GVK Coal Projects Galilee Basin Coal & Energy Conference

12 November 2012

Presenter – Paul Mulder

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Important notice - Disclaimer

IMPORTANT: The information in this document has been provided to you for information only by the GVK Group (GVK)

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Source: Factset, Factiva, company presentations.

Operations

Eight Power Projects – Gas, Hydro &

Thermal

5,106 MW of Power

India‟s Largest Private Airport Operator

Mumbai International Airport – 30m pax

Bangalore International Airport – 12m pax

India‟s First 6 Lane Expressway

Over 550km of roads under construction /

development with plans for Mass Rapid

Transit

Greenfield port planned (Gujarat

7 deepwater oil & gas blocks in partnership

with BHP Billiton

Alpha and associated port and rail

infrastructure

Kevin‟s Corner and Alpha West deposits

Two mines in India

Two large-scale integrated developments in

urban environments

Airport City (Mumbai) and GVK One

(Hyderabad)

6 world-class properties and one under

construction

Total room base of over 1,000

Provides a broad spectrum of across the

R&D value chain in chemistry, biology and

informatics;

Pow

er

Airport

s

Tra

nsport

O

il &

Ga

s

Hote

ls

Urb

an

M

inin

g

GVK Group includes GVK Power and Infrastructure Limited (“GVKPIL”) and various other

interests of the GVK Family

GVKPIL is a listed entity and an ultimate holding company of “GVK” which operates in

diversified assets through different vertical businesses

GVK‟s assets are predominantly in energy, airports and transportation

Revenues are derived primarily from O&M fees, incentives for operating the businesses of

subsidiaries, and secondarily from the interest income earned out of managing surplus funds

through superior financial planning

GVK employs over 8,000 people plus another 18,000 staff for its not for profit EMRI business

Project value add

GVK is a natural strategic fit for the Alpha Project

Ability to link Australia to India and the Ultra Mega Power Projects (UMPP) programme

As a major emerging coal user, GVK is committed and aligned to the successful development

of its Galilee Basin projects

Infrastructure expertise

GVK is a leading infrastructure player

The development of the rail and port infrastructure is the key to opening up and developing

the Galilee Basin

Experience in financing and developing large scale projects

Investment / financing capability

GVK has strong relationships with leading global banks across debt and equity

It has a track record of success in working with partners and attracting financing for the

delivery of large complex projects

Commitment to Australia

GVK is committed to expanding its business in Australia

GVK is seeking to expand its resource and infrastructure portfolio to include Australia,

particularly Queensland with its Galilee Basin investment being its seed asset.

Overview

Bio

scie

nce

Introduction to GVK

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GVK EMRI – Our Innovative PPP (Public Private not for Profit Partnership)

Service Delivery Model to provide free Emergency Response Services

Size

350 million people covered in 11 States

Employing more than 18,000 people

3200 ambulances

120,000 calls handled per day

12,000+ emergencies handled per day

Over 300 lives saved per day

Speed

Went live in less than 4 months from signing MoU

91% calls taken in first ring

Impact

280,000+ lives are saved to date

GVK EMRI – Saving Lives

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Queensland Projects Overview -

Alpha Coal Development

Pit to Port Logistics

Abbot Point T3 Terminal

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Alpha Coal (GVK 79%) Kevin‟s Corner (100%) Alpha West (GVK 79%) GVK Railway (100%) GVK Port (100%)

Expected to be the first thermal coal

project to commence mining in the

Galilee Basin

It will rank as one of the largest thermal

coal operations in the world and

represents the next generation of

independent thermal coal supply

Up to 32Mtpa export grade thermal coal

Also expected to rank as one of the

largest thermal coal mines in the world

Up to 30Mtpa export grade thermal coal

mine

Large underground mine west of Alpha

16-24Mtpa export grade thermal coal

mine

The first standard gauge, heavy haul

railway in Queensland

Designed to replicate the efficiencies of

the Western Australian iron ore industry

495km, standard gauge, stand alone rail

link from Galilee Basin to Abbot Point

25,000t haul per train

Dedicated terminal at Abbot Point

Queensland‟s most northern coal port

Ability for up to 70Mtpa subject to more

efficient use of stockpile area and berth

configuration

1.82Bt resource

1.2Bt reserves 4.3Bt resource 1.8Bt resource

60Mtpa capacity

Scalable to 120Mtpa

Awarded Preferred Developer for T3

Framework Agreement agreed

Open cut mining, 30 years mine life

First coal by Q3 2016

Ramp up from 2016 to 2019

Open cut & underground mining

30 year mine life

Underground mining

30 year plus mine life

First privately owned railway in

Queensland Offshore berth option most likely

High grade thermal coal for export

markets, mainly suitable for the premium

North Asian utility market

FOB - US$54.8 – 57.5/tonne (Real)

