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ZIRCON ANNUAL REVIEW SAMPLE

NEW EDITION TO BE RELEASED Q2 2014

PROPOSED TABLE OF CONTENTS*

EXECUTIVE SUMMARY

1.0: INTRODUCTION AND ZIRCON MARKET 1.1 Introduction1.2 The global zircon market1.3 Overview of zircon end-uses1.4 Structure of report1.5 Confidentiality and disclaimer

2.0: END-USES: CERAMICS AND SANITARYWARE 2.1 Introduction2.2 Production of ceramic tiles2.3 Zircon in ceramic tiles2.4 Manufacture of sanitaryware 2.5 Segment developments in 2013

3.0: END-USES: SPECIALTY CHEMICALS AND MATERIALS

3.1 Introduction3.2 Zirconium chemicals3.3 Zirconia3.4 Zirconium metal3.5 Segment developments in 2013

4.0: END-USES: REFRACTORIES AND FOUNDRIES 4.1 Introduction4.2 Refractories4.3 Foundries and casting4.4 Segment developments in 2013

5.0: ZIRCON SUPPLY 5.1 Introduction5.2 Zircon supply in 20135.3 Zircon supply by region5.4 Key zircon producers

6.0: ZIRCON DEMAND DYNAMICS6.1 Overview – substitution and thrifting6.2 Zircon demand by region6.3 Demand drivers6.4 Zircon demand by market6.5 Zircon trade in 20136.6 Zircon demand outlook to 2014

7.0: ZIRCON PRICING 7.1 Price forecasting methodology7.2 Overview of 20137.3 Trade7.4 Pricing outlook to 2015

8.0: NEW PROJECTS8.1 New supply8.2 New projects

9.0: STRATEGIC ISSUES AND OUTLOOK

APPENDIX 1 - PRODUCER PROFILES

APPENDIX 2 - CONSUMER PROFILES

APPENDIX 3 – NEW PROJECTS PROFILES

* minor changes may be made to this outline prior to publication

SAMPLE OF 2013 EDITION

THE ZIRCON MARKET AND MAJOR END-USES

DEMAND DYNAMICS

Demand broken down by regions, drivers, growth in end-uses.

Comprehensive analysis of the major end-uses

for zircon

Sections for each

end-use with an examination

of demand drivers

NEW EDITION TO BE RELEASED Q2 2014

For more information contact TZMI | +61 8 9359 6000 | marketing@tzmi.com | tzmi.com

SUPPLY AND PRICING

Examines supply developments in the past year.

Pricing information targets trends by producer and region.

Trade analysis

across the globe

China’s influence on

the zircon market

Export trade analysis by

country

Regionally, Australia remains the largest zircon producing country, accounting for 36% of global production in 2012. ”“

NEW PROJECTS

STRATEGIC ISSUES

This section includes a synopsis of projects in the pipeline. It also includes an outline of each project and its development status.

Key challenges

in the zircon sector

A discussion of thrifting &

substitution and the impact on the

zircon market

Future issues for

the industry

APPENDICES

APPENDIX 1 Producer profiles

APPENDIX 2 Consumer profiles

APPENDIX 3 New projects profiles

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APPENDIX 1 - PRODUCER PROFILES

Richards Bay Minerals

Operations <<RBMminesdunal sanddeposits inKwaZulu-Natal,SouthAfrica,stretchingfrom10to50kmnorthofRichardsBay.Fourseparateminingplantsprovideacombinedminingcapacityofapproximately115milliontpa.Themostrecentminingplantconsistsoftwodredgesandoneconcentrator,andwascommissionedattheendof1999.Itwasdesignedtocompensateforfallingoregrades.AuxiliarydryminingisalsoemployedatRBM,andnowcontributesanestimated15%ofthetotalvolumeoforemined.Muchofthedryminedoreissourcedfromareasinaccessibletothedredgesusedastheprincipalminingmethod.

Mineralconcentrateistruckedtoacentralprocessingplantwhereilmeniteisextractedbymagneticseparationandthenon-magneticsarefurtherprocessedfortherecoveryofzirconandrutile.Themineralprocessingplantcurrentlyhascapacitytoproduceupto240,000tpaofzirconand90,000tpaofrutile.Upto160,000tpaofzirconareacidleachedtoproducea‘premium’gradezircon.

