PIL BARA INF RAST RUCT URE – A NE W L ANDSCAPE PIL BARA INF RAST RUCT URE – A NE W L ANDSCAPE 2013 Inve stor Pr e se ntation – Nove mbe r y 2014 Inve stor Pr e se ntation – F e br uar Russe ll T ippe r, Chie f E xe c utive Offic e r, Bro c kma n Mining Austra lia Russe ll T ippe r, Chie f E xe c utive Offic e r, Bro c kma n Mining Austra lia
Disc la ime r T his pre se nta tio n ha s b e e n pre pa re d b y a nd issue d b y Bro c kma n Mining L imite d (“Bro c kma n” o r “the Co mpa ny”) to a ssist it in info rming inte re ste d pa rtie s a b o ut the Co mpa ny. It sho uld no t b e c o nsid e re d a n invita tio n o r o ffe r to subsc rib e fo r o r purc ha se a ny se c uritie s in the Co mpa ny o r a s a n ind uc e me nt to ma ke a n o ffe r o r invita tio n with re spe c t to tho se se c uritie s. No a g re e me nt to sub sc ribe fo r se c uritie s in the Co mpa ny will be e nte re d into o n the b a sis o f this pre se nta tio n. T his pre se nta tio n c o nta ins fo rwa rd lo o king sta te me nts. While Bro c kma n ha s no re a so n to b e lie ve tha t a ny sta te me nts a re e ithe r fa lse , misle a d ing o r inc o rre c t, it c a nno t g ua ra nte e tha t thro ug h e ithe r pa ssa g e o f time o r a c tio ns b e yo nd the c o ntro l o f Bro c kma n, the y will no t b e c o me so . Yo u sho uld no t a c t o r re fra in fro m a c ting in re lia nc e o n this pre se nta tio n ma te ria l. T his o ve rvie w o f Bro c kma n d o e s no t purpo rt to b e a ll inc lusive o r to c o nta in a ll info rma tio n whic h its re c ipie nts ma y re q uire in o rd e r to ma ke a n info rme d a sse ssme nt o f the Co mpa ny’ s pro spe c ts. Yo u sho uld c o nd uc t yo ur o wn inve stig a tio n a nd pe rfo rm yo ur o wn a na lysis in o rd e r to sa tisfy yo urse lf a s to the a c c ura c y a nd c o mple te ne ss o f the info rma tio n, sta te me nts a nd o pinio ns c o nta ine d in this pre se nta tio n b e fo re ma king a ny inve stme nt d e c isio ns. T he re a re a numbe r o f risks, b o th spe c ific to Bro c kma n a nd o f a g e ne ra l na ture whic h ma y a ffe c t the future o pe ra ting a nd fina nc ia l pe rfo rma nc e o f Bro c kma n a nd the value o f a n inve stme nt in Bro c kma n inc luding a nd no t limite d to e c o no mic c o nd itio ns, sto c k ma rke t fluc tua tio ns, iro n o re d e ma nd a nd pric e mo ve me nts, a c c e ss to infra struc ture , timing o f e nviro nme nta l a ppro va ls, re g ula to ry risks, o pe ra tio na l risks, re lia nc e o n ke y pe rso nne l, re se rve a nd re so urc e e stima tio ns, na tive title a nd title risks, fo re ig n c urre nc y fluc tua tio ns, a nd mining d e ve lo pme nt. 2
Ca pita l Struc ture As a t 17 F e brua ry 2014 Sha re s o n issue 8.4 b illio n Ma rke t c a pita lisa tio n A$502.8 millio n Ca sh o n ha nd* A$ 37.5 millio n De b t* NI L E nte rprise va lue A$ 465.3 millio n Optio ns o n issue 435 millio n * E stima te d e xc lud ing T ra nspo rt Se rvic e s d isc o ntinue d o pe ra tio n 3