High grade thermal coal for export

markets

First coal by Q2 2017

Ramp up from 2017 to 2020

High grade thermal coal for export

markets

Pre feasibility drilling has commenced

Mining targeted for 2018

EIS approved by State and Federal

governments

Rail corridor selected by State

government

2 x 30Mtpa stockpile capacity

2 x dedicated ship berths

DFS and BFS completed

EIS and EPBC approved

Mining lease to be issued by Q1 2013

Native Title negotiated

ECI contractors short listed

LOIs for 43Mtpa received

Preferred mining contractor appointed

EIS and SEIS submitted

BFS has commenced

Mining lease expected to be issued by

Q1 2013

Native Title negotiated

Concept study completed

BFS expected by 2014

Leverage Alpha related studies and

approvals

Rail corridor approved

Third Party and ACCC consultation

underway

Native Title negotiated

State significant project

Land acquisition starting

Port approval by Federal government

The Galilee Basin assets comprise a large scale, high quality thermal coal resource with integrated rail and port infrastructure located in

Australia’s next major coal basin

Project Overview 1

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The thermal coal projects

comprise Alpha Coal Project,

Kevin‟s Corner and Alpha West.

Alpha is expected to be the first

thermal coal project developed in

the Galilee Basin.

Represents the next generation of

independent energy supply

Project Location

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Depth

16m

43m

52m

First and only exporter of coal from the Galilee basin to date. 125k

ROM mined

Coal burning tests undertaken in Korean and Chinese coal fired

power stations (Q4 2011)

Validation of geotech parameters and ground water assumptions

C and D seam washing yields greater than forecast (~84%)

Excellent burn results and coal quality parameters as good or better

than projected in the BFS

Significant de-risking of the project

Successful Test Pit

GVK Coal – Test Pit

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Overview

The GVK Railway will

comprise initially a new

single track, non-electrified,

standard gauge, heavy-

haul 495 km (mainline)

railway

Connects the Alpha and

Kevin‟s Corner mines with

the Hancock Port Terminal

at Abbot Point

Initial capacity of 60Mtpa

and scalable to 120Mtpa.

Duplicated to 250Mtpa

1 in 320 ruling grade

(loaded trains)

Designed to replicate the

efficiencies of the iron ore

industry in Western

Australia

Standard gauge may

generate costs savings of

~40% over narrow gauge

Asset description

Rail Rate Unit

Standard gauge 1,435 mm

4ft 8.5in

No of Wagon per Train 240

Train Length 3,866 m

Wagon Payload 106 t

Wagon Gross Weight 130 t

Axle Load 32.5 t

Payload per Train (approx) 25 kt

No of Locos per train 3

Rail Length 495 km

Train Travel Time (loaded) 10 hrs

Train Travel Time (empty) 8.5 hrs

No of Passing Loops (@30Mtpa) 5

No of Passing Loops (@60Mtpa) 9

Loco capacity 4,400 hp

3,236 kw

No of Trains (@30Mtpa) 4 sets

No of Trains (@60Mtpa) 8 sets

GVK Railway

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Milestones Achieved

Technical Design – has been completed for a 60Mtpa from both a construction and operation perspective. Focus is on

earthworks and geotechnical (completed by June 2012) which will be undertaken in the Early Contractor Involvement phase

(which precedes the final EPC bid in February 2013) and Financial Close.

Advanced Approvals – The Co-ordinator General‟s Report was issued on 29 May 2012. which was subsequently ratified by

the Federal Government. This is a major approval milestone for the rail. The GVK rail corridor alignment was endorsed as the

preferred South to North corridor by the Queensland State Government on 6 June 2012. The Mine & Rail were also granted

approval under the EPBC Act by the Federal Government on 23 August 2012.

Rail Corridor Land – More than two thirds of the rail corridor (by chainage) has commercial arrangements/agreements in

place.

Construction - Two contract consortia short listed.

Infrastructure Operators Shortlisted – we have an established short list for above and below rail operators.

Operational modeling - has been completed and includes modeling for short listed third party rail haulage customers.

RIM accreditation – has been granted under the Transport (Rail Safety) Act 2010 (Qld).

