Clean Coal Day 2011 International Symposium

Securing a Stable Supply of Coal to Japan

Toru Furihata, Managing Executive Officer Sumitomo Corporation

September 6, 2011

Establishment Number of Offices Consolidated Subsidiaries Affiliated Companies Number of Employees (as of May 2010) Total Trading Transactions Profit attributable to owners of the parent Total Assets Equity attributable to owners of the parent (For the fiscal year ended March 31, 2011)

1

Corporate Profile

December 1919 Overseas 115 (in 65 countries）, Domestic 26 557 (Overseas 402, Domestic 155) 229 (Overseas 171, Domestic 58) 5,218 (72,030 on consolidated basis) 8,349 billion yen 200 billion yen 7,230 billion yen 1,286 billion yen

Sumitomo Corporation Head Office

Metal Products Business Unit

Infrastructure Business Unit

General Products & Real Estate Business Unit

New Industry Development & Cross- function Business Unit

Mineral Resources, Energy, Chemical

& Electronics Business Unit

Media, Network & Lifestyle Retail Business Unit

Transportation & Construction

Systems Business Unit

President and CEO Executive Officers

Board of Directors

General Meeting of Shareholders

Corporate Group

Board of Corporate Auditors

Corporate Auditor

2

Investment in Coal Resources (1)

Feasibility Study Stage Open Cut / Thermal 2015 Start of Production (Plan) 20 mil. tons p.a. (Plan)

Newlands /Collinsville

Hail Creek

Wandoan

Abbot Point

Oaky Creek

Rolleston

Location Name of Mine Production Capacity Coal Type Equity Sumitomo Equity Coal

Queensland, Australia

Hail Creek 8.0mil. tons Metallurgical 3.3% 0.3mil. tons

Newlands & Collinsville 13.8mil. tons Thermal/Metallurgical 10.0% 1.4mil. tons

Oaky Creek 8.0mil. tons Metallurgical 25.0% 2.0mil. tons

Rolleston 8.5mil. tons Thermal 12.5% 1.1mil. tons

New South Wales, Australia Baal Bone 2.0mil. tons Thermal 5.0% 0.1mil. tons

Total 40.3mil. tons 4.9mil. tons

In-operation assets

3

Investment in Coal Resources (2)

Operating Company Production Capacity Coal Type Partner

Deo Nai Coal Company, Vietnam 3.0 mil. tons Anthracite Vinacomin

Cao Son Coal Company, Vietnam 2.5 mil. tons Anthracite Vinacomin

Location Name of Mine Stage Coal Type Equity

Australia

Wandoan FS （Plan 20-30 mil. tons） Thermal 12.5%

Redrock Exploration ---------- 12.5%

Pentland Exploration ---------- 12.5%

Canada Mt.Duke Exploration Metallurgical 7.3%

Tavan Tolgoi Coal Project, Mongolia

Elga Coal Project, Russia

Project Finance: Bontang coal mine, Indonesia (US$50 mil., 1997)

Loan: Yakutugol coal mine (Russia) to increase Yakutugol’s production of metallurgical coal with support by JBIC (US$75 mil., 2004)

Operating Company

Project Assets

New Sources

Loan

(New sources in other areas are also being studied.)

4

Coal Trade

Chubu Coal Center Co., Ltd.

Chubu Coal Center Co., Ltd. Chubu Coal Center Co., Ltd. is a transit storage base for thermal coal from abroad and offers a variety of services such as unloading imported coal from large coal carriers to the storage yard and shipping stored coal by barge or truck to end users in the fields of electric power, cement, chemicals, textiles and paper manufacturing. Location : Yokkaichi city, Mie prefecture Total site area : 216,000 m2 Coal storage yard: 152,000 m2

Storage capacity : 1 mil. tons Established : 1981 Shareholders : Sumitomo Corporation 45% Japan Transcity Corporation 45% Isewan Warehouse Co., Ltd. 10% Transaction volume: about 3 mil. tons p.a.

・ Import and sale of coal to domestic users (steel mills & utilities) ・ Our affiliate company, Bussan Sumisho Carbon Energy Co., Ltd., supplies coal to general industry users in Japan. ・ Japanese steel mills have appointed Sumitomo Corp. as one of the “coordinating” trading firms for their imports of Russian and Chinese metallurgical coal.

Trading

Coal Center

5

World Coal Production and Trade (1)

2000 2010

IEA Coal Information 2011

China 1.23

(27%)

US 0.97

(21%)

India 0.34 (7%)

Australia 0.31 (7%)

S.Africa 0.22 (5%)

Russia 0.24 (5%)

Germany0.21 (5%)

Poland 0.16

Kazakhstan 0.08

Indonesia0.08

Others 0.69

Coal Production 4.52 bil. tons

(2000）

China 3.16

(44%)

US 1.00

(14%)

India 0.57 (8%)

Australia 0.42 (6%)

Indonesia 0.34 (5%)

Russia 0.32 (4%)

S.Africa 0.25 (4%)

Germany 0.18 (3%)

Others 0.98

Coal Production 7.23 bil. tons

(2010） (estimate)

・China and India have increased their domestic coal production to meet domestic consumption. ・Australia, Indonesia and Russia have increased their coal production to meet increased export volumes.

