INVESTING IN SUSTAINABLE GROWTH Australian Zinc Briefing : 20 - - PowerPoint PPT Presentation

GROWTH INVESTING IN SUSTAINABLE

Australian Zinc Briefing : 20 February 2008

Len Jubber - CEO Bruce Hooper – GM Exploration

Slide 2

Corporate overview

100 200 300 400 500 600 Feb 2007 May 2007 Aug 2007 Nov 2007 Feb 2008

500 1000 1500 2000 2500 3000 3500 4000 4500 5000

Perilya Zinc Price Lead Price

10.9% 8.6% 5.6% 2.3% AXA Group Barclays Global Investors Delta Partners Board & Employees

Key Shareholders (as at 31 Jan 2008)

PEM 196m 4.3m A$314m 1.1m ASX Shares on issue Options Market capitalisation

(undiluted at $1.60 per share)

12 month ave daily turnover:

Capital structure (as at 19 Feb 2008)

Broken Hill Flinders Mount Oxide Growth Corporate

$136m $28m 94kt zinc Cash Debt Beltana zinc stockpile

“Balance Sheet” (as at 31 Dec 2007)

Slide 3 Note : Cu as at Feb 2008 Zn, Pb as at 2006/07

Operating Operating Projects Projects Exploration Exploration

Tampang (Cu, Au) Tampang (Cu, Au)

Mount Oxide (Cu) Mount Oxide (Cu)

Beltana (Zn) Beltana (Zn) Broken Hill (Zn, Pb, Ag) Broken Hill (Zn, Pb, Ag)

Dee Range (Cu, Zn) Dee Range (Cu, Zn)

Potosi (Zn, Pb, Ag) Potosi (Zn, Pb, Ag) North Mine Deeps (Zn, Pb, Ag) North Mine Deeps (Zn, Pb, Ag)

Flinders (Zn) Flinders (Zn)

Operating Operating Projects Projects Exploration Exploration

Tampang (Cu, Au) Tampang (Cu, Au)

Mount Oxide (Cu) Mount Oxide (Cu)

Beltana (Zn) Beltana (Zn) Broken Hill (Zn, Pb, Ag) Broken Hill (Zn, Pb, Ag)

Dee Range (Cu, Zn) Dee Range (Cu, Zn)

Potosi (Zn, Pb, Ag) Potosi (Zn, Pb, Ag) North Mine Deeps (Zn, Pb, Ag) North Mine Deeps (Zn, Pb, Ag)

Flinders (Zn) Flinders (Zn)

Mount Oxide (Cu) Mount Oxide (Cu)

Ore Reserves

0.0 0.2 0.4 0.6 0.8 1.0 Zinc Lead

Broken Hill Flinders Mount Oxide Growth Corporate

Mineral Resources

0.0 0.5 1.0 1.5 2.0 2.5 Zinc Lead Copper

Slide 4

Perilya

exposure to base metals

Broken Hill – 13th largest zinc mine Developing new ore sources at Broken Hill Stage 1 – Beltana open pit successfully completed Broken Hill – 6th largest lead mine :

• resource upside as

focus in recent decades has been on zinc

• leverage to upside

through put options, down side protection Mount Oxide:

• resource upgraded

to 203,000t Cu

• potentially low

development threshold

• Including 8,300t

cobalt & 4.2moz Ag Broken Hill Flinders Mount Oxide Growth Corporate

150 300 450 600 750 Feb 05 Feb 06 Feb 07 Feb 08

LME Stockpiles (kt)

1,000 2,000 3,000 4,000 5,000

Zinc Price (US$/t)

Zinc

25 50 75 100 125 Feb 05 Feb 06 Feb 07 Feb 08

LME Stockpiles (kt)

1,000 2,000 3,000 4,000

Lead Price (US$/t)

Lead

50 100 150 200 250 Feb 05 Feb 06 Feb 07 Feb 08

LME Stockpiles (kt)

2,000 4,000 6,000 8,000 10,000

Copper Price (US$/t)

