8/8/2019 Ian Ash By

1/24

BHP Billiton Iron Ore Western AustraliaPresentation to Analysts June 2005

Ian Ashby, President and COO BHP Billi ton Iron Ore

I ron Ore

8/8/2019 Ian Ash By

2/24

Iron Ore

BHP Billiton Iron Ore Overview

Record 53.6Mt of iron ore produced in the first half of FY2005

On target to ship over 100Mt this year

Record EBIT of US$408 million in first half of FY2005 (two years ago full-year EBIT was US$464 million)

Renewed efforts towards Zero Harm following three fatalities last year

Cost-efficient incremental expansions completed and underway, in linewith

market demand

Operating Excellence is continuing to deliver with almost 60 businessimprovement coaches driving incremental efficiency and effectivenessimprovements

Preparing for the next phase of growth and beyond

8/8/2019 Ian Ash By

3/24

Iron Ore

Business Vision and Drivers

VisionVision

Safest, most profitable, productiveSafest, most profitable, productiveand efficient global iron ore producerand efficient global iron ore producer

DriversDriversSustainable GrowthSustainable Growth Cost and EfficiencyCost and Efficiency

People ManagementPeople Management Product QualityProduct QualityPlanningPlanning MarketMarketHealth, Safety, Environment and CommunityHealth, Safety, Environment and Community

8/8/2019 Ian Ash By

4/24

Iron Ore

OperationsBOODARIE IRON

Extensive iron ore resourcessupporting a range of mines

Communities: Newman (4,000) Hedland (15,000) Pilbara (40,000); and

12% Indigenous

Railway track 1000kmOre carriages 3395Locomotives 68Car dumpers 4Reclaimers 8Stackers 17Crushing plants 3

OB 18

8/8/2019 Ian Ash By

5/24

Iron Ore

Continuing the Journey Towards Zero Harm

Safety Initiatives

Take 5 / Job Hazard Analysis

Fit for Life

Leaders Walk the Talk

Job Safety Observations

Near Miss Reporting

BHP Iron Ore

Page 2

Take

1. Think through the task

2. Spot the hazard

3. Asses the risk

4. Make the change

5. Do the task Safely

BHP Iron Ore

Page 2

Take

1. Think through the task

2. Spot the hazard

3. Asses the risk

4. Make the change

5. Do the task Safely

8/8/2019 Ian Ash By

6/24

Iron Ore

22

20

1016

14

12

10

8

6

42

0Jun-03 Aug-03 Oct-03 Dec-03 Feb-04 Apr-04 Jun-04 Aug-04 Oct-04 Dec-04 Feb-05 Apr-05

CIFR 12 Month Rolling Average

Monthly CIFR

Continuing the Journey Towards Zero Harm

8/8/2019 Ian Ash By

7/24

Iron Ore

Strong EBIT Performance (BHP Billiton Share)

0

50

100

150

200

250

300

350

400

450

Jun-0

0

Dec-0

0

Jun-0

1

Dec-0

1

Jun-0

2

Dec-0

2

Jun-0

3

Dec-0

3

Jun-0

4

Dec-0

4

Half Year Ended

EBIT(US$

million)

8/8/2019 Ian Ash By

8/24

Iron Ore

Strong Production Performance (100% Terms)

0

20

40

60

80

100

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

Cummulative Product ion FY2005

Production

(Mwmt)

Q4 FY2005 Annualised Production Rate ~110Mtpa

8/8/2019 Ian Ash By

9/24

Iron Ore

Unit Cost Performance Relative A$/t Movement

0

20

40

60

80

100

120

2000 2001 2002 2003 2004 YTD 2005

Index 2000 = 100

8/8/2019 Ian Ash By

10/24

Iron Ore

Growing Sales in Key Asian Markets (100% terms)

Europe3%Taiwan

6%

SouthKorea

15%

Japan

37%

China

35%

Australia

4%

Europe4%

Taiwan

6%

SouthKorea

14%

Japan

35%

China

32%

Australia

9%

FY2005* WA Iron Ore SalesFY2004 WA Iron Ore Sales

* YTD FY2005

8/8/2019 Ian Ash By

11/24

Iron Ore

New JVs Strengthening Long Term Relationships

Wheelarra Joint Venture (Sub Lease of Jimblebar) (12Mt/a) 51% BHP Billiton Minerals Pty Ltd

10% Maanshan Iron & Steel Co

10% Tangshan Iron & Steel (Group) Co

10% Wuhan Iron & Steel Corporation 10% Jiangsu Shagang

4.8% Itochu Minerals & Energy of Australia Pty. Ltd.

4.2% Mitsui Iron Ore Corporation Pty Ltd

POSMAC JV (Sublease of Mt. Goldsworthy JVs C Deposit) (~15Mt/a) 65% BHP Billiton Minerals Pty. Ltd.

20% POSCO

7% Mitsui Iron Ore Corporation Pty. Ltd.

8% Itochu Mineral and Energy Australia Pty. Ltd.

