Vale Nickel business Roberto Moretzsohn Rio de Janeiro Executive Vice President, Marketing Vale Inco September 2009 1
Vale has a strong platform to grow the nickel business A balance of sulphide and laterite properties Current � Sudbury � Voisey’s Bay � Thompson � Indonesia Growth � Onca Puma � Goro 2
Vale nickel business is located… Tonimet Electro Thompson Thompson Voisey’ ’s s Voisey Bay Bay Clydach Clydach Sudbury Sudbury KNC KNC Matsusaka Matsusaka Dalian Dalian TNRC TNRC PTI PTI Carbonyl Onca Puma Onca Puma Goro Goro Utility Refinery Mines Development Properties 3
We continue to develop and build our leading position in the nickel market Nickel reserves (100% Basis)1 million metric tons of contained nickel Vale 8.9 Norilsk Nickel 5.8 Jinchuan 4.5 BHPB 4.1 Xstrata 2.6 Eramet 2.0 ¹ P&P reserves Sources: BrookHunt 2008 edition Nickel Industry Cost Study and Vale annual report 2008 4 Note: Xstrata includes 100% Koniambo
Continued focus on employee health and safety � Canadian mines have won the John T. Ryan award for “Safest Metal Mine in Canada” for a record 5 years in a row. - Birchtree Mine (Thompson) – 2004. - Garson Mine (Sudbury) – 2005. - North Mine (Sudbury)– 2006, 2007 & 2008 . � In January 2009, Copper Cliff North Mine celebrated 3 years disabling injury (DI) free – a milestone virtually unprecedented in the industry. � Indonesian Operations lead Vale Nickel business in safety performance. 5
We continue to grow our production capability to leverage our resource base kt of Nickel 275 � Increases with the addition of Voisey's Bay, additional mine 248 development and processing 235 improvements in Canada, as well 220 as increased thermal power in Indonesia. � 2008 production curtailed in Q4 due to market conditions. � With the commissioning of Goro and Onca Puma, production will increase by ~ 45% when fully ramped up. 2005 2006 2007 2008 Source: Vale 6
Managed the near term impacts of the market downturn with focus on sustainable improvements Production � Flexing the production capacity in PTI utilizing the fuel fired power sources. � Optimizing product mix to meet changing market demands. � Review of mine design and processing configurations to allow for more efficient operations. Operating Costs � Workforce efficiency improvements. � Reorganization – corporate functions and operations. � Cost reduction targets in all operations and corporate office. Capital and Sustaining Investments � Prioritization of key projects to deliver long term growth while maintaining the sustainability of the asset base. 7
Onca Puma � Nickel laterite operation in the state of Para to produce ferronickel. � Annual capacity: 58 kt of nickel in ferronickel. � Estimated investment: US $ 2.297 billion. � Construction progressing again. � Operational readiness assessment underway . � Operations training taking place. � First line is expected to be commissioned in 2H10. 8
Goro Project � High Pressure Acid Leach (HPAL). � Process for laterite ores in the Southern Province of New Caledonia. � Annual capacity: 60 kt nickel oxide and 4,600 t cobalt intermediate. � Estimated investment: US $4.083 billion. � Project construction complete. � Commissioning underway. � Recovered from the impact of the acid plant incident. � Operations fully staffed. � First production late 2009. 9
Voisey’s Bay processing plant � Hydrometallurgical plant to process sulphide concentrates. � Annual capacity: - 50 kt electronickel. - 5,000 t copper. - 2,500 t cobalt. � Scheduled completion by Feb 2013. � Project released from further Environmental Assessment, 2008. � Hydromet technology selected in November 2008. � Feasibility level of engineering completed. � Early works started in April 2009. � Detailed engineering, procurement and construction activities in progress. 10
Nickel prices have recovered from their 2009 lows LME LME cash nickel price and stocks LME Stocks January 2 0 0 5 to Sept 2 5 2 0 0 9 Cash Price (tonnes) (US$/ tonne) 140,000 50,000 120,000 40,000 100,000 80,000 30,000 60,000 20,000 40,000 10,000 20,000 0 0 2005 2006 2007 2008 2009 11 Source: LME