Broc kma n Pilba ra Asse ts 4
Mine ra l Re sourc e s/ Ore Re se rve s Summa ry* Proje c t Re sourc e Gra de Re se rve Gra de (Mt) (% F e ) (Mt) (% F e ) Ma rilla na De trita l 1,528 42.6 1,001 42.4 CI D 102 55.6 48 55.5 Ophtha lmia Co o ndine r DSO 129 58.3 - - K a lg a n Cre e k DSO 52 59.1 - - Sirius DSO 109 60.0 - - We st Pilba ra Duc k Cre e k 18 56.5 T OT AL 1,938 1,049 * Refer Appendix 2 for detail 5
Ma rilla na Iron Ore Proje c t Summa ry KE Y ST AT IST ICS 1.05 Bt Mining (Pro ve n: 133 Mt Re se r ve Pro b a b le : 916 Mt) (JORC) * 419 millio n to nne s a t F inal pr oduc t 60.5–61.5% F e and gr ade Co nve ntio na l truc k Mining - a nd sho ve l Ope r ations - F re e dig g ing Ave ra g e Strip Ra tio : - 0.8:1 o ve r life o f mine Up to 20 Mtpa (we t) Annual pr oduc tion Sub je c t to c o nfirma tio n F ir st o f a n infra struc ture pr oduc tion so lutio n Ove r 20 ye a rs Mine life (initial) * Refer Appendix 2 for detail 6
Ma rilla na Proje c t F unding Summa ry DE VE L OPME NT F UNDING De finition Sta tus Pote ntia l Sourc e Sta tus Ma rilla na De finitive E ng ine e ring Jo int ve nture Awa iting ra il MINE Study (DE S) pa rtne r de finitio n c o mple te d (up to 40 %) Ne w Pro po sing Pre - Aurizo n Awa iting inde pe nde nt ra il F e a sib ility Study fe a sib ility studie s RAIL Ac c e ss to T PI ra il Pro c e ss initia te d Aurizo n/ BCK Awa iting o utc o me o f the Ac c e ss pro c e ss DE S c o mple te d Po rt inve sto r Mo U with T ia njin Po rts Gro up Ne w fa c ilitie s a t No rth We st PORT L e a se unde r Build, Own a nd Re c e ive d thre e I nfra struc ture ne g o tia tio n with Po rt Ope ra te (3) E xpre ssio ns o f Autho rity c o nso rtium I nte re st 7
Asse mbling 35 Mtpa – 2014 Gro wing a c c e pta nc e tha t the Mar oje c t is a c ruc ia l pa rt o f ANY ne w • illana Pr Pilb a ra infra struc ture initia tive , due to its sig nific a nt to nna g e thro ug hput a nd lo ng mine life (‘ 20/ 20’ ) oje c t – b e c o ming a stra te g ic a nd sig nific a nt future pro je c t fo r • Ophthalmia Pr up to 15 Mtpa , impro ving the e c o no mic s o f a ny Ma rilla na infra struc ture o ptio n (i.e . E a st Pilb a ra I nde pe nde nt Ra ilwa y (E PI R) o r furthe r T PI Ra il Ac c e ss Applic a tio n) • Bro c kma n is stro ng ly fo c use d o n a dva nc ing r ail and por t infr astr uc tur e options in c o o pe ra tio n with o the rs (i.e . NWI sha re ho lding , Aurizo n Re la tio nship Ag re e me nt, E PI R, T PI a c c e ss a pplic a tio n a nd Mo Us with T ia njin Po rts Gro up a nd F linde rs Mine s) e e me nt ne g o tia tio ns with PHPA we ll • Por t L e ase and De ve lopme nt Agr pro g re sse d a nd o n tra c k to suppo rt po rt c a pa c ity a llo c a tio n a nd e na b le funding initia tive s 8