Copper

Slide 5

Broken Hill

Developing new ore sources

5 km

North Mine Southern Operations

City

Potosi

Piesses Knob

Flying Doctor

Southern Ops Extensions

Stirling Vale 1130 Smiths Sam Deeds Henry George Monarch Flat Exploration targets

Concentrator

Surface projection of ore bodies Perilya Broken Hill Mining Lease Existing Operations

Broken Hill Flinders Mount Oxide Growth Corporate

North Mine Deeps

Feasiblity Study

Slide 6

0.52 Mt @ 5.4% Zn, 7.1% Pb 72 g/t Ag

Potosi Resource

2.36 Mt @ 11.7% Zn, 4.6% Pb 54 g/t Ag

Flying Doctor Resource

Potosi & Flying Doctor

targeting 6mt @ 10-12% zinc and 3-5% lead

Broken Hill Flinders Mount Oxide Growth Corporate

Slide 7

Low risk approach to North Mine Deeps

Broken Hill Flinders Mount Oxide Growth Corporate

Ventilation shaft provides return airway for Decline and No3 shaft Shaft provides initial access for dewatering Mine Shaft re-commissioned to 22 level - Rock hoisting

• nly with wire-rope guides

Extended Decline provides access to ore body extremities Current Decline 2 Lens 3 Lens Water level North Mine Deeps

North Mine

Fitzpatrick

Vent Shaft No 3 Shaft No 2 Shaft No 1 Shaft

3.7mt @ 24.7 % Zn + Pb Indicated / Inferred Resource

Slide 8

Broken Hill

Pinnacles Region

Major Potential Between, ie Smiths, Sam Deeds

6m @ 9.3 % Zn

Henry George Sam Deeds Smiths 11:30

Broken Hill Flinders Mount Oxide Growth Corporate

6.6m @ 11.7 % Zn

2.7 m @ 13.5 % Zn

Slide 9

Henry George

large system over 700m long, grade increasing with depth

Broken Hill Flinders Mount Oxide Growth Corporate

200m

6.6m @ 11.7 % Zn 3.8 m @ 12.3 % Zn Grade of Zinc Open to Depth

Slide 10

11:30 Deposit

high grade near surface narrow intercepts

Broken Hill Flinders Mount Oxide Growth Corporate

200m

1.3 m @ 33.7 % Zn 2.7 m @ 13.5 % Zn Grade of Zinc

Slide 11

Flying Doctor

Value of spare Broken Hill concentrator equates to

~ A$150mpa, ~ US$0.20/ lb zinc

North Mine Deeps 0.2 – 0.4 Mt per annum North Mine Deeps 0.2 – 0.4 Mt per annum North Mine 0.1 – 0.2 Mt per annum North Mine 0.1 – 0.2 Mt per annum Southern Operations 1.6 – 1.8 Mt per annum Southern Operations 1.6 – 1.8 Mt per annum Potosi 0.2 – 0.4 Mt per annum Potosi 0.2 – 0.4 Mt per annum

evaluating existing

• re feed

Broken Hill Concentrator

2.8 Mt Capacity

Southern Operations North Mine North Mine Deeps

Satellite open pitable deposits–Henry George? Satellite open pitable deposits–Henry George? Flying Doctor 0.15 – 0.35 Mt per annum Flying Doctor 0.15 – 0.35 Mt per annum

Broken Hill Flinders Mount Oxide Growth Corporate

Potosi

Slide 12

Flinders zinc oxide proj ect

Existing infrastructure + direct high grade ore shipping + high Zn price = superior IRR

Rail line Tenements Rail line Tenements

Broken Hill Flinders Mount Oxide Growth Corporate

Slide 13

Intermediate Grade Product 316kt @ ~ 32% = 101kt metal MARKETING

Reliance

387kt @ 27.6% Zn = 105 Kt metal

Other

235kt @ 30.2% Zn = 71 Kt metal

Stage 2

Evaluate potential of deposits along strike

Stage 3

Evaluate beneficiation

Flinders 966kt @ 31% Zn = 300kt metal

Low Grade Product > 15% zinc UNMARKETABLE High Grade Product > 35% zinc MARKETABLE

