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ANGLO AMERICAN SITE VISITMOGALAKWENA MINE – PLATINUM23 NOVEMBER 2016
PLATINUM
Mogalakwena Mine – load and haul operations
including rope shovel
2
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CAUTIONARY STATEMENT
3
MOGALAKWENA MINE – OVERVIEW
The Northern Limb of the Bushveld Complex is located in the Limpopo Province of South Africa
The Northern Limb is approximately 120km in length
Anglo American Platinum operates the Mogalakwena open pit mine – currently the only operating mine on the Northern Limb
Mogalakwena overview
Reserves
(Contained 4E million troy ounces)
116.0
Inclusive Resources
(Contained 4E million troy ounces)
286.4
Life of mine (years) >100
Number of employees 1,816
Annual Platinum production (koz) c.400
Mogalakwena mine Mogalakwena - drilling and load and haul operations
4
MOGALAKWENA LEADERSHIP TEAM
World class leadership team adding value through the cycle
5
SAFETY PERFORMANCE
Safest platinum mine in the world
Mogalakwena operation benchmarks favourably with international best practice safety performance
The team has a well structured safety strategy in place
Risk approach and progressing priority unwanted events and critical controls
Notable recent safety achievements:
- North concentrator - 489 days LTI free
- South concentrator - 315 days LTI free
- Mining - 226 days LTI free
- Mogalakwena operation - 4.3 million
fatality free shifts (+4 years)
- The concentrator team recently
surpassed 3 million fatality free shifts
(>6 years)
- Awarded the John T Ryan award for
best in class safety performance
0.44
1.141.05
1.451.63
2.02
2015
Incid
ents
per
200 0
00 h
ours
2016 YTD2014201320122011
0.150.17
0.21
0.450.42
0.36
2011 20132012
Incid
ents
per
200 0
00 h
ours
2016 YTD20152014
Total recordable case frequency rate (per 200,000 hrs)
Lost time injury frequency rate (per 200,000 hrs)
6
GEOLOGY AND
RESOURCES
7
GEOLOGICAL SETTING & REGIONAL ACTIVITY
Uniquely positioned for open pit mining
Waterberg
PGM
Platreef
Ivanhoe Mines
Kwanda North
Atlatsa/Anglo Plat
Tweespalk
PGM
Boikgantsho
Anglo Platinum
Harriet’s Wish
Sylvania
Central Block
Atlatsa
Akanani
Lonmin
Activity
Mining
Actively exploring
Not exploring
Project
Southern Platreef
+120km
Mogalakwena
Anglo Platinum
24km
The Northern Limb complex of the Bushveld complex has a strike of 120km
Mogalakwena is the only operational mine in the region currently
The Boikgantsho mineral right added to Mogalakwena to give a strike of 24km
It is unlikely that any other company in the region will be able to start an open pit mine of scale
Ivanhoe Mines is actively developing an underground project
PTM are developing the Waterberg region which sits under significant amounts of sedimentary rock
8
3,712
2,751
1,391 1,260
852
Mogalakwena Impala Northam Lonmin Ivanplats
RESOURCE ENDOWMENT
Most valuable PGM resource in the world
Yellow areas are scheduled resource which is within AAP’s mine plans
Highlighted within the yellow cut outs are the profiles of current pits
Green areas highlight the exclusive resource, excluding our scheduled resource, both of which are published as the inclusive mineral resource
Grey areas emphasize the pre-resource. AAP does not publish Platreef pre-resource unlike our competitors
Published inclusive mineral resources (million tonnes)
(1)
(1) 31 December 2015, (2) 30 June 2015, (3) 30 June 2016, (4) 30 September 2015, (5) Platreef
Project as at 22 April 2016, reported only (not inclusive) ~852 Mt at a 2 g/t 3PE+Au cut-off.
(2) (3) (4)
Mogalakwena super-pit Sandsloot Tweefontein North Tweefontein HillZwartfonteinBoikgantsho
100
600
1 100
1 600
2 100
Resource publication
boundary
Scheduled
resource
Pre-resource
boundary
Pre
resource
2 600
3 100
3 600Drenthe
Fault
Mohlosane
Fault
Dolomite
Tongue
Sandsloot
River
≈ 6.5km ≈ 8.0km≈ 2.0km
Exclusive
resource
750 Extraction
limit
metr
es
(5)
9
DELIVERING VALUE
Valuable basket of metals in high quality concentrate
14%
20%
6%
64%
30%
56%41%
39%30%
23,961
6%
63%
31%
23,500
LonminImplats
32,850
Mogalakwena AAP Total
23,413
3E (Pd, Rh & Au) PlatinumBase metals
2015 revenue split between metals
Highest Rand basket price in the industry at R32,850 per platinum ounce
The major differentiator of Mogalakwena concentrate is base metal loading from nickel and copper
Relatively low amounts of impurities in the concentrate is also favourable from a smelting perspective – low chrome content
(1)
1 Basket price = Total revenue from all metals / platinum ounces
10
OPERATIONAL
PERFORMANCE
11
A FOCUS ON CONTINUOUS IMPROVEMENT
Mining strategy improvements creating significant value
Mine planning driving
significant value
Optimised cut-back schedule
Strike extensions preferred
to down dip pushbacks
Slope angle optimisation
leading to further reduction
in stripping ratio
For period 2017 to 2045
reduced waste mining by
~374Mt
020406080
100120140160180200220
14
16
18
20
22
24
26
28
30
32
34
36
38
40
42
44
2014 mine plan 2015 mine plan 2017 mine plan
Planned mining volumes (Mt)
Stripping ratio (waste to ore ratio)
10.8 10.9
8.4
5.86.7 6.8
3.9
5.94.8
2017 - 2031 2032 - 2041 2017 - 2045
2014 mine plan 2015 mine plan 2017 mine plan
12
Platinum production (‘000 ounces)
DELIVERING HIGHER PRODUCTION AND CASH FLOW
Mogalakwena production continues to improve
304325
354 3694001
16
2223
2012 21013 2014 2015 2016F(inc Baobab)
Mogalakwena Baobab
Unit cost (R/Pt oz) & Cash operating margin (%)
305
341
376392
c.400
15,464 16,148
18,930 17,502 17,647
39%
46% 49%52%
49%
0%
10%
20%
30%
40%
50%
60%
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2012 2013 2014 2015 H1 2016
Cash Operating cost / Pt oz Cash Operaing Margin
Record production performance in 2015 – up 6% to 392 koz
Forecast to improve production in 2016
Unit costs reduced 7% in 2015 due to cost management and productivity initiatives
Highest Rand basket price in the portfolio at R32,850 per platinum ounce
Generated R4.4bn of economic free cash flow
Cash operating margin maintained at 50% despite weaker prices due to benefit of the basket of metals
13
A FOCUS ON CONTINUOUS IMPROVEMENT
Ongoing concentrator improvements
12,754
33,21511,031
2013
11,725
30,222
2014
+21%
10,480
2015
34,848
32,140
2016F
11,731
2012
28,712
North conc. (MNC)
South conc. (MSC)Daily mean (tonnes milled)
Baobab conc.
