Given these risks and uncertainties, undue reliance should not be placed on forward-looking statements and intentions which speak only as at the date of the presentation. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, OZ Minerals does not undertake any obligation to publicly release any updates or revisions to any forward looking statements contained in this presentation, whether as a result of any change in OZ Minerals expectations in relation to them, or any change in events, conditions or circumstances on which any such statement is based. Certain statistical and other information included in this presentation is sourced from publicly available third party sources and has not been independently verified. OZ MINERALS PAGE 2
OZ MINERALS SNAPSHOT Market capitalisation: Prominent Hill: Exploration: ~A$5 billion Open-pit copper and gold operation. Underground development underway. Priority area Prominent Hill. Further global and regional opportunities. Business Development: Pursuing opportunities in copper. In process of acquiring 100% of Carrapateena copper project. A$1.3 billion: Cash at 31 December 2010. No debt. Equity investments: 42.5% of Toro Energy, 12.9% of IMX Resources, 18.9% of Sandfire Resources and others. OZ MINERALS PAGE 3
CONTINUED INVESTMENT IN SOUTH AUSTRALIA 1. Prominent Hill update including our underground development. 2. Carrapateena. 3. Making a difference in South Australia. OZ MINERALS PAGE 4
PROMINENT HILL The Prominent Hill copper/gold mine is located 650 km north-northwest of Adelaide, approximately 130 km southeast of Coober Pedy and 150 km northwest of Roxby Downs (Olympic Dam) in the Gawler Craton of South Australia. Convenient access to the Adelaide to Darwin railway shipments of concentrate take 48 hours to reach the Port of Darwin. We have approximately 6 trains/wk to Darwin (600-1,000t each). 2 weeks to major Asian ports. 1 truck/day to Olympic Dam. OZ MINERALS PAGE 5
PROMINENT HILL SITE VILLAGE ANKATA DEPOSIT AREA ROM PAD NORTHERN WASTE DUMP PROCESSING PLANT MALU PIT SOUTHERN WASTE DUMP TAILINGS DAM OZ MINERALS PAGE 6
PROMINENT HILL FACTS A workforce of approximately 800 this includes contractors. Plus 150 underground construction 2011-2012. Plus 100 steady-state underground operations 2012 onward. We have a local workforce 80% of our people are from South Australia. Mining partner Thiess. Underground contractor Byrnecut Mining Village Services Sodexo Charter Flight services - 10 flights a week from Adelaide and six flights a week from Port Augusta. Daily bus service from Coober Pedy. Site Facilities 1200 rooms with en-suites, swimming pool, sports courts and gymnasium. Regular family days to bring family members to site to experience life at Prominent Hill. OZ MINERALS PAGE 7
PROMINENT HILL PRODUCTION Product: Production (2010): High grade (~50% Cu), high quality, copper concentrate. 112,171t contained copper, 196,400oz gold. Production Guidance: Contained copper 100,000t to 110,000t Contained gold 185,000oz plus -for 5+ years Mine and Plant: Open pit, mine, crush, grind, flotation. Cash costs: Competitive C1 cash costs US70.3c/lb for Q1 2011. Estimated C1 costs 2011: <US70c/lb. Cu and Au Recovery TPH Milled 95.00 1300 Recovery (%) 85.00 75.00 65.00 55.00 45.00 35.00 25.00 15.00 Cu Au TPH Milled (Dry) 1100 900 700 500 Q1 2011 Q3 2010 Q1 2010 Q3 2009 Q1 2009 Q1 2011 Q3 2010 Q1 2010 Q3 2009 Q1 2009 OZ MINERALS PAGE 8
OPEN-CUT MINE CROSS SECTION NORTH-SOUTH Complete August 2012 June 2014 October 2017 (Stock piles continue to be processed after mining of open-cut complete) OZ MINERALS PAGE 9
PROMINENT HILL ANKATA - UNDERGROUND Ankata underground will enable production of 100,000t to 110,000t copper to be maintained. The portal was accessed in November and advanced 626 meters by Q1 2011. First ore to be produced from stoping by Q1 2012. Full mining rates (1.2Mtpa) by Q3 2012. VR4A April 2011 Interim Decline Ankata Decline Final Portal VR2A OZ MINERALS PAGE 10
PROMINENT HILL ANKATA - UNDERGROUND Interim Decline Permanent Decline OZ MINERALS PAGE 11