Coal Production (incl. lignite) (in billion tons)

6

World Coal Production and Trade (2)

Australia 298 (27%)

Indonesia 287

(26%) Russia

109 (10%)

Columbia 68

(6%)

S.Africa 70

(6%)

US 74 (7%)

China 20 (2%)

Others 157

Australia 187

(30%)

S.Africa 70

(11%) Indonesia

57 (9%)

China 55

(9%)

US 53 (8%)

Russia 38

(6%)

Columbia 35

(6%)

Others 129

2000 2010

IEA Coal Information 2011

Coal Export 625 mil. tons

(2000）

Coal Export 1,083 mil. tons

(2010） (estimate)

・Australia, Indonesia and Russia have increased their export volumes. ・China has decreased its export volume due to increased domestic demand for coal.

Coal Export (incl. lignite) (in million tons)

7

World Coal Production and Trade (3)

Japan 150

(24%)

Korea 65

(10%)

Chinese Taipei 45

(7%) Germany 30 (5%) Russia

26 (4%) UK 23 (4%)

India 21 (3%)

France19 (3%)

US 11 (2%)

China 2

Others 234

Coal Import 627 mil. tons

(2000）

Japan 187

(18%)

China 177

(17%)

Korea 119 (11%)

India 90 (8%)

Chinese Taipei 70

(7%)

Germany 46 (5%)

UK 27 (3%)

Russia 20 (2%)

US 18 (2%)

France 18 (2%)

Others 294

Coal Import 1,063 mil. tons

(2010） (estimate)

2000 2010

IEA Coal Information 2011

・China and India have increased import volumes due to increased domestic demand for coal. ・Korea and Taiwan have increased import volumes.

Coal Import (incl. lignite) (in million tons)

Australia 87

(60%)

China 17

(12%)

Indonesia 14

(10%)

Canada 13

(9%)

Russia 5

(4%)

US 4

(3%) S.Africa 2 (1%)

Vietnam 1 (1%)

Others 2

Japan Coal Import 145 mil. ton (2000）

Australia 117

(64%) Indonesia 34

(18%)

Russia 11

(6%)

Canada 11

(6%)

China 6

(3%)

US 3

(2%)

Vietnam 2

(1%)

Others 1

Japan Coal Import 185 mil. ton (2010）

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World Coal Production and Trade (4)

2000 2010

Trade Statistics, Ministry of Finance, Japan

・The import quantity from China has decreased. ・The import quantity from Indonesia and its share have increased. ・In 2010, the import shares of Australia, Indonesia and Russia combined reached 88%.

Japanese Coal Imports by Country of Origin (in million tons)

9

World Coal Production and Trade (5)

・ Increasing demand in China and India has caused import quantities to increase greatly in both countries. ・ The quantity imported by other Southeast Asian countries has increased. ・ Australia, Indonesia and Russia have increased their exports to satisfy the increased demand in Asia.

Development of coal mines in emerging supply countries

Expanding coal supply capacity in existing supply countries

・The bottleneck to supplies in existing supply countries is rail and port infrastructure, which has reached operating capacity. ・Demand for importing thermal coal is expected to continuously increase as China, India and other Southeast Asian countries plan to build additional coal-fired power stations. ・Limited sources of metallurgical coal

2000-2010 Coal Trading Market Current Challenges

For the purpose of a Securing Stable Supply of Coal

10

Emerging Coal Suppliers (1) - Mongolia

Central Mountain Gobi West East Total

Number of mines 13 13 20 23 16 85

Resources (mil. tons) 26,528 7,704 49,785 27,158 51,165 162,340

Share 16% 5% 31% 17% 32% 100%

Mongolian Coal Resource Map

Mineral Resources Authority of Mongolia

Gobi

East West

Mountain

Central

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Emerging Coal Suppliers (1) - Mongolia

Tavan Tolgoi Coal Mines include West-Tsankhi, East-Tsankhi, UHG, etc. and are one of the largest and best metallurgical coal mines in the world. Reserves About 6 bil. tons (incl. 1.9 bil. tons of metallurgical coal) Current Status January 2011 International tender in West-Tsankhi March 2011 6 groups including 2 groups attended by Japanese companies were shortlisted. The Mongolian government and each group are holding negotiations.