Direct ore shipping

separate stockpiling creates marketing opportunities

Broken Hill Flinders Mount Oxide Growth Corporate

Stage 1 - Beltana

376kt @ 32% Zn

Slide 14

S tage 1 –Beltana

• Stockpiled 316,400t

@ 32% zinc (101kt contained zinc)

• Cash cost US$0.65/lb

zinc

• Completed within year

Rail Road 5 km Exploration targets Operation Relative scale of current resource Development targets

Leigh Creek

Beltana Mine

Reliance Moolooloo Aristotle Aroona II Tom Thumb Aroona Sundown Wallrider

Leigh Creek

Beltana Mine

Reliance Moolooloo Aristotle Aroona II Tom Thumb Aroona Sundown Wallrider

Broken Hill Flinders Mount Oxide Growth Corporate

Slide 15

Pit optimisation indicates strong cash flow with 100m deep pit

Broken Hill Flinders Mount Oxide Growth Corporate

Stage 2 – Reliance

Drilling completed Resource update underway Intercepts include : 79m @ 35 % Zn 21m @ 48 % Zn Hydrology modelling underway Feasibility Study Underway

Slide 16

Mount Oxide

advanced copper proj ect

• Mt Isa region
• Close to existing infrastructure
• Resource recently upgraded
• Exploration camp under construction
• Infill and extensional drilling April
• Scoping Study March Qtr 2008
• Permitting advancing
• Feasibility Study June 2009

Broken Hill Flinders Mount Oxide Growth Corporate

Slide 17

Mount Oxide

resource open in all directions

Broken Hill Flinders Mount Oxide Growth Corporate

Table 1: Mount Oxide Mineral Resource Estimate at 0.2 % Cu cut off

Classification M Tonnes Cu % Co % Ag g/t Copper Contained t Cobalt Contained t Silver Contained oz Indicated 9.8 1.6 0.05 12 154,000 5,200 3,430,000 Inferred 5.7 0.9 0.05 4 47,000 3,100 770,000 Stockpiles 0.3 0.7

• 2,000
• Total

15.5 1.3 0.05 9 203,000 8,300 4,200,000

• 80 % increase in contained copper
• 60% in Indicated Category
• Scoping study looking at metallurgy, geotechnical and economics
• Potential bi-products

Slide 18

Mount Oxide

Mount Oxide Resource model looking North in 3d, demonstrating the relationship of shallow and low angle stratigraphic mineralised lenses and vertical structures at depth

Broken Hill Flinders Mount Oxide Growth Corporate

300 metres

Slide 19

Mount Oxide

Mount Oxide Resource model looking West in 3d, demonstrating the potential to the North in a sparsely drilled area

Broken Hill Flinders Mount Oxide Growth Corporate

300 metres Target zone for 2008 W N

Slide 20

Exploring Feasibility Developing Operating

Perilya

suite of exploration, development & operating assets

Broken Hill Flinders Mount Oxide Growth Corporate Mount Oxide Pinnacles Reliance North Mine Deeps Flying Doctor Potosi North Mine Southern Ops

Zinc, Lead Zinc Copper

Slide 21

ORGANIC GROWTH

BROKEN HILL (NSW)

• Potosi exploration

decline

• Flying Doctor feasibility

study

• North Mine Deeps

feasibility study

• North Mine decline
• Pinnacles exploration

MOUNT OXIDE (QLD)

• 80% Resource upgrade to 203kt
• Scoping study in Mar Q 08
• Infill drilling 2008

FLINDERS (SA)

• Stage 1: Beltana

― Stockpiled ~ 100kt zinc at Beltana ― Two direct ore spot sales to date ― Padaeng off take agreement

• Stage 2 : Reliance

― Feasibility study

Investing in three core assets

Broken Hill Flinders Mount Oxide Growth Corporate

GROWTH INVESTING IN SUSTAINABLE