corporate presentation – maio 2009
TRANSCRIPT
May 2009
MMX MMX
TheThe onlyonly oneone ofof itsits kindkind
Disclaimer
This presentation relating to MMX Mineração e Metálicos S.A. (“MMX”) includes “forward-looking statements”, as that term is defined in the Private Securities Litigation Reform Act of 1995, in Section 27A of the Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. All statements other than statements of historical facts are statements that could be deemed forward-looking statements and are often characterized by the use of words such as “projects”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, “may”, “will”, or “intends”, or by discussions or comments about our objectives, strategy, plans or intentions and results of operations. Forward-looking statements include projections regarding our operating capacity, operating expenditures, capital expenditures and start-up dates.
By their nature, these forward-looking statements involve numerous assumptions, uncertainties and opportunities, both general and specific. The risk exists that these statements may not be fulfilled or, even if they are fulfilled, the results or developments described in such statements may not be indicative of results or developments in future periods. We caution participants of this presentation not to place undue reliance on these forward-looking statements as a number of factors could cause future results to differ materially from these statements.
Forward-looking statements may be influenced in particular by factors such as the ability to obtain all required regulatory approvals on a timely basis or at all, exploration for mineral resources and reserves, difficulty in converting geological resources into mineral reserves, and changes in economic, political and regulatory conditions. We caution that the foregoing list is not exhaustive. When relying on forward-looking statements to make decisions, investors should carefully consider these factors as well as other uncertainties and events.
MMX does not undertake to update our forward-looking statements unless required by law. This presentation is neither an offer to sell (which can only be made pursuant to definitive offering documents) nor a solicitation of an offer to buy any securities in the United States, or any other jurisdiction. The securities referred to herein have not been registered in any jurisdiction, and in particular, will not be registered under the U.S. Securities Act of 1933, as amended, or any applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.
This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without MMX’s prior written consent.
Investor Relations
Chequer Bou-Habib - IRO
Priscylla Setimi - IR
Tel. 55 21 2555-5558 / 5234
An EBX Group Company
EBX´s publicly held companies
All companies are listed in BOVESPA´s Novo Mercado Corporate Governance segment, consolidating a
market capitalization of close to US$ 17,9 Bi*.
Core Business: Logistics
Market Cap:
US$ 1,1 Bi*
Controlling Shareholder:
58%
Core Business: Power Generation
Market Cap: US$ 989 M*
Controlling Shareholder:
76%
Core Business: Oil & Gas
Market Cap: US$ 14,7 Bi*
Controlling Shareholder:
61%
Core Business: Mining
Market Cap:
US$ 1,0 Bi*
Controlling Shareholder:
65%
*Source: Broadcast as of May, 12th 2009; BRL 2,0649/USD (BACEN)
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A unique story
MMX Sudeste
6
The only one of its kind
MMX uniqueness:
� high quality iron ore;
� low cash cost, due to the high in situ ore content and
high productivity;
�secured logistics, through long-term agreements with
rail, barges and port services providers, including LLX Sudeste
Port, its sister company;
� the unique independent operating Brazilian
junior mining company;
� experienced Management in selecting high value
mining assets, implementing and operating mining projects;
� proven ability in delivering value to
shareholders.
MMX S.A. is the exclusive vehicle of EBX Group for investments in mining and metals, focusing on the production capacity increase through organic growth and the development of new opportunities.
Corumbá
SystemSudeste
System
MMX de
Chile
Since IPO (July’06), a lot has been delivered…
� Implementation of MMX Amapá System - mine, railroad and port - in 14-month record
time;
� implementation of MMX Corumbá iron ore mine in 8 months;
� implementation of MMX Corumbá pig iron furnaces in 12 months;
� basic engineering studies of MMX Minas-Rio;
� development of strategic partnerships with Anglo American and Cleveland Cliffs;
� close of long-term off-take agreements with traditional steel makers in Brazil and
seaborne market;
� business restructuring : split-up of LLX and sale of assets – MMX Minas-Rio and MMX
Amapá - to Anglo American;
�development of MMX Sudeste System: assets acquisition, development of secured
logistics and expansion plans;
� going abroad: Minera MMX de Chile and the good perspectives of iron ore in Chile.