Market update � Robust Chinese nickel demand drove the market in H1 2009. � Stainless production continues improvements. - China setting production records in Q2/Q3 – potential Q4 moderation. - Recovery outside China gathering pace in Q3 – representing 70%+ of world SS market in 2008. - Declining scrap availability and higher austenitic ratio to drive primary nickel demand growth. - Potential remains for stainless re-stocking outside China . � Non-stainless remains mixed – improvements in a number of sectors. � Nickel supply declining in first half of 2009. 12
In the first half of 2009, China and Taiwan drove stainless production – improvements have broadened to all markets into Q3 Quarterly stainless production trends Index Q1 2006 – Q2 2009 (f) Q1 2006 = 100 225 175 China/ Taiw an 125 Rest of W orld 75 25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2e 2007 2008 2009 2006 * Source: Vale estimates 13
We have a strong presence in the growing Asian market World nickel demand by geography versus Vale sales 12% 33% 27% 53% 60% 9% 1% 5% 2008 World nickel use Vale 2008 sales Europe Rest of World North America Asia 14
15 be challenging given the inherent volatility Selling nickel to the stainless steel industry can Change Change Q-O-Q Y-O-Y Source: 1970-2000 Macquarie Bank, 2001-2009 Vale -25% -20% -35% -25% -15% -1 -1 20% 25% 15% 25% 35% -5% 1 1 -5% 5% 0% 0% 5% 0% 5% 5% 1Q70 1 Q7 0 4Q70 4 Q7 0 3Q71 3 Q7 1 2Q72 2 Q7 2 1Q73 1 Q7 3 4Q73 4 Q7 3 3Q74 3 Q7 4 2Q75 2 Q7 5 1Q76 1 Q7 6 Quarterly stainless steel production 4Q76 4 Q7 6 3Q77 3 Q7 7 2Q78 2 Q7 8 1Q79 1 Q7 9 4Q79 4 Q7 9 3Q80 3 Q8 0 2Q81 2 Q8 1 1Q82 1 Q8 2 1970 to 2009Q2 (f) 4Q82 4 Q8 2 3Q83 3 Q8 3 2Q84 2 Q8 4 1Q85 1 Q8 5 4Q85 4 Q8 5 3Q86 3 Q8 6 2Q87 2 Q8 7 1Q88 1 Q8 8 4Q88 4 Q8 8 3Q89 3 Q8 9 2Q90 2 Q9 0 1Q91 1 Q9 1 4Q91 4 Q9 1 3Q92 3 Q9 2 2Q93 2 Q9 3 1Q94 1 Q9 4 4Q94 4 Q9 4 3Q95 3 Q9 5 2Q96 2 Q9 6 1Q97 1 Q9 7 4Q97 4 Q9 7 3Q98 3 Q9 8 2Q99 2 Q9 9 1Q00 1 Q0 0 4Q00 4 Q0 0 3Q01 3 Q0 1 2Q02 2 Q0 2 1Q03 1 Q0 3 4Q03 4 Q0 3 3Q04 3 Q0 4 2Q05 2 Q0 5 1Q06 1 Q0 6 4Q06 4 Q0 6 3Q07 3 Q0 7 2Q08 2 Q0 8 1Q09E 1 Q0 9E
We have a strong position in Non-Stainless sectors providing flexibility to shift nickel in and out of the Stainless sector to manage demand variability World Nickel demand by application versus Vale sales 33% 43% 42% 57% 58% 67% 2008 World nickel use Vale 2008 sales Vale 2009 H1 sales Stainless Non-Stainless 16
In summary, Vale is positioned to remain a global nickel leader for many years to come � Nickel demand poised to rebound with global economic recovery. � Vale has the best in-ground nickel assets with cost structure improvements underway to maximize value. � Flexibility in our nickel production, both in terms of product mix and volume, to meet the market needs. � Excellent growth potential to continue to provide nickel as one of the essential ingredients of people’s everyday lives far into the future. 17
Iron ore market outlook Pedro Gutemberg Rio de Janeiro September 2009 Director of Iron Ore Marketing and R&D 1
Disclaimer “This presentation may include declarations about Vale's expectations regarding future events or results. All declarations based upon future expectations, rather than historical facts, are subject to various risks and uncertainties. Vale cannot guarantee that such declarations will prove to be correct. These risks and uncertainties include factors related to the following: (a) the countries where Vale operates, mainly Brazil and Canada; (b) the global economy; (c) capital markets; (d) the mining and metals businesses and their dependence upon global industrial production, which is cyclical by nature; and (e) the high degree of global competition in the markets in which Vale operates. To obtain further information on factors that may give rise to results different from those forecast by Vale, please consult the reports filed with the Brazilian Comissão de Valores Mobiliários (CVM), the French Autorité des Marchés Financiers (AMF), and with the U.S. Securities and Exchange Commission (SEC), including Vale’s most recent Annual Report on Form 20F and its reports on Form 6K.” 2
Agenda � Company overview � Steel market outlook � Iron ore market outlook � Final comments 3
seção, definido em 50pts. Colocar aqui o divisor da Company Overview 4
Vale has the largest reserve base in the iron ore industry Reserves (t) 1 2008 Production (Mt) Northern System 6 mines 7.2 Bi 96.5 Southeastern System 3.7 Bi 116.4 13 mines Southern System 3.5 Bi 80.5 10 mines TOTAL VALE 14.3 Bi 293.4 ¹ Proven and probable reserves, as of Dec, 2008. 5
Recommend
More recommend
