ENDURING

VALUE
THROUGH
VALUES

Jeyakumar Janakaraj

Akhil h Joshi
Akhilesh J hi

October 9,
9 2008
Vision & Mission

VISION

Be a world-class company, creating value, leveraging mineral

resources and related core competencies

MISSION

■ Be a globally lowest cost zinc producer, maintaining market

leadership
■ One million tonne Zinc-Lead metal capacity by 2010.
■ Be innovative
innovative, customer oriented
oriented, and eco
eco-friendly
friendly maximizing
stake-holder value.
World Class Mining Assets
Rajpura Dariba Mine
Lead-Zinc Ore R&R:
Reserves: 7.1 Mt
Resources: 17.6 Mt
Zinc Grade: 6.6%
Lead Grade: 1.7%
Ore Production Capacity:
0.60 mtpa. Will increase to
0 9 mtpa
0.9
Sindesar Khurd Mine
Lead-Zinc Ore R&R:
Reserves: 1.96 Mt
Resources: 35.2Mt
Zinc Grade: 5.8%
Lead Grade: 3.8%
Silver Grade: 215 ppm
Ore Production Capacity:
0 3 mtpa.
0.3 mtpa Will increase to 1.5
15
mtpa
Rampura Agucha Mine
Lead-Zinc Ore R&R:
Reserves: 63.6 Mt
Resources: 43.8 Mt
Zinc Grade: 13.9%
Lead Grade: 2.0%
Ore Production Capacity:
5.0 mtpa. Will increase to 6.0
mtpa
Kayar Mine
Kayar Mine
Resources: 9.01 Mt,
Grade: 10.6%, Zn,1.7% Pb
0.3 mtpa Capacity
Zawar Mining Complex
Lead-Zinc R&R:
Reserves 7.2 Mt
Resources: 41.9 Mt
Zinc Grade: 4.4%
Lead Grade: 2.3%
Ore Production Capacity:
1.2 mtpa
CPP: 80 MW
Note: Map not to scale
Kayar Mine is under implementation
World Class Smelting Assets

Chanderiya Complex Debari Smelter

Pyrometallurgical Lead Zinc Smelter: Hydrometallurgical Zinc Smelter:
105,000 tpa Zinc 88,000 tpa Zinc
35,000 tpa Lead 419,000 tpa Sulphuric Acid
120 tpa Silver Captive Power Plant: 29 MW
Hydrometallurgical Zinc Smelter:
420,000 tpa Zinc
AusmeltTM Lead Smelter:
50 000 tpa Lead
50,000
851,000 tpa Sulphuric Acid
Captive Power Plant: 234 MW

Dariba Complex – Phase III

Hydrometallurgical Zinc Smelter:
210,000 tpa Zinc
Lead Smelter Vizag Smelter
100,000 tpa Lead
Silver Refinery Hydrometallurgical
g Zinc Smelter:
350 tpa Silver 56,000 tpa Zinc
Captive Power Plant: 160MW 91,000 tpa Sulphuric Acid

Note: Map not to scale

Dariba Smelting Complex is under implementation
Growth

Note: COP is excluding royalty

Mined Metal ( ' 000 tonnes)
700 700
Refined Metal ( ' 000 tonnes)
629 686
cost of production (USD/t) 680
600 572
532 660

500 485
639 640
(‘000 tonnes)

409
393 620

(US $/t)
400 612
600

$
t

308
300
577 580
228 575

200 560
158 145
540
100
520

0 500
FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 Q1
Rampura Agucha – Lowest cost producer

4000.0
Zinc Mining C1 Cash Cost Curve 2007
3500.0
ning Cash Cost $/t

3000.0 20% of global production precariously poised at current LME prices

2500 0
2500.0
80th
Percentile
2000.0 ($/t) 1187.6

50th
Zinc Min

1500.0 Rampura Percentile

Agucha ($/t) 704.8
($/t)132.6
1000.0

500.0

0.0
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Cumulative production percentile

Source: Brook Hunt 2007 Edition

Mining Cost Curve
Smelting Cost in 1st Quartile

80th Percentile
50th Percentile 26.1 c/lb
21 5 c/lb
21.5 /lb
18.9 c/lb

Source: Brook Hunt 2007 Edition Smelting Conversion Cost Curve

 Focus on Developing Resources

HZL R&R - Three pronged approach

■ In mine exploration
■ Near mine exploration
■ Greenfield exploration (area applied in India – zinc rich belt)
232.3
230 Resources Reserves 209 4
209.4
177.6
180
onnes

