Investor Visit HZL Mar09

7/30/2019 Investor Visit HZL Mar09

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ENDURING

VALUE

THROUGH

VALUES

Akhilesh Joshi

Chief Operating Officer

HINDUSTAN ZINC LIMITED

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Largest Integrated Zinc - Lead Producer 2010

Competitor data from Brook Hunt

1064

kt Zn





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Solid Growth with Low Risk

2006 2007 2008 20102005 2012

ChanderiyaHydro I

170 ktpa

RampuraAgucha Mineexpansion

2.3 mtpa to3.75 mtpa

ChanderiyaCPP

2 x 77 MW

ChanderiyaAusmelt LeadSmelter

50 ktpa

ChanderiyaHydro II

170 ktpa

Rampura AguchaMine expansion

3.75 mtpa to 5mtpa

Chanderiya &Zawar CPPexpansion

2 x 80 MW

Gujarat & Karnataka WindPower Plant 124 MW

Chanderiya &Debari ZincDebottlenecking

88 ktpa

Dariba Smelter

Zinc 210 ktpaLead 100 ktpaSilver350 tpa

Dariba CPPexpansion

2 x 80 MW

RampuraAgucha Mineexpansion

5 mtpa to 6mtpa

SK Mine expansion

0.3 mtpa to 1.5mtpa

New Mine at Kayar0.3 mtpa

Delivered Under Implementation



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Key Highlights

HZL stands out with 29% EBITDA in Q3 09, even asmajor integrated producers like Xstrata, Teck, Bolidenetc. with negative EBITDA margins struggle to survive.

HZL continues to maintain zero inventory levels.

HZL continues to invest in its expansion projects(phase III project capexRs. 3,600 crores) asplanned.

Strong balance sheet with cash balance of over Rs.

9,300 crores and Nil gearing.

Last man standing philosophy





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World Class Mining Assets

Rajpura Dariba Mine

Lead-Zinc R&R:

Reserves 7.2 MtResources: 41.9 MtZinc Grade: 4.4%Lead Grade: 2.3%Ore Production Capac ity:1.2 mtpaCPP: 80 MW

Zawar Mining Complex

Rampura Agucha Mine

Lead-Zinc Ore R&R:Reserves: 63.6 MtResources: 43.8 MtZinc Grade: 13.9%Lead Grade: 2.0%Ore Production Capac ity:5.0 mtpa. Will increase to 6.0mtpa

Lead-Zinc Ore R&R:Reserves: 7.1 MtResources: 17.6 MtZinc Grade: 6.6%Lead Grade: 1.7%Ore Production Capac ity:0.60 mtpa. Will increase to0.9 mtpa

Sindesar Khurd Mine

Lead-Zinc Ore R&R:

Reserves: 1.96 MtResources: 35.2MtZinc Grade: 5.8%Lead Grade: 3.8%Silver Grade: 215 ppmOre Production Capac ity:0.3 mtpa. Will increase to 1.5mtpa

Note: Map not to scale

Kayar Mine

Resources: 9.01 Mt,Avg: 10.6%, Zn,1.7% Pb0.3 mtpa Capacity

Kayar Mine





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World Class Smelting Assets

Pyrometallurgical Lead Zinc Smelter:105,000 tpa Zinc35,000 tpa Lead150 tpa SilverHydrometallurgical Zinc Smelter:420,000 tpa ZincAusmeltTM Lead Smelter:50,000 tpa Lead851,000 tpa Sulphuric AcidCaptive Power Plant: 234 MW

Vizag Zinc Smelter

Hydrometallurgical Zinc Smelter:88,000 tpa Zinc419,000 tpa Sulphuric Ac idCaptive Power Plant: 29 MW

Hydrometallurgical Zinc Smelter:56,000 tpa Zinc91,000 tpa Sulphuric Ac id

Dariba Complex Phase III

Hydrometallurgical Zinc Smelter:210,000 tpa ZincLead Smelter100,000 tpa LeadSilver Refinery350 tpa SilverCaptive Power Plant: 160MW