Jul2006
Nov2008
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MMX structure
MMX Sudeste
100%
Minera MMX
de Chile
30% Centennial Asset Corumbá
Corumbá System
100%70%
MMX Corumbá
Mineração
MMX Corumbá
Mineração
MMX Metálicos
Corumbá
MMX Metálicos
Corumbá
Greenfield projects developed or under development by MMX: Corumbá System started-up in 2005 (Mining) and 2007 (Metallics); Bom Sucesso under basic
engineering studies
Assets acquired by MMX (AVG: dec-07; Minerminas: jan-08)
100%
100%
Sudeste SystemBom Sucesso
AVGAVG MinerminasMinerminasBom SucessoBom Sucesso
100%
MMX SudesteMMX Sudeste
100%
Free Float
34.71%
Controlling Shareholders
65.29%
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Serra Azul & Bom Sucesso
Sudeste System
10
Located at Iron Ore Quadrangle, MMX Sudeste System has an unique
combination of high grade iron ore, low cost and secured logistics.
BOM SUCESSO TENEMENT
LLX SUDESTE PORT
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�� Assets acquisitionsAssets acquisitions concluded on Janconcluded on Jan’’08; 08;
�� Construction of Magnetic Concentration Plant and a Construction of Magnetic Concentration Plant and a
series of operational enhancements led Serra series of operational enhancements led Serra AzulAzul site to site to
reach reach 8.7 8.7 MtpyMtpy as annual installed production as annual installed production
capacitycapacity in Nov, 2008;in Nov, 2008;
Serra Azul site: 8.7 Mtpy of capacity reached on Oct’08
�� Rail capacityRail capacity secured through longsecured through long--term agreement term agreement
with MRS up to 15 with MRS up to 15 MtpyMtpy;;
�� Port capacityPort capacity secured with CSN Terminal de secured with CSN Terminal de CargaCarga
de de ItaguaItaguaíí Port: 2 million Port: 2 million tonnestonnes annually, from 2009 to annually, from 2009 to
2011;2011;
�� Port capacityPort capacity from midfrom mid--2011 till 2032 secured 2011 till 2032 secured
through longthrough long--term agreement with LLX term agreement with LLX SudesteSudeste Port;Port;
�� LongLong--term Offterm Off--take agreementstake agreements with domestic with domestic
miners and steel makers;miners and steel makers;
�� Developing longDeveloping long--term relationship with foreign steel term relationship with foreign steel
makers through makers through trial shipments, trial shipments, aiming at becoming a aiming at becoming a
consistentconsistent international supplierinternational supplier..
Operations Sales & Logistics
Concentration Magnetic Plant – Start-up Oct 30’08
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Bom Sucesso site: outstanding magnetite content and logistics
View from the west hillside of the Bom Sucesso mountain ridge
�� Acquisition of mining rights concluded on JulyAcquisition of mining rights concluded on July’’08;08;
�� Unique Unique magnetite contentmagnetite content (30%)(30%);;
�� The The closest iron ore asset to the shore closest iron ore asset to the shore –– 240km 240km
(lower rail tariff);(lower rail tariff);
�� Greenfield basic engineering studies and environmental Greenfield basic engineering studies and environmental
licensing under development;licensing under development;
�� Rail capacity under negotiation with MRS to extend current Rail capacity under negotiation with MRS to extend current
contract for additional 17 contract for additional 17 mtmt up to 2032.up to 2032.