InitscurrentleasestothenorthofRichardsBay,andinanadditionalleasesouthofRichardsBay,itisunderstoodthatRBMhasreservessufficientformorethan20yearsoperationatcurrentminingrates.Presentmeasuredreserves(expressedintermsofslagproduct)standat24.9milliontonnes,withafurther3.0indicatedandinferredmilliontonnescategorisedasresources.

RBMannouncedinMarch2011thatitintendedtomineitsZultiSouthminingleasearea,southofRichardsBay,extendingminingoperationstoaround2043.Miningoftheareacouldstartasearlyas2016.

InMarch2011,thecompanycommissioneditstailingstreatmentplantandbeganproductioninApril2011.RBMplanstotreat2.2milliontonnesof tailings per year.

Recentdevelopments

InFebruary2012,BHPBillitonLtdagreedtosellits37%stakeinRBMtoRio Tinto.

InFebruary2013,RioTintoannouncedthatitwastakingactionatanumberofitsoperationsandwouldplaceitszirconandrutileprocessingoperationsatRBMoncareandmaintenance,whilemaintainingproductionatthecoreilmeniteminingandsmeltingoperations.ThedecisionfollowedtheannouncementofRioTinto’sannualresultsfor2012.RioTintoreportedaUS$3billionlossforthe2012year,citingaUS$14.4billionwritedownrelatingtoaluminiumbusinessesandcoalassetsinMozambique.

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ZIRCON ANNUAL REVIEW 2013

Richards Bay Minerals

Ownership Rio Tinto, RBM’s managing company, owns 74% of RBM’s shares.

BlueHorizon,aB-BBEEconsortiumholds24%and2%isheldinatrustfor employees.

Address POBox401RichardsBay3900 SOUTH AFRICA

Tel:Website:Email:

+27 35 901 3111www.rbm.co.zacommunication@rbm.co.za

Key personnel Jean-FrançoisTurgeon–ActingManagingDirectorDenis Booysen – General Manager, EngineeringFundiDlamini–GeneralManager,CommunitiesandCorporateRelationsBheki Gumbi – General Manager, Human ResourcesJoeyKunji-Behari–GeneralManager,SmeltingandProcessingJohanJacobs–GeneralManager,Technical

Background In 1971, the Industrial Development Corporation began a detailedinvestigationoftheRichardsBayarea.ACanadianproduceroftitaniaslag(QIT)wasalsolookingformajorilmenitedepositsin1974.Thesetwo organisations, together with Union Corporation (later Gencor now BHP Billiton),formedRBMin1976tomineandbeneficiatethevastmineral-richsandsinthecoastaldunesthatextend17kminatwokilometrewidestripfromjustnorthofRichardsBay.In1985thecompanyacquiredtheminingrightstoadditionalorereservesbothnorthandsouthoftheoriginaldeposit.

During2001,RBMstarteddryminingoperationstosupplementitsdredgemining operations.

LegislationpassedbytheSouthAfricanGovernmentin2004requiresthatmining companies sell 26% of their mines to black investors by 2014. The companyannouncedinDecember2008thatadefinitiveagreementwithaBroadBasedBlackEconomicEmpowerment(BBBEE)consortium,BlueHorizon,hadbeensigned.InDecember2009,therand4.5billion(US$55.4million)dealwascompleted.BlueHorizonacquireda24%equityinterestinRBM,with2%oftheequityheldbypermanentemployeesthroughanemployeeparticipationscheme.Itisthelargestbroad-basedblackeconomicempowermentdealintheregiontodate.

InJuly2008,thecompanyannouncedthatithadapprovedmorethanrand1billion(US$147.2million)infundingforanewMSPtailingstreatmentplantproject.Theprojectisexpectedtoextendminelifebyafurtherfiveyears.RBMalsoannouncedplanstogeneratesufficientelectricityin-housetobeable to supply a portion of the power plants requirements; approximately 6.5 MW by 2011.