China

Overseas Market

(Incl. Japan)

Tavan Tolgoi Coal Mine

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Emerging Coal Suppliers (2) - Mozambique Mozambique Coal （Zambeze Coal Field）

Project Developers Resources (mil. tons)

Planned Production (mil. tons)

Development Plan

1 Ncondezi 181 10 2012 Bankable FS

２ Chirodzi Jindal 724 10 2012 Production (plan)

３ Revuboe Talbot

Nippon Steel POSCO

1,067 4.2 (metallurgical) 0.8 (thermal）

2013 Export

４ Moatize Vale 954 17 (metallurgical) 5 (thermal）

2011 1.5 mil. tons Production (plan) 2014 22 mil. tons (plan)

５ Minas

Moatize Beacon Hill Resources 80 0.9 (metallurgical)

1.4 (thermal） 2012 Production (plan)

６ Benga Riversdale (Rio Tinto) Tata 4,000 1.7 (metallurgical)

0.3 (thermal） 2011 Production (plan) Future 20 mil. tons/y (plan)

７ Zambeze Riversdale (Rio Tinto) 9,000 10 (metallurgical) 5 (thermal） 2014 Production (plan)

８ Tete East Riversdale (Rio Tinto) 5,000 10

９ Tete West Mozambi Coal, etc. 3,100

10 Muturara Mozambi Coal, etc.

Beira Port

Nacala Port

１

２

３

４ ５ ６

７

８ ９

10

Production of metallurgical coal in this area is expected to start soon. The challenge is to upgrade ports and transportation infrastructure.

13

Existing Suppliers (1) - Russia

・ Developer ： Mechel （Russian steel producer : about 5 mil. tons of crude steel p.a.） ・ Reserves ： 2.2 bil. tons (metallurgical coal 0.6 bil. tons, thermal coal 1.6 bil. tons) ・ Production Plan ： 27 mil. tons p.a. (peak production of clean coal） A small amount of coal production will start when the construction of a railway is completed at the end of 2011. ・ Schedule： 2011～ 1 mil. tons p.a. for domestic (construction of rail, washing plant and power plant) 2013～ 9 mil. tons p.a., starting export (construction of new coal terminal at Vanino) 2016～ 18 mil. tons p.a. 2018～ 27 mil. tons p.a.

BAM Railway

Elga

Vanino Port

Posyet port

Neryungri

Elga Coal Project

The key issue is upgrading the rail and port infrastructure in order to ship Far East coal to Asian markets. Issues of railways ・ Chronic restrictions on rail transportation due to repair work ・ Rail becoming less available for transportation of coal due to increased export to China ・ Difficulty in incremental increase of transportation capacity due to non-electrification (BAM Railway) ・ Concern about influence of commencement of oil transportation from East Siberia to Vostochny port (Siberian Railway) ・ Shortage of freight cars ・ Problems in quality management Contaminated coal, coal dust, frozen coal (There are only two ports which have unfreezing facilities) Ownership of ports ・ All ports are privatized and owned by Russian coal producers. Port owners tend to prioritize exporting their own coal.

14

Existing Suppliers (1) - Russia

Rails / Ports in Far East

Vanino Port 1 mil. tons p.a.

Muchka Port 8 mil. tons p.a.

Maly Port 2 mil. tons p.a.

Nakhodka Port 3 mil. tons p.a.

Vladivostok Port 1 mil. tons p.a.

Posyet Port 3 mil. tons p.a.

Vostochny Port 15 mil. tons p.a.

South Yakuts

Tugnui

Total Capacity 33 mil. tons p.a.

WICET Project / Gladstone Port Expansion Plan (Wiggins Island Coal Export Terminal) Main Stockholders: Xstrata, Wesfarmers, Felix, and other Australian coal producers Expansion Plan: Stage 1: 30 mil. ton/y (2015) Stage 2: 60 mil. ton/y Stage 3: 80 mil. ton/y

15

Existing Suppliers (2) - Australia

Wandoan Project

Rail Construction (planned) about 200 km

WICET Project

New development of Wandoan, thermal coal project Developers ： Xstrata, Sumitomo Corp., Itochu Corporation Reserves ： 1.0 bil. tons（thermal coal） Production ： 22 mil. ton/y (plan) Schedule ： 2015 production start （7 mil. ton/y） Infrastructure ： 200 km railway

Rolleston

Expansion of Rolleston coal mine ・Rolleston coal mine plans to expand its thermal coal production from 9.5 to 13.5 mil. tons p.a. in 2014. ・Coal reserves in Rolleston coal mine are expected to increase from current 170 mil. tons to 210 mil. tons.

16

Securing a Stable Supply of Coal

Securing well-balanced supply sources ・By supporting the development of new coal mines in emerging supply countries and development to increase production in existing supply countries, we will secure those sources and achieve a good balance of supply and diversification of risks. Support for infrastructure development ・The keys are infrastructure development in emerging supply countries and in existing supply countries. ・Support for funding and EPC (Engineering, Procurement and Construction), etc. for infrastructure development is important. ・Government support programs, low-interest loans, funding support, etc. for infrastructure and coal mine development are expected. Clean coal technologies ・Coal usage with lower environmental burden by using clean coal technologies, such as reducing GHG by introducing high-efficiency coal-fired power generation, will be promoted. ・ Effective use of unused resources by coal upgrading, coal gasification, coal liquefaction, etc.