Positive Impact
Tronox Fairbreeze Mine in South Africa
Jean-François Turgeon
Executive Vice President
TiO2 World Summit
Montreal, Quebec
8 October 2014
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
1
Tronox Limited At A Glance
• The largest fully integrated company in sector
• Leading global producer of:
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Titanium Dioxide (TiO2)
Titanium feedstock (CP Slag, SR, Rutile)
Zircon, pig iron, activated carbon
Specialty chemicals: sodium chlorate, boron
trichloride, electrolytic manganese dioxide
• Global footprint
• Mineral sands mines & processing in South Africa
and Australia
• TiO2 plants in USA, Australia, and the Netherlands
• Electrolytic plants in USA
• Corporate offices in Stamford, CT
• Pigment R&D Center in Oklahoma City
• 3,400 employees; 2,000 contractors
• $2.0 billion revenues; $3.5 billion market cap
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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One of the World’s Largest Ore Producers
Well-positioned in growth markets worldwide
Long-term supply from existing and new mines
Mineral Sands Production Facilities
Capacity (MT/YR)
Rutile
Namakwa
Sands
31,000
Titanium Slag
190,000
Zircon
135,000
Pig Iron
100,000
36,000
30,000
70,000
Total
97,000
220,000
220,000
410,000
60,000
265,000
121,000
221,000
26,000
Leucoxene
Exploration rights &
undeveloped reserves
KZN
Sands1
220,000
Synthetic Rutile
Reserve Life
of Mine
Northern
Ops
26,000
20+ Years
15+ Years
12+ Years
Yes
Yes
Yes
1. KZN data includes Fairbreeze mine development project expected to open in late-2015
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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Tronox KZN Sands
• Located in KwaZulu-Natal, east
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coast of South Africa
Hillendale Mine closed 2014
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Extensive rehabilitation program
underway
• New Fairbreeze Mine under
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construction
Hydraulic mining to mine slurry for
the primary wet plant
Heavy mineral concentrate from
wet plant is transported via road to
the Empangeni central processing
complex
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Mineral Separation Plant
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Dual electric-arc furnace smelters
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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The Road To Fairbreeze
This literally is the new road to Fairbreeze
• Site is 40km south of Richards Bay
• Titanium-rich ore body, with high-quality deposits of zircon and pig iron
• Capital Estimate: $365M over three years
• Full construction underway
• Production expected in late 2015; completion in mid-2016
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
5
Fairbreeze Local Benefits
• Job creation and retention
• ~1,000 new construction jobs
• Priority to hire from local
community
• High unemployment in area
• ~750 permanent jobs preserved
• ~300 permanent contractors jobs
• ~1,000 long-term indirect jobs
• More than $27.4 million annually in
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salaries and wages
Over $48.5 million per year in goods
and services from local businesses
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
6
Roadblocks to Development
Bureaucracy, legal appeals, and politics delayed launch by more than 2 years.
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Multiple permitting agencies, redundant
processes
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Lack of policy alignment among
municipal, provincial, and federal
authorities
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Several permitting appeals,
construction halts and stays
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Election-year politics compounded by
platinum and gold mining industry
labour unrest
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Vocal (but small) opposition group
presented numerous permitting
challenges and cascaded
misinformation
•
Little federal government support for a
more cohesive and streamlined
process slows economic development
of mining industry
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
7
Stakeholder Engagement
Open, proactive, and direct communications with the local community is critical
- No project of this scale can be successful without candid dialogue among all parties
Community Stakeholders:
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Macambini Tribal Authority
KwaNzuza Tribal Authority
Ogagwini Tribal Authority
Mkhwanazi Tribal Authority
KwaDube Tribal Authority
Somopho Tribal Authority
Mtunzini Ratepayers Association
Mtunzini Conservancy
Labor Unions
Governmental Bodies:
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Dept. of Mineral Resources
Dept. of Labour
Dept. of Water Affairs
Umlalazi & Mtunzini municipalities
Provincial & federal courts
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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Pipelines of Communications
• Frequent multi-lingual public meetings
• Open Q&A with all stakeholders
• Appropriate actions taken to accommodate local
concerns
• Broad sharing of construction and long-term
maps, plans, and timelines
• Site visits with community leaders, tribal and
government authorities, and media
• Proactive outreach and dialogue with opponents
• Monthly “FairTalk” magazine distributed widely
in region
• Local job fairs
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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Labor Relations
• July 2014 collective bargaining agreements with
the National Union of Mineworkers (NUM) and
Solidarity
• Strong culture and working relationship based on
trust and effective communication with unionrepresented employees
• Approximately 1,250 of Tronox’s 1,750 workers
in South Africa are covered by collective
bargaining agreements
.
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
10
Fairbreeze Paves Way for Future Development
Tronox – Eskom partnership powering Fairbreeze and Mtunzini
• Frequent power disruptions to the
Town of Mtunzini eliminated
• Aging infrastructure, poor
distribution, and insufficient
capacity upgraded
• Even with permitting delays,
Tronox moved forward to build the
new power line to Mtunzini
• Mtunzini now has adequate power
supply to support new
development, creating jobs and
economic growth
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
11
Local Economic Development (LED) Policy
The Social and Labour Plan
• The Social and Labour Plan is required by
the Department of Mineral Resources and is
a legislative requirement to obtain a mining
license. This has an impact on the LED
policy and planning of projects.
• Commitments regarding LED projects are
made over a five-year period, and a budget
is allocated to be approved by this
department. This plan requires alignment
with government guidelines and District
Municipality Integrated Development Plans.
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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Examples of Tronox LED Investments
• Ogagwini Skills Centre and implementation of the
first skills training programmes
• Mkhwanazi Multipurpose Centre, including
community hall where meetings, functions and
church services can take place
• 18 rural high schools receiving mobile science
equipment
• Solar Power project for 498 rural households in
Macambini Traditional Authority
• Twinstreams environmental educational programme
for 14 primary and high schools
Computer skills training centre at
Nzuza and Internet Café were put in
operation with a focus on computer
training.
• 61 new houses in the Dube Traditional area,
Madlankala and Gobandlovu wards
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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New Housing for Mine Communities
• Modern, safe, and sanitary housing
is lacking in rural KwaZulu-Natal
• Tronox is building new houses for
families in the area
• Three-year initiative began in 2013.
• Phase 1 addressed households
with greatest need
• A local company, Khopela
Construction, won contract to build
61 new houses during 2013/2014.
• Owners can select different house
types.
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
14
Land Rehabilitation
• Mined land will be rehabilitated to original condition
• During mineral excavation, top soil and native
plants are carefully removed and preserved.
• Roughly 5-10 percent of soil harvested from our
mines is usable ore; the rest is returned and
landscape restored to natural form
• Area rehabilitated with original top soil; native flora
is replanted, or site is used by local farmers for
cash-generating agriculture.
• In 2013, Tronox spent ~$6.6 million on SA land
rehabilitation
• Total area in rehabilitation:
• KZN: 176.9 hectares
• Namakwa: 2,063 hectares
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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Land Rehabilitation - Fairbreeze
• Tronox has already planted 4,900
indigenous trees and shrubs at
Fairbreeze
• Biodiversity offsets such as
wetlands and forests in areas
around Mtunzini are part of the
development
Fairbreeze C Extension
© 2014 Tronox Limited | All rights reserved | http://www.tronox.com
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QUESTIONS?
Thank You
A Brighter Future, From the Ground Up