Katowice, 06.09.2019

MINING AS A NECESSARY INDUSTRYFOR POLAND, EUROPE AND THE WORLD

10 facts in 10 minutes of presentation

Paweł Bogacz, Dr. Hab. Eng. Coordinator of GÓRNICTWO OKFaculty of Mining and Geoengineering AGH University of Science and TechnologyFoundation for AGH

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Coal mining in Poland is a mature industry. This can be is determined by the depletion of a large part of the reserves. Current balance resources enable a consistent, viable and responsible production atthe level of tens millions tones of coal throughout the period of the following 60-80 years.

Fact No. 1

Some facts regarding the mining industy

1990 2018

Productionscale[mln Mg](relative to worldproduction [%])

150(6,5)

63,5(1,2)

Average miningdepth[m] 589 752

Average unit costod production[zł/Mg] 198 296

Average salary in mining in relations to the nationalaverage

1,89 1,16

Source: Own study

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A few facts about the mining industry,

i.e. the context

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In 2019, it will take humanity only 210 days to reach the limit of nature's ability to recover its resources (this year's Earth Overshoot Daytook place on 29.07). We are therefore consuming more and more natural resources at a faster and faster rate. Currently, we need resourcesof at least 1,75 of the maximum supply that Earthcan provide to meet the needs of humanity.

Fact No. 2

Source: overshootday.org, 26.06.2019

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Some economical facts regarding the mining industy

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Increasing global demand for mining products

Source: International Energy Agency, 2016Barchański, 2017 Euracoal, 2019Diercks, 2019

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Some economical facts regarding the mining industy

Fact No. 3

7Source: Ahlborn, 2017eia.gov, 2015Polish Geological Institute, 2014Tauron, 2019

An example:Using of hydrogen, methane, syngasfrom coal

Replacement of lignite in Germany with wind energy:

80000 windmills!

One wind turbine every 2100 metres

A train for the gravel, cement and steel would be 70000 kilometers long.

Increasing global demand for mining products

Fact No. 3

Some economical facts regarding the mining industy

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The mining and quarrying industry generated 5.3% of Poland's GDP in 2018

Mining is on the fourth place in the aspect of the GDP-building industries in Poland

Fact No. 4

Some economical facts regarding the mining industy

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Source: ICMM, 2018

Poland with biggest level of index MCI (mining contribution index) in EU. 33% of income of the Polish mining companies is handed over to the central and local budgets, which is absolutely the highestscore in the enitre economy of Poland. Four mining boroughsamong the eight richest Polish boroughs in the year 2017.

Fact No. 5

Some economical facts regarding the mining industy

No. Borough G indicatorin 2018

1 Kleszczów 31962,75

2 Rząśnia 8634,17

3 Kobierzyce 5808,52

4 Mielnik 5793,09

5 Jerzmanowa

5753,53

6 Rewal 5741,33

7 Polkowice 5593,17

8 Nadarzyn 5508,24

Source: Report of samorzad.pap.pl, November 2017

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Source: KPMG, 2016

Mining is among the industries with the highest generation of added value, despite it being heavily dependent on economical cycles.

Fact No. 6

Some economical facts regarding the mining industy

ENERGETICS FOOD PRODUCTION MINING PRODUCTION OF METAL AUTOMOTIVE PRODUCTS

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Fact No. 7

Some social facts regarding the mining industry

In 2018, there were 132 thousand people working in the Polishmining industry (82,5 thousand in coal mines), and it’s estimated thatan another 540 thousand is employed in the provisioningenterprises. Source: Statistics Poland, 2019

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Fact No. 8

Some social facts regarding the mining industry

The earnings of miners are the highest among the Polish industries (about 3000 EUR/month), which marks a high economical and social status of this industry's representatives.

Source: Statistics Poland, 2019money.pl, 2019, interia.pl, 2019

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The level of emissions from the combustion of natural gas isnotably higher than that of coal.

Fact No. 9

Some enviromental facts regarding the mining industry

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Source: Barchański, 2017Fichtner, Rheinbraun, 2017

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Some enviromental facts regarding the mining industry

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Emissivity and demand for raw materials in the case of electric cars is higher than for vehicles with internal combustion engines.

Fact No. 10

Source: Berylls Strategy Advisors, Bloomberg, 2018Battery Electric Vehicles, 2018

Material shortages will primarily affect cobalt - global resources allow for the production of 300 million cars, which will allow electrification of up to 25%. from 1.2 billion of all currently driving on the roads

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Instead of summary

1. The changes in Upper Silesia, soon in the whole Poland, relatedto the continuous depletion of coal ores are unavoidable.

2. However, they mustn't be done in the revolutionary way, butrather evolutionary - through the following years, using the ways ofsocial responsibility and sustainable development.

3. These ways are pointed by the economical, social and ecologicalfacts.

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SINCERELY THANK YOU FOR YOUR ATTENTION!

Paweł Bogacz, Dr. Hab. Eng. Coordinator of GÓRNICTWO OKFaculty of Mining and Geoengineering AGH University of Science and TechnologyFoundation for AGHbogacz@agh.edu.pl(12) 617 21 27; 606212820;