Mt. Newman JV (~38Mt/a)

Mt. Goldsworthy Mining Associates JV (~7.5Mt/a)

Yandi JV (~42Mt/a)

BHPBIO is the operator and marketer for each of the above Joint Ventures

8/8/2019 Ian Ash By

12/24

Iron Ore

Growth - Maintaining Share of Expanding Markets

Area C & PACE completed ahead of schedule and within budget

RGP 1 (110Mtpa) completed end 2004 ahead of schedule and within budget

RGP 2 (118Mtpa) expansion on schedule and budget for completion by the 2nd halfof 2006

Blueprint for growth >152 Mtpadeveloped and team in place Extensive Pilbara resource base - major drilling program and studies underway

Execution will be phased to meet market outlook and reduce exposure to

overheated construction market in Western Australia

Expect to announce the first phase of the expansion in Q4 CY05 following Board

and Government approvals

8/8/2019 Ian Ash By

13/24

Iron Ore

Growth Expansion Options

Feasibility study into several expansion options completed in early 2005

Growth will primarily be achieved through the expansion of well-established

Newman, Yandi and MACbrands and further growth of a new product (Brockman

Sinter Fines)

Expansion options include:

A business redesign to improve efficiency and operating performance. Development of Mining hubs at Newman, Area C and Yandi

Development of a further Mining hub for Brockman Sinter Fines product

8/8/2019 Ian Ash By

14/24

Iron Ore

Growth Expansion Options (contd)

An expanded rail system and a reconfiguration of the port operations will support

the expansion options

Growth capital US$50 60/tpa, plus system efficiency investment of

US$10 15/tpa. Compares favourably with previous projects given cost pressures

and FX rate

Expansion will also deliver significant environmental benefits, including ~30%

reduction in dust emissions in Port Hedland.

8/8/2019 Ian Ash By

15/24

Iron Ore

Growth Opportunity - FY2012

0

20

40

60

80

100

120

140

160

180

66 68 1970 72 74 76 78 1980 82 84 86 88 1990 92 94 96 98 2000 02 04 06 08 2010 12

YEJ

BHPBWAIOSales(Mtpa)

Chinese

demand

drives

massive

growth

Area C and PACE +15 MtpaApril 02

RGP 1 +10 MtpaFebruary 04

RGP 2 +8 Mtpa

October 04

LTE +42 Mtpa1st phase by end 05

Project + Incremental Vol.Approval Date

Inter im Exp'n +7 Mtpa2003

Options beyond 152 Mtpa

8/8/2019 Ian Ash By

16/24

Iron Ore

Addressing Issues Facing the Business

Safety culture and performance

Behavior based safety

Leadership

Contractor management

Training

Attraction & retention of good people Housing renewal and upgrade

Community programs

Strategic approach to education and training (including Indigenousemployment)

8/8/2019 Ian Ash By

17/24

Iron Ore

Addressing Issues Facing the Business (contd)

Enhancing quality of l ife in Pilbara communit ies

Town amenity (dust management, Enhancement Scheme, anti-crime

programs)

Community facilities & services (health, education, recreation, arts)

Government services (working with Government on improved service

provision)

Community information (consultative forums, communication programs)

Boodarie Iron

Care & Maintenance announced November 2004

Majority of employees have found alternative employment arrangements

(including ~80 redeployed to other BHP Billiton operations)

Decision on future of the plant expected in coming months

8/8/2019 Ian Ash By

18/24

Iron Ore

Conclusion

Maintaining our focus on the achievement of Zero Harm to people and theenvironment

On track for record production and EBIT in FY2005

Expansion projects on schedule and budget

Preparing for next stage of expansion focus on managing cost and supplypressures

Consulting with local communities and Government to ensure win:win outcomesfrom growth projects

Laying foundations to sustain position over the longer term

8/8/2019 Ian Ash By

19/24

Iron Ore

8/8/2019 Ian Ash By

20/24

Iron Ore

Back up slides

8/8/2019 Ian Ash By

21/24

Iron Ore

RGP 1Area C Plant Expansion

8/8/2019 Ian Ash By

22/24

Iron Ore

RGP 1Area C Plant Expansion

8/8/2019 Ian Ash By

23/24

Iron Ore

BHP Billiton Iron Ore Products YEJ 2005

1.30.0050.0461.504.964.3Goldsworthy HighGrade

1.40.0060.0461.604.764.2Goldsworthy HighGrade

6.20.020.0531.202.063.1MACTM

2.20.0050.0551.807.5061.0

0

Goldsworthy Medium

Grade

9.40.0150.0360.765.059.1Yandi

1.90.0120.0571.303.165.2Mt. Newman

LOISPAl2O3SiO2Fe

Lump For Direct BF Feed

6.20.010.0661.903.061.8MACTM

2.80.0060.0552.608.0060.0Goldsworthy MediumGrade

9.70.010.0371.345.158.5Yandi

2.50.010.0702.103.663.6Mt. Newman

LOISPAl2O3SiO2

Fe

Fines for Sintering

8/8/2019 Ian Ash By

24/24

Iron Ore

Orebody Development

OB 25

OB 18 continuation

Area C Expansion

E depositA west

F deposit

D deposit

Expansions

Jimblebar

Mining Hubs

Yandi

Area C

Newman

Port & RailDevelopments

Eastern Yard

4 ports

Relocate C&S

Passing SidingsRail loops andbridges

Rolling stock

Goldsworthy

Cattle Gorge

Y4 Crustal

FI Bene Plantclosure

OB 18

BOODARIE IRON