PROMINENT HILL FOCUS ON MUNDA/KALAYA CONTINUITY APPEARS GOOD PROMINENT HILL LONG SECTION 2011 OZ MINERALS PAGE 12
PROMINENT HILL FOCUS ON MUNDA/KALAYA CONTINUITY APPEARS GOOD PROMINENT HILL LONG SECTION 2011 MINING STUDY 2011/2012 OZ MINERALS PAGE 13
REGIONAL EXPLORATION NEW MINERAL PROVINCE Coober Pedy EL3445 Shadwell IMX tenements IP Surveys in Progress EL3830 EL3729 EL4429 EL3518 Airborne Magnetic Survey completed in Q4 Arapiles EL4283 EL3730 Rouse EL4132 EL4429 EL4429 Bluebird Taurus Blue Duck Cressida EL3795 Epsilon Near Mine EL4025 Prominent Hill EL3730 Neptune Metis Future OZ Minerals Prospects IMX JV target areas EL4390 OZ Minerals tenements EL3387 EL4446 Perseus Hallifax Danae Hill Approximately 7,000km 2 tenement area - 4,000km 2 OZ Minerals - 3,000km 2 IMX JV $50 million regional exploration budget. Detailed geophysics surveys undertaken. 2011 five drill rigs dedicated to the OZ Minerals regional program and one drill rig for IMX JV exploration. 21 holes drilled in quarter one. Many holes intersected IOCG alteration. Some low-grade mineralisation. Program continues. Gravity 20km OZ MINERALS PAGE 14
ACQUISTION OF THE CARRAPATEENA COPPER GOLD DEPOSIT IN SOUTH AUSTRALIA Agreement to purchase Carrapateena IOCG copper project in March. US$250 million, plus US$50 million on production of copper and uranium, gold or silver. Benefits for OZ Minerals: Meets strategy: copper, appropriate production scale potential, favourable mining jurisdiction, long-life potential. Development could be funded from anticipated Prominent Hill cash flows. Offers development, operations, exploration, logistics and management synergies. OZ MINERALS PAGE 15
COMPETITIVE ACQUISTION 90 80 Exploration / Development Construction / Production 70 60 EVc/lb CuEq 50 40 Advanced Projects / Producers 30 20 10 - OZ Minerals/ Carrapateena OZ MINERALS PAGE 16
CARRAPATEENA DEPOSIT - INITIAL INFERRED RESOURCE TO SOUTH Chalcopyrite shell in yellow Exploration & Inferred Resource status area Exploration area Historic drillhole collar Historic drillhole trace N Target range: 25-45Mt @ 1% Cu, 0.4g/t Au, 140ppm U 3 O 8, 4g/t Ag Mineralisation not well understood, potential for extension to the east Main deposit Potential for extension at depth Mineralisation open to the east Exploration area Exploration & Inferred Resource status area Inferred resource: 0m 250m 203Mt @ 1.31% Cu, 0.56g/t Au, 270ppm U 3 O 8, 6g/t Ag OZ MINERALS PAGE 17
MINING OPTIONS STUDY Options: Block caving. Inclined sublevel caving. Stoping at higher levels (then caving). Visual representation of the Carrapateena deposit Lower mining costs <$10/t $10 20/t $20 50/t Block caving Sublevel caving Sublevel open stoping Lower development costs OZ MINERALS PAGE 18
BLOCK CAVING INCREASINGLY COMMON Source: New Gold OZ MINERALS PAGE 19
CARRAPATEENA COMPARABLE WITH OTHER GLOBAL BLOCK CAVES Cu % 2.00 1.75 Cu/Au grades and relative deposit size global block caves (Mt) Northparkes Lift 1 1.50 1.25 1.00 Oyu-Tolgoi Hugo North Lift Northparkes Lift 2 Grasberg IOZ Northparkes E48 Carrapateena Grasberg DOZ Grasberg GBC 0.75 Bingham Canyon SE mine Bingham Canyon NE mine Wafi-Golpu Red Chris 0.50 Skouries 0.25 Cadia East Ridgeway Deeps 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00 Au g/t Operating mines Development project Size = Reserves Mt * NB: Carrapateena based on target range not Resource or Reserve Source: OZ Minerals research OZ MINERALS PAGE 20
CARRAPATEENA CONCEPTUAL PROJECT SCHEDULE 2011 2012 2013 2014 2015 2016 2017 Exploration drilling to complete initial Inferred Resource, 10,000m Option studies for mining Phase II exploration drilling to move to Indicated Resource Geotechnical drilling Pre-feasibility Exploration shaft Feasibility study Construction OZ MINERALS PAGE 21