Note: Map not to scale

Dariba Smelting Complex is under implementation

Chanderiya Smelting Complex Debari Zinc Smelter





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Highlights

Note: COP w/o royalty





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1%

3%

3%

PROMISING FUTURE

Global consumption is growing @ 34% CAGR, world needs ~0.5 Mt more zinc every year

Indian consumption at ~ 0.47 Mt in FY 08 is robust & expec ted to grow at double digits and

also likely to double in 5-6 years at the back of strong 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

Robust Zinc Demand

Per capita zinc consumption in 2007 (kg/capita)

Note: Indian per capita zinc consumption in 2008 was 0.43 kg/capita

Ref: Brook Hunt 2008 Q4





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Asia (Excl China)

Latin America

Western Europe

Africa Oceania

North America

Asia accounts for close to 50% of Global Zinc demand

SAARC Nations are freight Friendly

Asian Zinc market is in deficit

Global Production : 11,753

Global Consumption : 11,371

Surplus : 382

Note:All figures in thousand tonnes

Ref: Brook Hunt 2008 Q4

Global Market : 2009




Cli k H & U d


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Overall R & R increased by 115 million tonnes , pre-depletion of 26.3 million tonnes.

HZL R&R - Three pronged approach

In mine exploration Near mine exploration Greenfield exploration (area applied in Indiazinc rich belt)

Focus on Developing Resources

143.7

232.3

209.4177.6

164.8146.3






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Total R&R as on 31 March 2008 is 232.3 million tonnes containing 27.5 million

tonnes of zinc-lead metal

Rampura Agucha mine achieves landmark of crossing 100 million tonnes

(actual: 107.3 million tonnes) containing

Increase in R&R by 28.7 million tonnes containing 4.0 million tonnes of

metal, prior to depletion

Increase in mine life to 24 years

Robust Reserves & Resources

Exploration Success in FY 2008

Sindesar Khurd Mine R&R increased from 13 million tonnes in 2005 to over 35 million tonnes in 2008

Ore body of SK mine is open in depth

Total R&R as on 31 March 2008 is 37.17 million tonnes containing 3.5 million

tonnes of zinc-lead metal & 257 Moz of contained silver metal.






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Silver A New Dimension

Highest primary silver producer in India (currently): 3.7 million ounce

per annum

Ramping the capacity to 16.1 million ounce per annum by 2012 in

phases

Major contribution from SKM and RAM expansions

High silver grade of Sindesar Khurd ore ~ 215 ppm

New silver refinery with a capacity of 350 tonnes per

annum (~11.3 million ounce per annum) to be

commissioned by 2010

Recovery of silver from zinc circuit (all hydro smelters)

Capture 2.5% of Global silver market post expansion






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Best Zinc People in the World

n Organization Structure enhancing performance

- Empowered SBU work culture

- Leadership development for succession planning

- Talent identification, positioning and rewards

- Performance oriented online appraisal.

n Competence Building

- Over 1,000 employees have undergone specially

designed general management & technical

training programme.

- To attract best talent at induction level

Qualification of fresh joineesFirst Class Graduate

- Ac c e le ra ted d eve lopm ent o f exec u t ives th roug h

sp ec ia lized p rog rammes at rep uted inst itut ion s -IIM / IIT / ISM / BITS

- Exposure to other world-c lass operations

n Cutting edge combination of experienced and

young engineers in expertise & energy levels

n Tremendous focus on quality of life

FRESHERS HIRING (2002-2008)






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Robust safety policy, prac tices 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.

External HSE audits are being done by agencies of international repute PwC, E&Y, B.S.C

Proactive actions like analysis of near miss incidences, periodical independent reviews,

regular training etc.

Equal focus on contract workmens safety

Compulsory use of Persona l Protective Equipment (PPE) including by contract workmen.