164.8
143 7
143.7 146.3 152
Million to

133
130 109
98
87 92
80

67 69 77 80
57 54
30
FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008

■ Metal content - 27.5 Mt of zinc-lead

■ Rampura Agucha mine achieves landmark of crossing 100 million tonnes of R&R

Overall R & R increased by 115 million tonnes , pre-depletion of 26.4 million tonnes.
Capacity Build Up

1000

900 879

800 2002 2008 2010

700 669

600
530
500 474

400
314
300

169 185
200
120
85 70
100
35
0
0
Zinc ('000 t) Lead ('000 t) Silver (t)* Power (MW)

*Silver production
*Sil d ti capacity
it iis iin th
the year 2012
Power – thermal power
Robust Zinc Demand

Per capita zinc consumption in 2007 (kg/capita)

11.3 3%

5.0 1%
3.2 2.7 18
1.8 3% 0.4

South Korea Japan USA China World India

PROMISING FUTURE

■ Global consumption is growing @ 3 – 4% CAGR,

CAGR world needs ~0.5
0 5 Mt more zinc every year
■ Indian consumption at ~ 0.47 Mt in FY 08 is expected to grow at double digit. Likely to
double in 5-6 y
years at the back of strong
g demand drivers:
− Low per capita consumption in India coupled with a growth in
infrastructure, construction, consumer durables, automobiles etc.
■ Zinc does not have a risk of substitution
Silver – A New Dimension

■ Currently largest primary silver producer in India : 3.7 million ounce per annum

■ Silver production to rise to 17.0 million ounce per annum by 2012

− Major additions from Sindesar Khurd Mine expansions having high

silver grade ore of ~ 215 ppm

− R
Recovery off silver
il ffrom H
Hydro
d zinc
i smelter
lt circuits
i it

− Overall increase in mine production largely from Rampura Agucha

expansion from 5.0 mtpa to 6.0 mtpa

■ Setting up 350 tpa new silver refinery as a part of lead smelting expansion
Silver Output – Ramp-up Plan

ƒ Mile Stone 1: Silver recovery from zinc smelter circuits as low

grade lead concentrate
ƒ Mile Stone 2: Silver from new zinc and lead smelters along
with silver refinery and expansion of mines
ƒ Mile Stone 3: Silver from fully ramped up expanded Sindesar
Khurd Mine

6.1

48
4.8 17 0
17.0

2.2

3.9

C
Current
t Capacity
C it Mil Stone
Mile St 1 Mil Stone
Mile St 2 Mil Stone
Mile St 3 T t l
Total

Note: Units are in million ounce per annum

Best Zinc People in the World

„ Organization Structure enhancing performance

FRESHERS HIRING (2002-2008)
- Empowered SBU work culture
- Leadership development for succession planning
- Talent identification, positioning and rewards 587
600
- Performance oriented online appraisal.
500
„ Competence Building
- Over 1,000 employees have undergone specially 400
319
designed general management & technical training
programme. 300

- To attract best talent at induction level

200
− Qualification of fresh joinees – First Class Graduate 70
100 29
- Accelerated development of executives through 17
specialized programmes at reputed institutions - IIM /
0
IIT / ISM / BITS GETs B.Sc., MBA CA Others
B.Com
B Com
- Exposure to other world-class operations
„ Cutting edge combination of experienced and young
engineers in expertise & energy levels
„ Tremendous focus on quality of life
Focus on Safety
30
25
25 Nearly 50% reduction in LTIFR every year

20

R*
LTIFR
15
11
10
5.46
5 3 07
3.07

0
FY 05 FY 06 FY 07 FY 08

■ Robust safety policy, practices organization - supported by safety stewards.

■ Increased focus on the behaviour based safety program of all employees.
■ Daily Safety performance review in unit meetings with total engagement of employees.
employees
■ External HSE audits are being done by agencies of international repute – PwC, E &
Y, B.S.C
■ Proactive
P ti actions
ti like
lik analysis
l i off near miss
i incidences,
i id periodical
i di l iindependent
d d t
reviews, regular training etc.
■ Equal focus on contract workmen’s safety
■ C
Compulsory
l use off Personal
P l Protective
P t ti Equipment
E i t (PPE) iincluding
l di b
by contract
t t workmen.
k
■ No cases of occupational health diseases
*Lost Time Injury Frequency Rate
Corporate Social Responsibility

