LKAB PRESENTATION

Magnus Johansson Jänkänpää

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A world without steel is unthinkable. Steel is made from Iron ore and is recyclable.

ResponsibilityPut safety first.

Keep your promises.Care about the environment

and the places where we operate.

InnovationWelcome new ideas.

Be open to differences.Find new solutions.

CommitmentTake the initiative.Do that little extra.

Increase our efficiency.

LKAB’s values

LKAB MOVIE

OPERATIONS

Employees: c.4,200 Owner: 100% Swedish state

Operations

KirunaUnder ground

mining and processing

KirunaUnder ground

mining and processing

MalmbergetUnder ground

mining and processing

MalmbergetUnder ground

mining and processing

LuleåHarbour and Head Office

LuleåHarbour and Head Office

SvappavaaraOpen pit mining and processing

SvappavaaraOpen pit mining and processing

NarvikHarbourNarvikHarbour

MalmbananRailway Narvik -

Luleå

MalmbananRailway Narvik -

Luleå

IRON ORE OPERATIONS

Harbours

Mines and processing plants

Sales and/or purchasing offices

LKAB Minerals and LKAB Wassara

LKAB WORLDWIDE

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PRODUCTION

LKAB accounts for 90 % of the iron ore produced in the E.U.

Sweden has 60 % of Europe’s iron ore assets.

KÄLLA: USGS; RGM

Production EU27

90 %LKAB90 %LKAB10 %

Others10 %Others

GROWTH OF THE IRON ORE MARKET (SEABORNE) 2000 – 2021F

Source: CRU Iron Ore Market Outlook Dec 2011 & Jan 2013

2000 VS 2010 VS 2020

PRODUCTION AND SALES

Blast furnace pellets (BF) for manufacturing with coal Direct reduction pellets (DR) for manufacturing with natural gas

Pellets BF 63%

Pellets DR 21%

Fines 12%

Special 4%

Products

Europe 67%

MENA & Asien 32%

Others 1%

Market (Revenues)

THE IRON ORE MARKET AND LKAB

LKABCompetitors

GLOBAL EXPORTS OF IRON ORE (VOLUME)

Australia39%

Brazil 31%

Lat. Am. 2.7 %

India 4.5 %

Others 4.5%Sweden

1.8%Africa 1%

South Africa 4.6%

Canada 3%

CIS 6.7%

CIS: Commonwealth of Independent States (members of the former Soviet Republics)

Source UNCTAD Iron Ore Statistics 2012.

Magnetite oxidises during the manufacturing of pellets and thereby provides 60 procentof the energy required.

LKAB has the world’s most energy-efficient manufacturing process. • Less fossil fuels• Lower Co2 emissions

*Source: Swerea/MEFOS 2010 ”Benchmarking of carbon dioxide emissions from iron ore pelletizing” av Lawrence Hooey

LKAB green pellets

GROWTH 2010–2015

+35%

LK37

The quantity of iron LKAB takes up from its underground mines per day is equivalent to 6 Eiffel Towers

From 2015 the open pit mines in Svappavaara is planned to give iron equivalent to 2 Eiffel Towers .

KirunaKiruna

MalmbergetMalmberget

Svappavaara

E10 highway towards Kiruna

MertainenStart planned in 2015

Malmbananrailroad

GruvbergetIn operation May 2010 -June 2012. Plans to restart operations before 2015

