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Global mining industry and its project pipelines
Damian Brett
Mining Philippines September 2011
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• Raw Materials Data: Metals/Coal/Iron Ore• Strategy development:
Mining companiesEquipment & service providers
• Mineral policy, investment promotion:Governments International organisations
RMG activities
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• Global Demand v Mining Supply• CAPEX• Global Exploration• Project Pipelines• Conclusions
Introduction
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Global demand
Source: Raw Materials Group, Stockholm 2011
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Global mining
Source: Raw Materials Group, Stockholm 2011
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Metals value at mine386 billion USD (2009)
Source: Raw Materials Group, Stockholm 2011
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Global mining
Source: Raw Materials Group, Stockholm 2011
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Top CompaniesCompany name Country Share
(%)Cumulshare (%)
Main metal
1 Vale SA Brazil 4.680 4.68 Fe 2 BHP Billiton Group Australia 4.378 9.06 Div3 Rio Tinto plc UK 4.344 13.40 Div4 Anglo American plc UK 2.930 16.33 Div5 Freeport-McMoran USA 2.425 18.76 Cu/Au6 Barrick Gold Corp Canada 2.008 20.76 Au7 Codelco Chile 2.001 22.77 Cu8 Xstrata plc Switzerland 1.801 24.57 Div9 Norilsk Nickel Russia 1.679 26.25 Ni
10 Newmont Mining USA 1.526 27.77 Au
Source: Raw Materials Data, 2011
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Top CompaniesCompany name Country Share
(%)Cumul
share (%)Main metal
(%)11 Anglogold Ashanti South Africa 1.178 28.95 Au 100
12 Gold Fields Ltd South Africa 0.996 29.95 Au 96
13 Grupo Mexico Mexico 0.918 30.86 Cu 76
14 Belaruskali Belarus 0.814 31.68 K2O 10015 Mosaic Co, The USA 0.785 32.46 K2O 7716 Goldcorp Inc Canada 0.692 33.16 Au 8717 Israel Chemicals Israel 0.683 33.84 K2O 94
18 Eurasian Nat. Res. UK 0.670 34.51 Fe 43
19 Kinross Gold Canada 0.659 35.17 Au 8620 Potash Co Saskatch. Canada 0.643 35.81 K2O 87
Source: Raw Materials Data, 2011
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Global CAPEX
0
2040
6080
100120
140160
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010e
2011f
2012f
BUSD
Source: Raw Materials Group, Stockholm 2011
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Project Pipeline CAPEX
0 200000 400000 600000 800000 MUSD
Conceptual
Prefeasibility
Feasibility
Construction
Operating
Operating, exp/plans
Suspended
Reopen
Source: Raw Materials Data, 2011
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CAPEX by Region
Source: Raw Materials Data, 2011
SE ASIA4%
Rest of Asia7%
Africa14%
Europe11%
Latin America28%
North America19%
Oceania17%
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• Concentration increasing – but for most metals not a problem
• Host countries demand fair share – more state intervention
• Companies from emerging economices gaining importance
• Diversified companies
• Chinese lack influence
Global mining
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Chinese demand
• China leads demand globally.
• Growth rate will decrease.
• Next 5 years it is still China, China!
Rare earths drawing: Kaianders Sempler.
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Chinese mining
02468
101214161820
0 5 10 15 20 25 30
Cu kg/capita
GDP kUSD/capita
USA
Japan
South Korea
China
India
Source: Raw Materials Group, 2011
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Chinese mining• Largest mining country• Many small, high cost mines• Pressure to modernise• Largest exploration country since 2010• Import dependency major policy concern
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Global exploration
Sources: Western world: MEG China: Molar and RMG.
02468
10121416
BU
SD Global Metals
China Metals
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Global Ni
Source: Raw Materials Data, 2011
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Global Ni Reserves
Source: Raw Materials Data, 2011
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Ni Project Pipeline CAPEX
Source: Raw Materials Data, 2011
0 50000 100000 MUSD
ConceptualPrefeasibilityFeasibilityConstructionOperatingOperating, exp/plansSuspendedReopen
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Ni in Reserves (kt)
0 5000 10000 15000 20000 25000 30000 35000
Sulphide
Laterite
Feasibility Construction Operating Restart
Source: Raw Materials Group, Stockholm 2011
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Ni Pipeline Reserves
0 20 40Years
Conceptual
Prefeasibility
Feasibility
Construction
Operating
Operating, exp/plans
Suspended
Reopen
Source: Raw Materials Data, 2011
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• Ni 72% of Reserves in mines25 years in mines
• Cu 75% of Reserves in mines28 years in mines
• Zn 92% of Reserves in mines41 years in mines
Comparison
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• China largest mining country in the world
• Chinese shortfalls in Ni and Cu
• SE Asia ideally positioned and mineral endowed to fulfil this market
• Ni project pipeline has the largest contained reserves in construction phase
Conclusions
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Raw Materials GroupPO Box 3127
SE‐169 03 Solna, Sweden
Tel: +46‐8‐744 00 65 Fax: +46‐8‐744 0066
Thank you
Manganese drawing: Kaianders Sempler.
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Ni Production
Source: Raw Materials Group, 2011
0
500
1000
1500
2000
250020
0020
0120
0220
0320
0420
0520
0620
0720
0820
0920
1020
1120
1220
1320
1420
15
kt
PAL
FeNi
Production
Demand
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Global Cu
Source: Raw Materials Data, 2011
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Global Cu Reserves
Source: Raw Materials Data, 2011
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Cu Project Pipeline CAPEX
Source: Raw Materials Data, 2011
0 100000 200000 MUSD
Conceptual
Prefeasibility
Feasibility
Construction
Operating
Operating, exp/plans
Suspended
Reopen
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Cu Pipeline Reserves (kt)
Source: Raw Materials Data, 2011
0 500000 1000000
ConceptualPrefeasibilityFeasibilityConstructionOperatingOperating, exp/plansSuspendedReopen
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Cu Pipeline Reserves
Source: Raw Materials Data, 2011
0 20 40Years
ConceptualPrefeasibilityFeasibilityConstructionOperatingOperating, exp/plansSuspendedReopen
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Cu Production
Source: Raw Materials Group, 2011
0
5000
10000
15000
20000
25000
2000 2002 2004 2006 2008 2010 2012 2014
kt
Possible
Probable
Committed
Existing Production
Apparent Consumption
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Announced / Completed Projects
Source: Raw Materials Group, 2011
0
50
100
150
200
250
300
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011e
Announced Completed
Boom Starts FinancialCrisis
Recovery
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Chinese iron ore imports
Source: Raw Materials Data, Stockholm 2011
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Chinese foreign expansion
14
1048
124
5
0.64
370
17
0.1
0.27
102
24
0.5
0% 50% 100%
World production
Chinese production
Planned Chinese foreign expansion
Source: BGR 2007
Ferro‐chrome
Bauxite
Iron ore
Copper
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Chinese foreign mines
Source: Raw Materials Data, Stockholm 2011
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Chinese foreign projects
Source: Raw Materials Data, Stockholm 2011
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• Foreign expansion slow• No company in top 20 (yet)• Might increase in the future
Chinese FDI