sales & marketing - OZ Minerals
SALES & MARKETING 1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
RUSSELL GRIFFIN GM Sales & Marketing
OZ MINERALS • NOVEMBER 2009 • PAGE 31
STRATEGY SUPERIOR TOTAL SHAREHOLDER RETURNS
ZERO HARM
FOCUS ON COPPER
MAXIMISE POTENTIAL OF ASSETS
BUILD A PROJECT PIPELINE
INVEST IN EXPLORATION
DISCIPLINED CAPITAL MANAGEMENT
FOUNDATION BUILT ON GOVERNANCE OZ MINERALS • 30 NOVEMBER 2009 • PAGE 32
SALES & MARKETING OF CONCENTRATES Responsible for: − Sales & logistics − Setting and implementing marketing plan, 3-5 years − Negotiating terms • frame, annual, spot − Match sales to production − Administering sales • 2 ships/mth & domestic sales − Shipping and freight
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 33
Port of Darwin
PROMINENT HILL CONCENTRATES SALES AND MARKETING Sales plan & feasibility study - years 2006-8 Metallurgical test-work determined likely product quality − Initial assay from laboratory ‘pilot’ using drill-core − Representative samples Introduced to major smelters − Samples & technical exchange − Commercial & counter-party risk assessed − Confidence building -> MOU -> contracts
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 34
SALES PLAN & MARKET DEVELOPMENT − Primary strategy: ensure viable export markets − Several frame contracts / MOU’s were signed: • 2 - 5 year frame, annual negotiation of terms (incl. TC/RC, QP, payables, penalties, freight, payment terms, delivery schedule)
Production committed to Sales Agreements
2009
2010
2011
2012
0%
10%
20%
30%
40%
50%
60%
70%
80%
% of production
committed
balance
Prominent Hill sales 2009-10
− Commit 80-90% f’cast production, balance spot
Domestic, 15%
Europe, 15%
Asia, 70%
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 35
90%
100%
PROMINENT HILL CONCENTRATES: COMPETITIVE ADVANTAGES Exported copper concentrate grades – Chile Monthly average, copper concentrate grade, % Cu
Highest grade Cu –
CU levels globally declining
–
Lower freight/handling costs per unit/metal
–
Less slag per unit of metal
Low impurities (As, Bi, Hg, Zn/Pb) –
Helps smelters’ blending
–
Arsenic levels globally rising
–
Contained U&F manageable Source: CRU
Short transit time –
Two weeks to major custom smelters in Asia
–
Planning certainty for customers
Benefits to OZ Minerals • Higher payable Cu • Lower transport cost/unit metal • Cash-flow • Wide smelter acceptance
Traded concentrates, Cu content [% Cu] Australia Asia Australia South America Asia Australia Asia South America Asia Australia South America Australia South America Prominent Hill 0
10
Source: OZ Minerals
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 36
20
30
40
50
60
CUSTOM SMELTING INDUSTRY – OUR MARKET Global refined copper production by source (Ktpa) 2013 2012 2011 2010 2009 2008 -
5,000
10,000
15,000
Ktpa contained Cu Total EW
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 37
Primary
Secondary
20,000
25,000
CUSTOM SMELTING INDUSTRY – OUR MARKET 20,000
ktpa
15,000
55% 10,000
43%
5,000
19%
Mine production
Refining
Asia
Refined consumption
Total world
Asia: largest net importer of cathode and concentrate, basis 2009/10 OZ MINERALS • 30 NOVEMBER 2009 • PAGE 38
CUSTOM SMELTING INDUSTRY – OUR MARKET Year 2008: Major custom smelters, Asia. Actual concentrates demand [Millions tonnes pa]
Philippines, 0.65
Philippines, 0.5
India, 3.2
India, 2.1
China, 6
Sth Korea, 1.5
Year 2014: Major custom smelters, Asia. Forecast concentrates demand [Millions tonnes pa]
Sth Korea, 1.6
China, 12
Japan, 4.5
Total smelter production in Asia approx 6.6mt contained Cu Source: CRU 2009
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 39
Japan, 4.8