Expected Quality:
Fe: 67.2%
SiO2: 2.5%
AL2O3: 0.5%
P: 0.033%
PPC: 0.6%
FeO: 8.8%
Tests
MMX Sudeste: aggressive expansion plan to become an international player
Total Capex*
US$ 1,026 MM
Production Capacity
2009 to 2013 Expansion plan built up in 3 phases:
Phase I: the installed annual capacity to
reach 8.7 Mtpy was achieve in Oct’08 upon
the start-up of the Magnetic Concentration
Plant;
Phase II: Serra Azul brownfield expansion up
to 16.3 Mtpy – approx Capex US$360MM
Current under detailed engineering and licensing
studies
Phase III: Bom Sucesso greenfield project,
adding 17.4 Mtpy of high magnetite iron ore –
approx Capex US$640MM
Current under basic engineering studies
13*Capex and timeline to be confirmed upon conclusion of detailed engineering studies and analysis of market conditions; average exchange rate R$2.12
PHASE I
CONCLUDED
23
146 13073
11
105
362
168
-
31
251
492
241
11
2008 2009 2010 2011 2012
3.48.7 8.7
18.514.7 16.3
17.417.4
3.4
8.7 8.7
18.5
32.133.7
2008 2009 2010 2011 2012 2013
Bom Sucesso
Serra Azul
PHASE I PHASE II PHASE III
LLX Sudeste Port: dedicated to iron ore
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� The preliminary environmental
license (“Environmental License”)
is already approved;
� “Port Sudeste” considered
eligible by BNDES for long term
financing;
� Capacity to handle 50 million
ton/year of iron ore. It will serve
MMX Sudeste System and other
producers from Minas Gerais' Iron
Ore Quadrangle;
� Start-up: second half 2011.
Chile
Preliminary tests in Ouro Preto pilot plant:
-Fe: 67,50%
- SiO2: 2,5%
- Al2O3: 0,85%
- P: 0,015%
Iron Ore in Chile: quality & logistics
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Patrícia
Bella
Fortuna-
Fierro
Teatino
s
50km distant from the Chilean coast
approx 1,760 hectares
Pellet feed with high magnetite content
Existing railroad (FERRONOR)
4 mining rights (2 purchase and options
agreements)
USD 44,5 million
EBX has 240,000 ha property at Atacama region
Permits to develop the urban, industrial and port
zones
Water availability with permits
Guaranteed site contract for:
89 ha of premium area (port)
782 ha of retro-area
Unlimited scalability for a long-term
development
Located close to mining players
Opportunities for industrial businesses:
Port / Thermo
Puerto
Punta Cachos
Logistics: Puerto Punta Cachos
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Corumbá System
MMX Corumbá Mineração
Development in 2008:Development in 2008:
� conclusion of NE&Rabicho mineral rights acquisition;
� implementation of new mine route, reducing transportation
inside the mine from 12.5km to 2.5km (costs and time
savings);
� construction of tailings dam;
� implementation of water recovering system;
� implementation of industrial jigging test;
� new mining rights under registration
Significant impact on costs:
expected reduction of 35%
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Corumbá iron ore mine resumed its operations on
May 05, 2009.
Corumbá lump ore
Production Capacity*
2009 to 2013
*Capex and timeline to be confirmed upon conclusion of detailed engineering studies and analysis of market conditions
1.62.1
3.2 3.2 3.2
3.1
1.62.1
3.2 3.2
6.3
2008 2009 2010 2011 2012
NE & Rabicho Mine
63 Mine
PHASE I PHASE II PHASE III
MMX Corumbá: Sales & Logistics
Sales
Logistics
� Transport is made in barges down the Paraguay River
delivering products to South American customers and to
Rosario Port, where cargo is shipped to Europe.
� MMX has long-term contracts with local and international
barge operators;
� Rosario Port in Argentina: Handymax vessels
� MMX has Long Term Supply Agreements – 5 years, in
average - with traditional steel makers in South America
and Europe.
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Ladário Port
MMX Metálicos Corumbá: Pig Iron plant
Pig Iron:Pig Iron:
� 2 blast furnaces already with total installed capacity (400 MTPY);
� forestry program in maintenance: planted area of 6 thousand hectares.
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MMX announced, on May 04, 2009, that the operation of
the Pig Iron Unit will be kept suspended and the
production will be resumed according to the recovery of
the steel industry, in Brazil and worldwide.
The activities of the forestry unit will remain suspended
and the necessary maintenance activities of the planted
area will be maintained.