Pote ntia l use rs of Infra struc ture Produc t Produc tion L ife Proje c t Owne r Sta tus Mt Mtpa ye a rs Ma rilla na BCK 419 20 20 Ma jo r a ppro va ls I ro n Va lle y I OH/ MI N 135 5 27 Mo st a ppro va ls Phil’ s Cre e k MI N 15 3 5 I n pro duc tio n Pilb a ra iro n Ore Pro je c t F MS 229 15 15 PF S Mt We b b e r AGO 64 6 11 All a ppro va ls Mc Phe e Cre e k AGO 178 12 15 DF S la te 2013 Da vidso n Cre e k AGO 239 15 16 DF S De c e mb e r 2011 1,300 76 Othe r Proje c t Re sourc e Produc tion Owne r Re sourc e s Mt Mtpa Ophtha lmia BCK 290 Up to 15 Co runna Do wns AGO 25 ? ? Source: various public releases 9
e Mar illana – Rail Infr astr uc tur 10
a st Pilba ra Inde pe nde nt Ra ilwa y Ba se Ca se : E Co mple te d first sta g e o f E a st Pilb a ra • I nde pe nde nt Ra il Study Aurizo n a nd NWI (Bro c kma n a nd Atla s) • c o ntinue to c o nside r inte g ra te d ra il a nd po rt studie s • Othe r po te ntia l use rs o f the infra struc ture to b e invite d to pa rtic ipa te in the study NWI a dva nc ing Po rt L e a se • ne g o tia tio ns with PHPA to se c ure the 50 Mtpa inne r ha rb o ur a llo c a tio n in whic h Bro c kma n c a n pa rtic ipa te a s a fo unda tio n sha re ho lde r 11
PI Ra ilwa y Ac c e ss Ca se – T Bro c kma n sub mitte d a n a pplic a tio n to • a c c e ss the T PI ra ilwa y o n 15 Ma y 2013 unde r the WA Ra il Ac c e ss Co de (2000) • I nde pe nde nt a sse ssme nt indic a te s tha t T PI ha s a va ila b le ra il c a pa c ity within its c urre nt c o nfig ura tio n • T PI is o b lig e d unde r the Ra il Ac c e ss Co de a nd its Sta te Ag re e me nt to fa c ilita te a c c e ss fo r third pa rtie s to its ra il infra struc ture 12
Ra il Ac c e ss Re g ime – Sta tus • Bro c kma n re q uire s a c c e ss to o nly pa rt o f the T PI ne two rk (196 km) • I n Ma y 2013, T PI ma de a n a pplic a tio n to the E RA unde r se c tio n 10 (1) o f the Co de re q uiring its a ppro va l fo r ne g o tia tio ns to pro c e e d. I n Aug ust 2013, E RA a ppro ve d ne g o tia tio ns to pro c e e d re g a rding Bro c kma n’ s Ac c e ss Pro po sa l • I n Se pte mb e r 2013, the E RA re je c te d T PI ’ s pro po se d 2013 flo o r c o st o f $73,412,642 a nd c e iling c o st o f $575,642,663 1 . T PI ’ s 2010 flo o r a nd c e iling pric e sub missio n ra ng e d fro m A$5.07 – A$5.77* pe r to nne fo r its the n to ta l ra il ne two rk (280 km) b e twe e n Clo udb re a k a nd Po rt He dla nd running a t 40 Mtpa (*Se e E c o no mic Re g ula tio n Autho rity Re vie w 2010, b a se d o n WACC o f 11%) • T he E RA de te rmine d a floor c ost of $84,742,039 ($0.55/ tonne ba se d on 155 Mtpa ) a nd a c e iling c ost of $316,901,814 ($2.04/ tonne ba se d on 155 Mtpa ) a nd a WACC of 9.76% I n Oc to b e r 2013, T PI lo dg e d Applic a tio ns with the WA Supre me Co urt fo r a judic ia l re vie w • o f the E RA de te rmina tio n o f T PI ’ s F lo o r a nd Ce iling c o sts a nd its de c isio n to a ppro ve ne g o tia tio ns unde r se c tio n 10 o f the Co de ; a nd a De c la ra tio n tha t Bro c kma n’ s Ac c e ss pro po sa l do e s no t e nlive n the o pe ra tio n o f the Co de 1. As re po rte d 28 June 2013 b y Ma tthe w Ste ve ns, AF R 13
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