Rollingstock – Locomotive and coal wagon sourcing being progressed.

McKinsey – we have retained McKinsey to review opex and capex savings across the construction and operation of the

railway.

GVK Railway - Status

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Overview GVK Infrastructure has been appointed preferred developer of the

GVK Port Terminal

Key features of the development include:

– Two rail receival dump stations located in a single common

concrete vault and building, situated on the proposed rail loop

corridor

– Two inloading conveyor streams running in parallel, consisting of

four inloading conveyors per stream, feeding coal to the

stockyard

– A single stockyard consisting of four stockpile rows arranged

either side of two parallel machine bunds (two rows per bund)

– Two machine bunds, each supporting two stacker/reclaimer

machines

– Two outloading conveyor streams running in parallel, consisting

of five outloading conveyors, surge bin, sample plant and

shiploader on each stream

– One common piled jetty structure, two piled wharf structures to

support the offshore outloading conveyors, shiploaders and

access roadways and multiple, piled berthing and mooring

dolphins

– Civil infrastructure, including stockyard drains, sediment ponds,

stormwater return dam and dredge spoil disposal bunds

GVK‟s proposed

offshore terminal

Dual high capacity (9,500 tph)

train unload stations in a common

vault

Approximately 2Mt of stockyard

capacity representing 3.3% of

annual throughput

GVK Port - Features

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Abbot Point

GVK’s

proposed

stockpile

position T3

(note

needs t

o c

ross W

etlands)

Port - Stockpile Position

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Milestones

• Technical Design – ongoing work has been undertaken and ability to increase port

throughput has been confirmed

• Framework Agreement – this agreement which sets out the relationship governing the

arrangements between NQBP agreed and executed

• Advanced Approvals – significant work undertaken with regard to cumulative impact studies

and dredging approvals.

• Infrastructure Operators Shortlisted – we have established a short list for port operators

• Port Capacity for Third Party Rail Customers– a number of the potential rail customers are

seeking access to port capacity.

• EPBC Act “T3” approval received 10 October 2012

• Construction Contract – Samsung and Smithbridge Joint Venture announced 17 October

2012

GVK Port - Status

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EPC Work Packages and Procurement Items

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Project to be delivered through fixed cost, fixed time EPC contracts with large global builders with requisite expertise and experience

Process started in November 2011 with contractors commencing for Phase 2 – ECI phase

Parties short listed

All shortlisted EPC documentation to be finalised in Q1 2013

Construction Processes

Executed ECI Deed, Design,

Scope Definition, Deliverable,

Schedules & T&Cs

PHASE 1 PHASE 2 PHASE 3

BIDDER

BIDDER

BIDDER

GMAX Bids,

Clarifications & ECI

Deed

BIDDER

BIDDER

BIDDER

BIDDER

EPC Proposal with

Lump Sum Price,

Executable Draft Contract

Award & EPC Contract

Execution

Contractor

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Procurement And Contracts - Work Packages

Procurement & Contract

Work Packages

Mobile Fleet

Excavators

Draglines

Large Excavators

Ancillary Gear

Rail Loco‟s and Wagons

Tyres

Fuel

Mining Services

Agreements

Port Operators

Rail Operators

Services Agreements:

Major service

agreements for the

Contractor Operated

Facilities

Major Capital

Purchases

Major Commodity

Purchases

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Supporting Services – Local Community, Major Water &

Power Supply

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Water

A three pronged approach is being considered for the supply of water to the mine

• Pit dewatering bores will provide the required construction water and supplement the water

demand during operations

• Operations water will be supplied by either

o Water harvesting (during high flow periods) from the Belyando/Suttor system and storage in

multiple, low evaporation design, dams

o Water pipeline (approximately 220km) from the Fairbairn Dam - sufficient water allocations

have been purchased or options are in place to purchase

Power

• Connection access agreement in place for Galilee Projects

Water / Power

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Power

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GVK / Hancock’s Community Focus

• Alpha Community Support Program

• Enterprise Whitsundays Partnership

Program

– Regional Indigenous Employment

Program

These community support programs

cover the areas of:

– Education and Training

– Environment

– Arts and Culture

– Health and Safety

– Community / Charity

– Sports

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Local Opportunities

T3 Operational Workforce – approximately 100 full-time employees

Mine Operational Workforce (inc CHPP) – approximately 1600 employees (including shutdowns)

Rail Operational Workforce - approximately 200 full-time employees

• Operations workforce will be engaged on a mix of continuous shift, rotating day shift and day work