No cases of occupational health diseases

Nearly 50% reduction in LTIFR every year

Focus on Safety

*Lost Time Injury Frequency Rate






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Mid Day Meal - More than 200,000 primary school going children are being benefited

through 6 Hi- Tech Kitchens established by HZL

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

covering more than 40,000 children's Covering 173 villages and among them transforming 59 poverty strickenvillages into model

one based on socio-economic indicators

32 model villageshave been completed and audited by ORG, New Delhi (>75% success)

Post Graduate Girls College in Ringus serving around 900 students coming from rural area

Corporate Social Responsibility - Snapshot

Impacting over 500,000 lives, covering173 villages






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n Process Excellence Award By International Quality & Productivity Centre, London in

2008n FICCIAnnual Awards 2007-08 in the category ofRural & C ommunity Development

n Ramkrishna Bajaj National Quality Certificate of Merit ( RBNQ 2008)

n Golden Peacock Award for Excellence inCorporate Governance-2007by the Instituteof Direc tors

n Asian Corporate Soc ial Responsibility Award 2007-08

n Dun & Bradstreet- American Express Corporate Award 2007 for Top Indian Company inthe Non-Ferrous Metals Sec tor.

n Pegasus Gold Corporate Social Responsibility Award 2008

n TERICorporate Soc ial Responsibility Award 2007 by Honble Finance Minister of India.

n Asian Power Plant of the Year 2007 and also Best Emission Reduction Project in Asia toChanderiya Captive Power Plant by Asian Power, Singapore

n FICCI-SEDFCorporate Soc ial Responsibility Commendation Certificate 2006 by HonblePresident of India.

n FIMICorporate Soc ial Responsibility Award 2007

n FIMIExcellence Award for the year 2007-08 to Rampura Agucha Mine.

n Golden Peacock National Training Award 2006.

n Golden Peacock Corporate Soc ial Responsibility Award 2007

Awards & RecognitionDocumentsPDFComplete

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Rampura Agucha Mine


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Rampura Agucha Mine

A world class zinc asset

Largest zinc mine in the world

One of the lowest cost zinc mine

Modern efficient mining operations

Exploration Emphasis on exploration has been intensified in thelight of aggressive growth plan

Crossed the landmark of 100 million tonnes of R&R

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Mine Parameters

Mine pit dimension : 1650 m x 680 m Bench height : 10 m in Ore ; 10 m in Waste Berm width and bench angle : 6.5 m

: Individual bench angle 70at F/W & 80 at H/W Ultimate pit wall slopes

H/W : 42F/W : 36

Pit access : Ramp one each in H/W & F/W,: width 25 m , gradient 1 in 12.

Ultimate depth of pit : 440 meters from surface plan Waste Management : 4 X 10 m lift, with overall slope angle of 27


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Rampura Agucha Mine - An Overview

Commissioned : 1991

Location : 225 km north of Udaipur,

Rajasthan, India

Reserves : 63.6 million tonnes

(13.0% Zn, 2.0% Pb)

Resources : 43.8 million tonnes

(15.3% Zn, 2.0% Pb)

Ore Production : 5.00 mtpa and is being

enhanced to 6.00 mtpa

Certification : ISO 9001:2000, ISO

14001:2004, OHSAS

18001:1999, 5 S certified


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E d d F t


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Largest Zinc Mine

2008

Note: All figures are in Kt Zn

Competitor data from Brook Hunt

Rampura Agucha - Largest Zinc Mine in the world


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OMS & Ore Production

n Continuous improvement in efficiency leading to higher ore production.

* OMS Output per man per shift


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Rising trend of Lead Recovery %

Rising trend of Zinc Recovery %

Note: The year mentioned is in Fiscal

Metal Recovery

Zinc recovery :

Consistency in operation & ore feed

Regrinding of scavenger & cleaner concentrate

Capturing more liberated particles.

Capturing fine particles of concentrate

Circuit modification of scavenger

Continuous Mineralogical auditing

Lead recovery:

Fine primary grinding from 79 microns to 72 microns

Circuit modification

Introduction of automation in cleaner circuit

Introduction of double launder system

Continuous Mineralogical auditing to

identify mode of losses and controlling.