FollowingthecompletionoftheBBBEEdeal,RichardsBayMinerals(RBM)consistsoftwoseparateoperatingcompanies;RichardsBayMining(Pty)Ltd,whichisresponsibleforminingoperations;andRichardsBayTitanium(Pty)Ltd,whichisresponsibleforthesmeltingandbeneficiationprocess

InApril2009,RioTintoremovedoneofthefourfurnacesatRichardsBayfromoperationforaperiodoffivemonthsforaplannedrebuild.>>

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SAMPLE PROFILE

SAMPLE PAGES

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ZIRCON ANNUAL REVIEW 2013

Structure of the zirconia, zirconium chemicals and metal industries

ZOCPLANTS

ZIRCON SANDFEED

FUSEDZIRCONIA

CHEMICALZIRCONIA

ZIRCONIUMMETAL

BADDELEYITE

FUSED ZIRCONIA

CHEMICAL ZIRCONIA

Zr CHEMICALS

ZIRCONIUM METAL

© TZMI 2013

Zirconisusedinthesanitarywareindustrytoprovideopacityandwhiteness.Zircononlyformspartofthesanitarywareglazeandrarelyisintheceramicstructureofthesanitarywarebody.Thetypical content of zircon in a sanitaryware glaze is between 15-16%.

Specialty chemicals and materials

Zirconiumchemicalscompriseavariedgroup,eachmembercontainingzirconiumasanactiveconstituent. Themost common intermediate product, fromwhichmany of the others aremanufactured,iszirconiumoxychlorideoctohydrateorZOC,whichhastheformula,ZrOCl2.8H2O.

Anotheroften-usedintermediateiszirconiumbasicsulfate,knownasZBS.

Whiletheyhavesignificantlydifferentend-uses,thetwogeneraltypesofzirconia-fusedandchemical - share a range of characteristics which make them valuable materials in various specialist applications.Theprincipaldifferencesbetweenthetwotypesofzirconiaare:

• Chemicalzirconiaisconsiderablypurerthanfusedzirconia,soittendstobeusedintheapplications which require greater precision of performance;

• Thesurfaceareatoweightratioofthecrystalsofchemicalzirconiaisfarhigher.

Refractories and foundries

Zirconhasahighmeltingpointandhighresistancetothermalshock,makingitasuitablecandidatefor use as a refractory in high-temperature applications. Zirconia, exhibits very similar refractory propertiestozircon,exceptthatithasahighermeltingpointandcanbeusedinapplicationswheretemperaturesexceed1,990°C.

Themainadvantageofzirconasafoundrysandisitsrefractorinessandresistancetometalpenetrationaswellasitsabilitytowithstandhightemperaturesforlongperiods.Thisallowszircontobeusedinfoundriesforthecastingofhigh-alloystainlesssteels,attemperaturesashighas1,650°C.

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EXECUTIVE SUMMARY

Thecombinationofthesecharacteristics(refractoriness,lowthermalexpansionandchemicalstability),makezirconanidealnon-silicafoundrysand.Highpriceshowever,meanitisusedonlyinhigh-endcastingsandspecialisedapplications.

Zircon supplyGlobalzirconsupplygrewby23%in2010from2009levels,reaching1.3milliontonnesandreached1.6milliontonnesin2011amidescalatingprices.Thepriceofzirconsandexperiencedasharpcorrectionduring2012.ProlongedeconomicmalaiseinEuropeandoverstockinginChinawerecitedastheprimarycauses,aswellastheperennialpriceincreaseswithwhichcustomersonbothcontinentshadtocontend.

Inlightoftheworsenedmarketconditions,2012witnessednonewprojectsandthereductionofoutputandmothballingofseveralothers.Investmentcontinues,however,andadditionalsupplyin2014,2015and2016canbeexpected.

Regionally,Australiaremainsthelargestzirconproducingcountry,accountingforapproximately36%ofglobalzirconoutput.Thefollowingfigureshowsthedistributionofzirconproductionbycountry in 2012.

SouthAfricaisthesecondlargestzirconproducingcountry,accountingfor30%ofglobalproductionin2012.Chinaisalsofastbecomingakeyzirconproducingcountry.Accountingfor15%ofglobaloutput,China’szircondemandisnowthelargestintheworldasimports80%ofitszircon.

Ilukaremainsthelargestsingleproducerofzircon,accountingforaround30%ofglobalzirconoutputsince2001oraround300,000tonnes.RichardsBayMineralsisthenextlargestzirconproducer,withestimatedannualoutputof270,000tonnesin2012,followedbyChinawith205,000tonnes.

REF 8691

Australia36%

South Africa30%

US 6%

Mozambique 3%

Ukraine 2%

China15%

India 3%

Vietnam2%

RoW3%

© TZMI 2013 NOT FOR REPRODUCTION

©TZMI 2013

Distribution of global zircon production by country in 2012

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