• Expect that operations workforce will be locally and regionally based

• GVK committed to providing opportunities for locals to undertake training and development

• The Alpha Coal Project is committed to working with businesses and industry in the region and will encourage

our contractors to partner or establish strategic relationships with local firms through the contracting and ECI

process

• The project‟s Industry Capability Network (ICN) gateway is currently the principle means of communicating with

potential suppliers and contractors

For future company contracting queries or Expressions Of Interest, please direct your enquiries via the following

links:

Mine Opportunities www.gateway.icn.org.au/project/653/hancock-coal-mine-opportunities

Railway Opportunities www.gateway.icn.org.au/project/654/hancock-coal-railway-opportunities

Port Opportunities www.gateway.icn.org.au/project/655/hancock-coal-port-opportunities

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Market Demand and Customer Base

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World thermal demand will more than triple in volume, mainly fuelled by the insatiable demand

of China and India, reaching 2.1 Bt by 2030. This represents an increase of 1.4 Bt over 2011‟s

expected 728 Mt – or effectively two Alpha projects per annum. Growth is primarily concentrated

in the Pacific basin.

Global Seaborne Thermal Coal Demand

Global thermal seaborne import coal demand by country and by rank, China, India, all others (Mt)

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Reasons why GVK invested in this Project

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Global Cost Curve (2021)

The Alpha Coal project is expected to sit on the first quartile of the global thermal coal cost curve

(2021). It is expected to be amongst the most cost efficient mines in Australia

Note: Global seaborne supply is forecast to be ~1.4Bt in 2021

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Total Commitments in 2018 by Region

• China

• Korea

• Japan

• Taiwan

• Vietnam

• Philippines

• Malaysia

• India

• Other

STRICTLY PRIVATE AND CONFIDENTIAL

Alpha Coal Marketing

Storage and

Handling

Coal will handle well on stockpiling and

transport

Milling

Low to moderate power consumption

Alpha coal is not abrasive

Very low mill wear

Boiler

Excellent Ignitability

Excellent Flame Stability at full load

Favourable Turn Down performance

High C Burnout Efficiency (99.8%)

Low C in Ash (1.3%)

Slagging deposits were minimal, Powder and

Sinter Type only.

Fouling deposits minimal, Powder Type only

Low to moderate soot blowing will control

deposition and maintain heat transfer

Environmental

High fly ash migration velocity, Low level of

particulate emissions

Moderate SOx emissions

Moderate NOx emissions

Trace elements well below World export coal

average levels

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Downswing Upswing Downswing Upswing

Likelihood of Project Development During Business Cycle Project Cost Curve Position

- Quartile 1

- Quartile 2

- Quartile 3

- Quartile 4

High probability of being developed

Low probability of being developed

Coal Business Cycle

Quality Projects Are Always Developed

Markets overshoot and undershoot but quality projects like Alpha that sit on the first quartile of the cost curve are

nearly always developed

Industry Growth (+)

Industry Contraction (-)

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Steps Forward

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Rail & Port

Infrastructure

Customers

Infrastructure

Operators

ECI Process

Started in Sep 2011

Stapled opportunity of rail and port

Keen interest from very advanced & developing customers representing up to 207 Mtpa of

coal capacity

Discussions on Tariff and Haulage Agreement ongoing

Key terms, including tariff and take or pay volumes, expected to be finalised by Q4 2012

Started in Sep 2011

Operators shortlisted after a extensive review of technical and safety related parameters

Term sheets for Operations & Maintenance and for investment provided

Preferred operators to be announced in Q4 2012

Contractors for Phase 2 shortlisted

Aligned with ECA financing

Final EPC contract to be finalised in Q1/2, 2013

(Port signed 17 Oct 2012), CHPP, MIU, Rail, Port underway

The following Project partnering processes are well advanced

Project Partners

Mine Customers

Started in 2009

Over 42Mtpa of customer arrangements

Excludes potential investors that are offtake

Final bankable offtake agreements being signed

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2009 2010 2011 2012

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 „13 „14 „15 „16

Order of magnitude

Pre-Feasibility Studies

Bankable Feasibility Studies

ECI/FEED

Finance

Enviro / govt approvals Tier 1

Enviro / govt approvals Tier 2

Financial close

Construction

Marketing

First coal

Project first shipments

Financial close is expected to occur by 30 June 2013

Letters of Intent Offtake Contracts

Project managed process Statutory process Milestone

Timetable

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Thank You