GENERATION OF LOCAL ECONOMIC BENEFITS xxx We actively provide employment and business opportunities for people from communities close to Prominent Hill and preferentially purchase goods and services locally wherever feasible. Over 20 local businesses are currently employed at Prominent Hill. During 2010 $12 million was spent in the Coober Pedy region $7.5 million in the Upper Spencer gulf and $80 million within the state of South Australia. Our major contractor also have significant spend in the local area. We also spend about $30 million on salaries in South Australia - again this does not include the amounts that our major contractors spend. There over 500 people employed by contractors as part of our workforce at Prominent Hill. In 2010 we contributed 16 million in State Government royalties. OZ MINERALS PAGE 22
DEVELOPMENT OF LOCAL EMPLOYMENT OPPORTUNITIES AND SKILLS Employing locally and developing people from outside the industry - a key priority. Continued success with our locally targeted pre-employment training program. In 2010, eight indigenous trainees from the APY lands graduated from the program and as a result became full-time employees at Prominent Hill. 51 people have now graduated and been offered employment from this program. Nationally accredited TAFE qualifications. Guaranteed employment We have started a new program to train local and indigenous employees to work in a supervisory capacity this program commenced today. OZ MINERALS PAGE 23
GRADUATES AND APPRENTICES Our university graduate program is a two year program building on technical planning and people management skills. We currently have graduates from the areas of metallurgy, mining engineering, environmental engineering and geology. Apprenticeships are a great way to enter the workforce. Our apprenticeships are conducted on a full-time basis for a four year fixed term period in electrical and mechanical areas. New pilot program in conjunction with DECS teachers from four schools to visit Prominent Hill this month to better understand opportunities for careers in the mining industry. OZ MINERALS PAGE 24
RECRUITMENT CAMPAIGN Attraction of ready skilled people to South Australia is critical OZ MINERALS PAGE 25
Investor contact: Natalie Worley Head of Investor & External Relations natalie.worley@ozminerals.com THE INFORMATION IN THIS PRESENTATION WHICH REFERS TO MINERAL RESOURCES AND EXPLORATION RESULTS AT CARRAPATEENA IS BASED IN INFORMATION COMPILED BY STUART MASTERS WHO IS A MEMBER OF THE AUSTRALASIAN INSTITUTE OF MINING AND METALLURGY (AUSIMM) (108430). STUART MASTERS IS EMPLOYED BY CS-2 PTY LTD AND IS A CONSULTANT TO OZ MINERALS. HE HAS SUFFICIENT EXPERIENCE WHICH IS RELEVANT TO THE STYLE OF MINERALISATION AND TYPE OF DEPOSIT UNDER CONSIDERATION AND TO THE ACTIVITY WHICH HE IS UNDERTAKING TO QUALIFY AS A COMPETENT PERSON AS DEFINED IN THE 2004 EDITION OF THE AUSTRALIAN CODE FOR REPORTING OF EXPLORATION RESULTS, MINERAL RESOURCES AND ORE RESERVES. STUART MASTERS CONSENTS TO THE INCLUSION IN THE REPORT OF THE MATTERS BASED ON HIS INFORMATION IN THE FORM AND CONTEXT IN WHICH IT APPEARS. WITHIN THIS PRESENTATION REFERENCES TO EXPLORATION RESULTS RELATING TO PROMINENT HILL ARE BASED ON INFORMATION COMPILED BY MR MARCEL VAN ECK MSC WHO IS A FULL-TIME EMPLOYEE OF OZ MINERALS, IS A MEMBER OF THE AUSTRALIAN INSTITUTE OF GEOSCIENTISTS AND HAS SUFFICIENT EXPERIENCE RELEVANT TO THE STYLE OF MINERALISATION AND TYPE OF DEPOSIT UNDER CONSIDERATION AND TO THE ACTIVITIES UNDERTAKEN TO QUALIFY AS A COMPETENT PERSON AS DEFINED BY THE JORC CODE (2004). MR VAN ECK HAS CONSENTED TO THE INCLUSION OF THE MATERIAL IN THE FORM AND CONTEXT IN WHICH IT APPEARS. ALL OTHER REFERENCES TO EXPLORATION RESULTS WITHIN THIS PRESENTATION/STATEMENT ARE BASED ON INFORMATION COMPILED BY MR A HOUSTON BSC WHO IS A FULL-TIME EMPLOYEE OF OZ MINERALS, IS A MEMBER OF THE AUSTRALIAN INSTITUTE OF GEOSCIENTISTS AND HAS SUFFICIENT EXPERIENCE RELEVANT TO THE STYLE OF MINERALISATION AND TYPE OF DEPOSIT UNDER CONSIDERATION AND TO THE ACTIVITIES UNDERTAKEN TO QUALIFY AS A COMPETENT PERSON AS DEFINED BY THE JORC CODE (2004). MR HOUSTON HAS CONSENTED TO THE INCLUSION OF THE MATERIAL IN THE FORM AND CONTEXT IN WHICH IT APPEARS.