DIGGERS AND DEALERS 2009 Terry Burgess, Managing Director and CEO. Wednesday 5 August 2009

Transcription

1 DIGGERS AND DEALERS 2009 Terry Burgess, Managing Director and CEO Wednesday 5 August 2009

2 IMPORTANT NOTICE 2 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 are forward-looking statements within the meaning of the US securities laws. Such statements include, but are not limited to, statements with regard to 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 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.

3 $1,000 $100 $10 $1 $0 BHP RIO WPL NCM FMG ORG STO LGL OSH BSL WOR SGM ERA AWC OST OZL CTX FLX AOE PDN AQP KAR MCC EQN EXT SGX SRL AQA AWE ILU MGX RIV MRE CEY WSA PNA ESG BPT OMH AGO MMX LNC KCN GBG IGO PAN ROC ASX 200 RESOURCES INDEX > Few copper producers. Market Cap A$B Copper Diversified Industrial, Oil & Gas, PGE, Bulk, Uranium, Gold, Alumina & Nickel. 3

4 DEMAND FROM CHINA WILL INCREASE 4 > Chinese demand for copper has a long way to go. COPPER INTENSITY OF USE Sth Korea Germany Japan China India China F'cast kg/capita Forecast 0-5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 Source: World Bank, CRU GDP/Capita

5 SUPPLY DEMAND FUNDAMENTALS REMAIN 5 > Supply will be a challenge. COPPER SUPPLY/DEMAND FORECAST LONG TERM 22 Copper (Mt) Refined production e 2012e 2014e 2016e 2018e 2020e Consumption demand Source: ICSG; Brook Hunt; Citi

6 COPPER SHORT TERM THE MARKET REMAINS TIGHT 6 > Production continually lower than predicted. COPPER MINE PRODUCTION LOSSES FROM PLAN '000t Source: Brook Hunt, Macquarie Research, June 2009

7 COPPER LONG TERM, SUPPLY IS HARDER TO FIND 7 > Number of discoveries declining despite increased expenditure. EXPLORATION EXPENDITURES & AMOUNT OF METAL FOUND Primary copper deposits >300kt found in Western World: Mt Cu Exploration Expenditures (2008 US$B) $4 Exploration Expenditures Western World Discoveries $3 60 $2 30 $1 0 $ Caution: Chart excludes deposits missing from the database, or deposits smaller than 300 kt Cu Source: MinEx Consulting July 09, MEG

8 COPPER LONG TERM SUPPLY IS HARDER TO JUSTIFY 8 > Copper price thresholds for ROI are increasing. > At US$2.50/lb copper only 60% of major new projects deliver a 15% or greater ROI. 25% NEXT GENERATION COPPER PROJECTS Project at US$2/lb Cu US$2 /lb Cu 20% Project at US$2.5/lb Cu US$2.5 /lb Cu IRR, % 15% 10% 5% ,000 1,500 2,000 Source: OZ Minerals research Cumulative Annual Copper, kt

9 OPPORTUNITIES 9 > Threshold for large companies mean fewer projects are of interest. EBITDA (2008 USD Millions) Number of copper operations which deliver >US$500million EBITDA COPPER OPERATION TYPE VHMS VHMS copper operation Skarn Skarn copper operation Sediment-hosted copper operation Porphyry copper operation Other Other copper operation IOCG IOCG copper operation Mine Production 2008 (kt Cu) Source: OZ Minerals research

10 OPPORTUNITIES 10 EBITDA (2008 USD Millions) > Smaller companies have more opportunities which make a material difference to their business. Number of copper operations which deliver >US$100million EBITDA COPPER OPERATION TYPE VHMS VHMS copper operation Skarn Skarn copper operation Sediment-hosted copper operation Porphyry copper operation Other Other copper operation IOCG IOCG copper operation Mine Production 2008 (kt Cu) Source: OZ Minerals research

11 OZ MINERALS CAN CAPITALISE: PROMINENT HILL QUALITY FOUNDATION 11 Fundamentals: > Copper with gold credits > Good grades > Simple metallurgy > High grade, high quality product > Stable jurisdiction > Growth studies underway > Exploration upside

12 OZ MINERALS CAN CAPITALISE PROMINENT HILL FUTURE POTENTIAL 12 > More than 15 new Prominent Hill style targets currently being tested. EL 4162 Mount Woods Balta Baltana EL 4025 OZ Minerals Limited Mount Woods Tenements Gravity survey Drill Targets Peculiar Knob North Kennedy s Dam Europe / Callisto White Hill North Zeus EL 4283 Prominent Hill Taurus Larissa Hallifax Hill EL 3229 EL 3795 Prominent Hill South Triton Nichol Well Hathorn Bluff Pluto Danae Hill Mount Hawker

13 OZ MINERALS CAN CAPITALISE: Expertise and experience 13 >Operations >Development > Exploration >M and A

14 THANK YOU