LeveäniemiStart planned in 2015

Power network

THE SVAPPAVAARA FIELD- EUROPE’S BIGGEST IRON ORE PROJECT

New railway

KUJ 1365

New sluices Luossajärvi

Mining machinery

New dam Luossajärvi

150 new residential properties Luossavaara

Reconstruction of barracks 24 new apartments Jägarskolan

Upgrading of control system and process plants

4 new locomotives and 5 new carraige sets

Mining town park, stage 1

50 new apartments Jägarskolan

Infrastructure below ground

Storeage facilities for coal

New laboratory

Capaciity-raising measures KK4

Upgrading of locomotive terminal

More efficient train operations

Construction of dams

Railway connection of terminal tracks

New approaches and roads

ONGOING AND PLANNED INVESTMENTS IN KIRUNA

Underground workshops and areas for workers

M1250

Mining machineryDam raising

Infrastructure below ground

Agglomeration laboratory

New entrance and office

Upgrading of the infrastructure

Upgrading of purification plant

More secure electricity supplies

4 new locomotives and 5 new carraige sets

More efficient train operations

More efficient warehousing

Replacement accomodationfor student housing area

Acquisition and new construction Granbacka

ONGOING AND PLANNED INVESTMENTS IN MALMBERGET

New evacuation road

Improved ventilation

New flue-gas cleaning

New freight outbound

New freight inbound for additives

Gruvberget

Collages

Drainage Leveäniemi

Mertainen

ONGOING AND PLANNED INVESTMENTSIN SVAPPAVAARA

Dam measures

Reconstruction of terminal

4 new locomotives and 5 new carraige sets

More efficient train operations

Environmental and risk-reducing measures

New additives-handling facility

Land acquisition Upgrading Lundberg storage buildning

4 new locomotives and 5 new carraige sets

More efficient train operations

ONGOING AND PLANNED INVESTMENTS IN NARVIK

• The capacity of Malmbanan• Uncertainty about the time required for

granting of permits • Competence requirements• Attractive urban development• Housing• Energy• Costs

GROWTH CHALLENGES

Deformation zoneFracture

zoneCaving zone

EFFECTS FROM MINING IN KIRUNA

EXPANSIVE MALMFÄLTEN

LKAB has a workforce of about 4,200 and employs some 11,500 contractors and consultants in the region.

Open unemployment in Kiruna, in October 2012 was 328 people. (504 job vacancies).

LKAB has decided to build 500 homes in Kiruna and Gällivareby 2015.

1000 NEW EMPLOYEES BY 2015

Great need to recruitThe largest occupational groups needed are miners, mechanics/repair men and engineers. There are needs in just over 180 occupations.

FurthermoreSuppliers are much needed, not least within construction and in the major ongoing projects in the Swedish ore fields.

LKAB Trading Shanghai

Support & Purchasing Development

C Purch.

Material supply chain

Investments & Urban transformation

Strategic Purchasing

Operating Purchases

Energy, Raw Materials& Additives

LKAB Purchase Organisation

TRANSFORMATION

• Price negotiations• Monitoring deliveries • Administration• Waiting for assignments• Working independently• Involved late in the process

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Now

• Long-term solutions, focusing on the total cost• Developing ourselves and suppliers• Global market knowledge• Interaction between internal customers and

purchasers• Early involvement in processes• Sustainability is a natural part of the business

Before

INCREASE COOPERATION WITH THE SUPPLIER BASE

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LKABSupplier

Increased cooperation

LKAB’s customers

• Lower total cost

• Higher productivity

• Improved quality

• Shorter lead times

• Increased value

• Higher customer satisfaction

• Increased competitiveness

” Business development is one of the most important activities to strengthen our competitiveness”

• Safety

• Sustainability

• Innovation

• Attractive LKAB

Purchasing

HOW DOES A COMPANY BECOME AN LKABSUPPLIER?

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Go to www.lkab.com

Click on “supplier”

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On this page you will find

information for LKAB suppliers. It also contains information for

prospective LKAB suppliers.

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Then click on “supplier portal”. Here

you can create an account,

which you will need to do

before you can become an

LKAB supplier.

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Log in here or create an account for LKAB’s

supplier portal.

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You have now created an account for your company on

LKAB’s supplier portal. In doing so, you have also declared your

acceptance of LKAB’s Basic Requirements for Suppliers.

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Only one acceptance per company is required. It is OK, however, for the Basic Requirements to be accepted by several different users at the same company.

You will need to accept the Basic Requirements for the whole of your company. You will also need to accept the Basic Requirements for any specific tenders that

you submit via the supplier portal.

If you would like your company to be an LKAB supplier, you must first accept the Basic Requirements for the whole of your company. In doing so, you confirm that your company complies with these Basic Requirements. LKAB’s Purchasing department

will then follow a process to potentially add you as an LKAB supplier.

All existing LKAB suppliers must accept the Basic Requirements for their company. All companies wishing to be an LKAB supplier must accept LKAB’s Basic

Requirements for their company.

INFORMATION 28/10/2014

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Any questions?

For technical support concerning the portal:

Click on “contact us” at the bottom of the

supplier portal.

For questions about tenders and requirements

specifications:

Contact responsible purchaser.

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THANK YOU FOR YOUR ATTENTION!