Impacting Over 500,000 lives

covering
i 173 Villages
Vill

Below Poverty Line (BPL)*

Self Help Group

70 61.79
60
%)
BPL (%

50
40 27.10
30
20
10
0
FY 2005 FY 2007
Year Child Welfare Centre

*Families with monthly income less than Rs. 2,000/- (~US$ 50) are considered BPL as per Govt. guidelines
Corporate Social Responsibility - Snapshot

ƒ Mid Day Meal - More than 200,000 primary school going children are being benefited
th
through
h 6 Hi-
Hi Tech
T h Kit
Kitchens
h established
t bli h d b
by HZL
ƒ 400 (increasing to 1,000) Anganwadi Centers adopted by HZL, benefiting around 16,000
children
1 000 computers installed in rural Government schools creating learning opportunities
ƒ 1,000
covering more than 40,000 children
ƒ Covering 173 villages and among them transforming 59 poverty stricken villages into model
g based on socio-economic indicators
villages
ƒ 32 villages transformed to model villages and audited by ORG, New Delhi (>75% success)
ƒ Post Graduate Girls College in Ringus serving around 900 students coming from rural area
Awards & Recognition

„ Ranked # 1 metals & mining company in India - # 2 in Asia - overall business ranking
# 17 in Asia by Business Week – BW, 2008.
„ Dun & Bradstreet - American Express Corporate Award 2007 for Top Indian Company in
the Non-Ferrous Metals Sector.
„ Process Excellence Award – By International Quality & Productivity Centre, London in
2008
„ TERI Corporate Social Responsibility Award 2007 by Hon’ble Finance Minister of India.
„ FICCI-SEDF Corporate Social Responsibility Award 2006 by Hon’ble President of India.
„ FIMI National Social Awareness Award 2006
„ FIMI Corporate Social Responsibility Award 2007
„ FIMI Excellence Award for the year 2007
2007-08
08 to Rampura Agucha Mine.
„ Golden Peacock National Training Award 2006.
„ Golden Peacock Corporate Social Responsibility Award 2007
„ P
Pegasus C
Corporate
t SSocial
i l Responsibility
R ibilit Award
A d 2007
„ ‘Asian Power Plant of the Year 2007’ and ‘Best Emission Reduction Project in Asia’ to
Chanderiya Captive Power Plant by Asian Power, Singapore
Chanderiya Smelting Complex
World’s Largest Zinc Smelting Complex

Pyro Lead Zinc Smelter Hydro Zinc Smelter Captive Power Plant
Imperial
p Smelting
g Technology
gy RLE* Technology,
gy, Outotec Bharat Heavy Electricals Ltd (BHEL)
ƒ Commissioned in 1991 ƒ Commissioned in 2005 / 2007 ƒ Commissioned in 2005 / 2008
ƒ 105 KTPA Zinc, ƒ 2 x 210 KTPA Zinc, ƒ 77 + 77 + 80 MW (234 MW)
ƒ 35 KTPA Lead ƒ Best & Proven Technology ƒ Proven Technology
Ausmelt Lead Smelter ƒ Recovery +96% ƒ Operation outsourced to Korea
ƒ Commissioned in 2006 Power Services
ƒ Cansolv Technology
ƒ eco e y +97%
Recovery 97%
ƒ 50 KTPA Lead * RLE: Roast Leach Electro-winning

Operational Excellence:

■ Reduced specific power consumption by 335 kwh/t of zinc cathode in Hydro smelters (FY08)
■ Reduced specific water consumption by 0.6 m3/t of zinc (FY 08)
■ Increased byproduct recoveries eg., cd, cu, Ag, etc
■ Lead- Silver residue recovery in Hydro plant has been implemented
■ Six Sigma culture for problem solving, for instance, silver refinery cycle time reduction from
60 hrs to 20 hrs
Environmental Focus – Smelters

ƒ Lowest SO2 emission

ƒ Latest technology (Jarofix) - eliminates hazardous waste

generation

ƒ Zero discharge
g leading
g to reduced specific
p water consumption
p

ƒ World’s largest and latest generation roasters

ƒ Extremely efficient waste heat energy recovery system coupled

with power generation
Solid Growth with Low Risk
Delivered Under Implementation

Chanderiya Chanderiya Chanderiya Chanderiya & Dariba Zinc &

Hydro I Ausmelt Lead Hydro II Debari Zinc Lead Smelter
S
Smelter
l Debottlenecking
b l ki
50 ktpa 170 ktpa 88 ktpa 210 & 100 ktpa
170 ktpa