Total smelter production in Asia approx 9.6mt contained Cu
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
RUSSELL GRIFFIN GM Sales & Marketing
OZ MINERALS • NOVEMBER 2009 • PAGE 31
STRATEGY SUPERIOR TOTAL SHAREHOLDER RETURNS
ZERO HARM
FOCUS ON COPPER
MAXIMISE POTENTIAL OF ASSETS
BUILD A PROJECT PIPELINE
INVEST IN EXPLORATION
DISCIPLINED CAPITAL MANAGEMENT
FOUNDATION BUILT ON GOVERNANCE OZ MINERALS • 30 NOVEMBER 2009 • PAGE 32
SALES & MARKETING OF CONCENTRATES Responsible for: − Sales & logistics − Setting and implementing marketing plan, 3-5 years − Negotiating terms • frame, annual, spot − Match sales to production − Administering sales • 2 ships/mth & domestic sales − Shipping and freight
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 33
Port of Darwin
PROMINENT HILL CONCENTRATES SALES AND MARKETING Sales plan & feasibility study - years 2006-8 Metallurgical test-work determined likely product quality − Initial assay from laboratory ‘pilot’ using drill-core − Representative samples Introduced to major smelters − Samples & technical exchange − Commercial & counter-party risk assessed − Confidence building -> MOU -> contracts
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 34
SALES PLAN & MARKET DEVELOPMENT − Primary strategy: ensure viable export markets − Several frame contracts / MOU’s were signed: • 2 - 5 year frame, annual negotiation of terms (incl. TC/RC, QP, payables, penalties, freight, payment terms, delivery schedule)
Production committed to Sales Agreements
2009
2010
2011
2012
0%
10%
20%
30%
40%
50%
60%
70%
80%
% of production
committed
balance
Prominent Hill sales 2009-10
− Commit 80-90% f’cast production, balance spot
Domestic, 15%
Europe, 15%
Asia, 70%
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 35
90%
100%
PROMINENT HILL CONCENTRATES: COMPETITIVE ADVANTAGES Exported copper concentrate grades – Chile Monthly average, copper concentrate grade, % Cu
Highest grade Cu –
CU levels globally declining
–
Lower freight/handling costs per unit/metal
–
Less slag per unit of metal
Low impurities (As, Bi, Hg, Zn/Pb) –
Helps smelters’ blending
–
Arsenic levels globally rising
–
Contained U&F manageable Source: CRU
Short transit time –
Two weeks to major custom smelters in Asia
–
Planning certainty for customers
Benefits to OZ Minerals • Higher payable Cu • Lower transport cost/unit metal • Cash-flow • Wide smelter acceptance
Traded concentrates, Cu content [% Cu] Australia Asia Australia South America Asia Australia Asia South America Asia Australia South America Australia South America Prominent Hill 0
10
Source: OZ Minerals
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 36
20
30
40
50
60
CUSTOM SMELTING INDUSTRY – OUR MARKET Global refined copper production by source (Ktpa) 2013 2012 2011 2010 2009 2008 -
5,000
10,000
15,000
Ktpa contained Cu Total EW
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 37
Primary
Secondary
20,000
25,000
CUSTOM SMELTING INDUSTRY – OUR MARKET 20,000
ktpa
15,000
55% 10,000
43%
5,000
19%
Mine production
Refining
Asia
Refined consumption
Total world
Asia: largest net importer of cathode and concentrate, basis 2009/10 OZ MINERALS • 30 NOVEMBER 2009 • PAGE 38
CUSTOM SMELTING INDUSTRY – OUR MARKET Year 2008: Major custom smelters, Asia. Actual concentrates demand [Millions tonnes pa]
Philippines, 0.65
Philippines, 0.5
India, 3.2
India, 2.1
China, 6
Sth Korea, 1.5
Year 2014: Major custom smelters, Asia. Forecast concentrates demand [Millions tonnes pa]
Sth Korea, 1.6
China, 12
Japan, 4.5
Total smelter production in Asia approx 6.6mt contained Cu Source: CRU 2009
OZ MINERALS • 30 NOVEMBER 2009 • PAGE 39
Japan, 4.8
Total smelter production in Asia approx 9.6mt contained Cu