Concentrator capacity increase –exceeding expectation
Baobab opportunity seized with further benefits to come through as a result of the Pandora transaction with Lonmin
Asset management implemented since 2014 to eliminate defects
Operating model implementation at North and South concentrator
Identifying opportunities for optimisation of the North concentrator dry section to increase stability and sustainability
Assessing recovery improvement in the wet section of North concentrator
Expansion options study to look at where further optimisation can exist in downstream processing
Annual throughput (tonnes milled kt)
14
TONNES MINED
Focus on stability and removing volatility has led to an increase in tonnes mined
Average daily tonnes mined increased 48% between 2012 and 2016F
Focus on maintaining stability and removing volatility in mining
Improvement in overall equipment effectiveness on total heavy mining equipment fleet
Equipment availability and utilisation improved through business improvement initiatives
Increased drilling accuracy improved blasting fragmentation
Improvement in fragmentation positively impacting productivity to negate increased vertical lift and hauling distances
64,384
95,59492,406
97,725
263267
259
2012 2016F
180
+48%
2014
74,943
2013 2015
208
Annual tonnes minedDaily mean (kilo tonnes mined)
Annual mining volumes (tonnes mined kt)
15
OVERALL EQUIPMENT EFFECTIVENESS
World-class performance from a world-class fleet
Benchmarking of 170 operations
globally places Mogalakwena in the
top 10% of all global Komatsu 930E
truck fleets in terms of overall
equipment effectiveness
Mogalakwena fleet’s annual truck
hours are sustainably above industry
benchmark
Whole of life cost of the fleet trending
among the lowest globally
50% 60% 70% 80%
Fre
quency
Overall equipment effectiveness (avail.% x util.% x productivity %)
30%20% 40%
930E
OEE = 71%
930E
OEE = 68%
Global best in class
Current performance
40,0000 80,00060,000 100,00020,000
1,000
2,000
1,500
500
0
Equipment operating hours
Cum
ula
tive c
osts
(R
and/h
r)
Global cost distribution
Actual Forecast
DT
62
DT
72
DT
67
DT
77
DT
64
DT
76
DT
61
DT
65
DT
79
6,000
DT
60
DT
63
DT
71
DT
73
DT
69
DT
75
DT
80
DT
66
DT
68
Ø 6,491
DT
74
DT
78
DT
70
Industry benchmark
Mogalakwena fleet average
Komatsu 930E truck fleet hours for 2016 (annualised)
Global benchmark – overall equipment effectiveness Whole of life forecast – 930E fleet
16
Baobab tonnes treated (kt)
BAOBAB CONCENTRATOR THROUGHPUT
Baobab increasing throughput with further value to be realised from Pandora transaction
Optimised feed ore ratio resulting in increased throughput
Integrated into Mogalakwena North concentrator dry circuit
Additional value will be realised through logistical optimisation of both ore crushing and ore transportation
As a result of Pandora transaction, will be able to treat ore from mining productivity improvements and from value accretive stockpile blending
Baobab average monthly throughput (kt milled)
38
51 50
73
2013 2014 2015 2016 YTD
+94%
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
Jan-13 Jan-16Jan-15 Jul-15Jul-14Jan-14 Jan-17Jul-16Jul-13
+111%
17
SOCIAL PERFORMANCE CLIMATE
Community relations improving through engagement at all levels
Good relations with the National Union of Mineworkers (NUM) – the major union
All engagement structures in place and effective
High literacy level with minimum entry level matric mathematics and science
Challenge on improving literacy levels (employment pipeline)
High performance culture
93% of our total workforce are local
Weekly bilateral leadership forum is in place
Several award winning community engagement projects
Three communities have been relocated, two in total and one near completion
Line management direct involvement with communities yielding results
Mogalakwena Groenfontein Training Initiative, a partnership with local
residents from surrounding villages
Aletuke Community Centre, built by Mogalakwena Mine. Pictured,
community members being trained to be community care givers
18
CONCLUSION
World class operation in the Northern limb with the only operational
open-pit mine
Safest platinum mine in the world – no fatalities for 5 years
Extremely long life asset with large reserves and resources
Expansion potential – but competing for capital in current
environment
Sustainable production – no major project capital needed to
increase production 31% since 2012 – but maintained waste
stripping and SIB capital
Focus on community relationships as our social license to operate
PLATINUM
Q&A
