School of Mines Thursday, 23 November 2017 Grand Hyatt Singapore. #schoolofmines17

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1 School of Mines Thursday, 23 November 2017 Grand Hyatt Singapore #schoolofmines17

2 PwC School of Mines 2017 Welcome Address The trick to seeing the future is knowing where to look for it Jock O Callaghan Global Mining and Metals Leader, PwC

3 State of Play PwC School of Mines Singapore Review of global trends and issues facing the mining industry November

4 In June 2017 : Stop. Think Act Recovering from 2015 s race to the bottom, the members of the Top 40 paused and drew breath in Stop Think Act 4 PWC

5 Stop

6 Balance sheets strengthened 6 PWC

7 Alleviating distress 7 PWC

8 The old guard have donned hard hats, high viz jackets and steel-capped boots in a bid to protect themselves from the pitfalls of the recent past 8 PWC

9 Impairments significantly reduced, but so was capex 9 PWC

10 Exploration budgets Looking for safety Top Destinations for Mining Exploration The US showed the sharpest pullback in exploration last year, with its budgets falling more than 30%, although gold and copper exploration helped the country account for a 7% share of the global total. Nevada had the largest share (47%) of the US budget, with two other states, Arizona and Alaska, together accounting for a further 22% of the total. Other locations account for 3% 10 PWC

11 Fire sales dampened Notable transactions among Top 40 miners Early in 2017, Shandong Gold Mining Co. Limited (Shangdong) acquired a 50 percent stake in the Veladero gold mine from Barrick Gold Corporation (Barrick). 11 PWC

12 China

13 China Bucking the trend 13 PWC

14 Think

15 There are both opportunities and hazards on the horizon MINING NEWS Apple asks: Can we one day stop mining the Earth altogether? Elon Musk puts forward a 100-day guarantee to fix a state s energy crisis with battery technology 15 PWC

16 Act

17 Will herald the digital revolution in mining? New technologies promising a boost for the sector include software to optimise asset utilisation devices to remotely monitor and control activities robotics for the automation of repetitive tasks. 17 PWC While new technologies can be costly to acquire, implement and maintain, the payoff can be significant. Mining companies that genuinely understand technology, and leverage it strategically, will benefit the most.

18 What else has changed since Mine was released? Have our views changed? Has anyone taken ACTION? Things to include on the industry dashboard: Sovereign risks Environmental pressures Exploration flat Bright spots Zinc, Copper, Nickel Some rebalancing of portfolios Prices Graduate intake declining Governance 18 PWC

19 Top 10 go forward issues for Miners Trust Transparency External forces * We need to talk about the future of mining 19 PWC

20 Top 10 go forward issues for Miners 1. The next deal/project better be a good one! 2. How to build a culture for a new world 3. Safety, safety, safety 4. The impact of newcomers and interlopers 5. Where to deploy surplus cash? 6. Security of operations 7. Attracting talent and delivering diversity 8. Becoming a partner of choice 9. Agility 10. Collaborating to protect the mining brand 20 PWC

21 Q&A pwc.com/mining 21 PWC

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