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Conservation of Energy & Water

Reduction in specific energy consumptionkwh/tonne of ore treatment

Reduction in specific water consumptionm3/tonne of ore treatment

Energy Reduction:

AC variable speed drives (25 nos.) Optimization of pumps speed.

Maintaining system power factor0.99

Optimization of grinding media size & charge

Energy savers in lighting circuits

Employee participation & six sigma methodolog

WaterReduction

Recoup from tailing dam

Zero discharge of water through recycling

Water reservoir of 50,000 m3 for storage to

reduce the evaporation.

Garland drains all around mine pit & waste

dumps.

Domestic sewage water after treatment in STP

isutilized for plantation.


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Dust Prevention

Wet drilling operations

Water sprinkling on HaulRoad

Dust Extraction systemsat crushers

Chemical treatmentof haul roads

Aforestationsaround the mine periphery

Systematic stacking of waste and vegetation overinac tive benches

Adopted recycling and reuse of Water forZero discharge.

Tailing dam with continuousmonitoring

Rock filled with lining

Designed by experts from Central Water Commission and Indian Institute

of Science, Bangalore.

LDPElined for seepage control

Focus on Environment - Mines

One of the best managed mine in the World


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Sindesar Khurd Mine

Rajpura Dariba Mine

Sindesar Khurd


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mRL

BH-1BH-4 BH-2 BH-3

Ramp

N

Sindesar Khurd Longitudnal Vertical SectionDepthS

InclineVent. raise

Longitudinal Vertical Section SK Mine

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


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Sindesar Khurd Mine

Drilling Total R&R(meters) million tonnes

FY 2005 710 13.50FY 2006 5,634 13.50FY 2007 18,174 13.62FY 2008 26,066 30.85FY 2009 14,300 37.17(till date) 64,884 37.17


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Chanderiya Smelting Complex

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Imperial Smelting Technology

Commissioned in 1991

105 KTPA Zinc,

35 KTPA Lead

Ausmelt Lead Smelter

Commissioned in 2006

Cansolv Technology Recovery +97%

50 KTPA Lead

Pyro Lead Zinc SmelterRLE Technology, Outotec

Commissioned in 2005 / 2007

2 x 210 KTPA Zinc,

Best & Proven Technology

Recovery +96%

Hydro I 100% EOU

Hydro Zinc SmelterBharat Heavy Electricals Ltd (BHEL)

Commissioned in 2005 / 2008

77 + 77 + 80 MW (234 MW)

Proven Technology

Operation outsourced to KoreaPower Services

Captive Power Plant

Worlds Largest Zinc Smelting Complex

Single Largest Zinc Smelting Complex in the World



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Operational Excellence

Reduced Sp. energy consumption to 17.11 GJ /t of metal

Reduced Sp. water consumption to 11.76 m3/t of metal

Increased byproduct recoveries ex: cd, cu, Ag, etc

Lead- Silver residue recovery in Hydro plant has been implemented

Six Sigma culture for problem solving, ex: silver refinery cycle time reduced to 20hrs

SpEnergyConsumptio

n(m3/tofmetal)

SpWaterConsumption

(GJ/tofmetal)

Sp Water Consumption m3/t of metalSp Energy Consumption GJ/t of metal


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Overall Zinc Recovery%

Cathode PowerConsumption KWH / MT Zinc

Key Value Drivers CLZS Hydro Smelters

World class zinc plants with latest andbest technologies

Benchmarking the efficiencies withthe global best smelters

Special teams focusing on such highimpact projects for improvements

Recording of leanings and theirimplementation

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Environmental Focus Smelters

Lowest SO2 emission

Latest technology (J arofix) - eliminates hazardous waste

generation

Zero discharge leading to reduced specific water consumption

Worlds largest and latest generation roasters

Extremely efficient waste heat energy recovery system coupled

with power generation


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THANK YOU