2005 2006 2007 2008 2010 2012

Rampura Rampura Agucha Rampura SK Mine expansion

Agucha Mine Mine expansion Agucha Mine
0.3 mtpa to 1.5
expansion expansion
mtpa
2.3 mtpa to 5 mtpa to 6
3.75 mtpa to 5 New Mine at Kayar
3.75 mtpa mtpa
mtpa 0.3 mtpa

Chanderiya Chanderiya & Dariba CPP

CPP Zawar CPP expansion
expansion
2 x 77 MW 2 x 80 MW

2 x 80 MW

Gujarat & Karnataka Wind

Power Plant 124 MW
Mission – One million tonnes

Zinc/Lead – Capacity

Zinc Phase III

Zinc – Expansion 100 ktpa 1,064 ktpa
Project capex: US $ 900 million
Lead 210 ktpa 100 ktpa
Lead– Expansion 185 ktpa
■ 210,000 tonnes Hydro Zinc Smelter at
210 ktpa Rajpura Dariba
754 ktpa
■ 100,000 tonnes Lead Smelter at
85 ktpa
Rajpura
jp Dariba

■ 80 X 2 MW Captive Power Plant at

Rajpura Dariba
879 ktpa
■ Sindesar Khurd Mine expansion to 1.50
669 ktpa
mtpa from 0.30 mtpa

■ Rampura Agucha Mine expansion to

6.0 mtpa from 5.0 mtpa

■ Opening of a new mine at Kayar with

Current Capacity Zinc Expansion Lead Expansion Metal 2010 p y of 0.3 mtpa
an initial capacity p
Project Execution Philosophy

■ Split between basic engineering & detail engineering

■ Critical path analysis & de-bottlenecking at every phase

■ Parallel engineering, procurement & construction

■ Best in Class p
project
j p
partners like L&T, Outotec, BHEL, ABB etc.

■ Community participation –involvement & job creation opportunities for local people

■ Successful sourcing from Indian vendor base by our global suppliers - saving time & cost

■ Independent Project audit & review mechanism

■ Close
Cl & Proactive
P ti working
ki with
ith vendors,
d close
l watch
t h on progress to
t avoid
id surprises.
i

■ Dedicated & young energetic project management team

Project – Track Record

Hydro I Smelter commissioned in 22 months Hydro II Smelter commissioned in 20 months
Industry leading capex cost of US $ 1,100 /t of zinc
Largest Integrated Zinc - Lead Producer – 2010
kt Zn

Hindustan Zinc 633 1064

Xstrata AG 1002

Glencore 490

Teck Cominco 380

New Boliden 322

0 200 400 600 800 1000

Source: Brook Hunt Q3

Rampura Agucha Mine

A world class zinc asset

9 Third largest zinc mine in the world – Will be the largest by 2010
9 One of the lowest cost zinc mine
9 Modern efficient mining operations
9 Crossed the landmark of 100 million tonnes of R&R
Rampura Agucha Mine - An Overview

Commissioned : 1991

Location : 225 km north of

Udaipur, Rajasthan, India

Reserves : 63
63.6
6 million tonnes
(13.0% Zn, 2.0% Pb)

Resources : 43
43.8
8 million tonnes
(15.3% Zn, 2.0% Pb)

Ore Production :5
5.00
00 mtpa and is being
enhanced to 6.00 mtpa

Certification 9001:2000 ISO

: ISO 9001:2000,
14001:2004, OHSAS
18001:1999, 5 S certified
Rampura Agucha Mine - An Overview
ƒ Mine pit dimension
ƒ Bench height
ƒ Berm width and bench angle
ƒ Ultimate pit wall slopes
H/W
F/W
ƒ Pit access
ƒ Ultimate depth of pit
ƒ Overall stripping ratio
ƒ Waste Management
: 1580 m x 680 m
: 10 m in Ore ; 10 m in Waste
: 6.5 m from top to 290 mRL,
: 10 m below 290 mRL,
: Individual bench angle 70° at F/W & 80° at H/W
: 48
48°
: 35°
: Ramp one each in H/W & F/W,
: width 25 m , gradient 1 in 12.
: 270 meters from surface plan
: 1:4.69
: 4 X 10 m lift, with overall slope angle of 27 °
Largest Zinc Mines

2008 E 2010 E

Red Dog 553

Rampura Agucha 570

Century 518 Red Dog 565

Rampura Agucha 500 Century 500

Antamina 360 Mount Isa Pb/Zn 395

Mount Isa Pb/Zn 285 Antamina 335

100 300 500 700 100 300 500 700

Note: All figures

g are in Kt Zn
Source: Brook Hunt 2008 Q3
Metal Recovery
Zinc
i recovery : Rising trend of Zinc Recovery %
ƒ Consistency in operation & ore feed
ƒ Regrinding of zinc scavenger & cleaner
92.00 92.19
concentrate
90 98
90.98 91 20
91.20
ƒ Capturing more liberated particles.
90.38
ƒ Construction of clarifier to capture fine 89.80
particles of concentrate going back into
recirculation
ƒ Circuit modification of scavenger
avoiding re-circulating load. 2003 2004 2005 2006 2007 2008
ƒ Continuous mineralogical auditing to
identify mode of losses and plugging
them

Lead recovery: Rising trend of Lead Recovery %

ƒ Fine primary grinding from 79 microns
to 72 microns 60.40 61.17
59.01 59.62
ƒ Circuit modification 58.50
ƒ I t d ti
Introduction off automation
t ti in
i cleaner
l
54.69
circuit
ƒ Introduction of double launder
system
ƒ Continuous
C ti Mineralogical
Mi l i l auditing
diti tto
2003 2004 2005 2006 2007 2008
identify mode of losses and
plugging/controlling
Note: The year mentioned is in Fiscal
Conservation of Energy & Water
Reduction in specific energy consumption E
Energy R d ti
Reduction:
kwh/tonne of ore treatment
42.69 ■ AC variable speed drives (25 nos.)
41 42
41.42 ■ Optimization
O ti i ti off pumps speed.
d
41.03
39.63 39.52 ■ By maintaining system power factor 0.99
38.13 ■ Optimization of grinding media size and &
charge
■ Employee participation through Six Sigma

FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008

Reduction in specific water consumption

Water Reduction
m3/tonne of ore treatment
1.30
■ Recoup from tailing dam
0.97
0.87 ■ Zero discharge
g of water through
g recycling
y g
0.66 ■ Water reservoir of 50,000 m3 for storage of all the
0.55 0.50
water to reduce the evaporation.

■ Garland drains all around the mine pit and

waste dumps. Collected water is pumped to
FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008
the reservoir for re-use.
 Productivity Improvement

350 4.07 4.5

3.75
4
300 3 50
3.50

uction (Mt))
3.5
250
3
2.45
200 2.2
. 25
2.5
OMSS

Ore Produ
1.77 319 2
150
274
245 1.5
100 185
142 145 1
50
0.5
0 0
FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008

OMS Ore Production (Mt)

* OMS : Output per man per shift; Mt : Million tonnes
Focus on Environment - Mines

■ Dust Prevention Tailing pond of Zawar Mines

− Wet drilling operations

− Water sprinkling on Haul Road
− Dust Extraction systems at crushers
− Chemical treatment of haul roads

■ Aforestation around the mine periphery

■ Tailing dam with continuous monitoring

− Rock filled with lining
− Designed by experts from Central Water Commission and Indian Institute
of Science, Bangalore.
− LDPE lined for seepage
p g control

■ Systematic stacking of waste and vegetation over inactive benches

■ Adopted recycling and reuse of Water for Zero discharge

Sindesar Khurd Mine

Sindesar Khurd

Rajpura Dariba Mine

Longitudinal Vertical Section – SK Mine

Depth Sindesar Khurd Longitudnal Vertical Section mRL

S N
Ramp
Vent. raise
Incline
BH-4 BH-1 BH-2 BH-3

Mt Zn % Pb % Ag ppm
Proved & Probable Reserves 1.96 5.32 2.08 117
M&I Resources 21.01 6.37 4.05 235
Inferred Resources 14.20 4.99 3.80 199
Total R&R 37.17 5.8% 3.8% 215
Sindesar Khurd Mine

Drilling Total R&R

UOM meters million tonnes

FY 2005 710 13.50

FY 2006 5,634 13.62
FY 2007 18,174 30.85
FY 2008 26,066 37.17
50,584

Note: R&R as on 31 March of respective fiscal year

Sindesar Khurd Mine

2005 2006 2007 2008

■ Reserves & Resources 13 5

13.5 13 62
13.62 30 85
30.85 37 17
37.17

- Potential to add further

Capacity:

- Current 0.3
0 3 million tonnes per annum
- Expanded 1.5 million tonnes per annum

■ Schedule completion
p 2012

■ Partial production from 2010-2011

Thank You