THE TAMPAKAN PROJECT: Setting the Standard for Responsible Mineral Resources Development

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THE TAMPAKAN PROJECTSetting the Standard for
Responsible Mineral Resources Development

• Newsbreaks Media Dialogue of CSR
• 27 August 2007, Davao City

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Presentation Outline

• Project Overview
• Laying the Groundwork
• Moving Forward

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• Project Overview

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Overview of Tampakan Project

• Managed by Sagittarius Mines, Incorporated (SMI)
• Now in extended pre-feasibility stage
• Intensive studies on geology, metallurgy, and
  environmental social impact
• Consultations with stakeholders
• Potentially, one of the largest copper-gold
  deposits in Southeast Asia-Western Pacific Region
  
• Xstrata Copper recently exercised option to
  acquire 62.5 of the controlling interest in
  Project and assumed management control of SMI on
  30 March 2007.

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Xstrata Copper

• Xstrata Copper is one of the commodity business
  units within the major global diversified mining
  group Xstrata plc.
• Xstrata Coppers mining and processing operations
  are located in five countries Australia,
  Argentina, Chile, Peru and Canada.
• World-leading portfolio of copper development
  project including Las Bambas, Peru El Morro,
  Chile El Pachon, Argentina Frieda River, Papua
  New Guinea and Tampakan, Philippines.
• Xstrata Copper is the worlds fourth largest
  copper producer with an annual managed production
  of over one million tonnes of copper, and
  potential for further growth

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Xstrata Copper
Operations and projects in seven countries 8
mines 4 smelters 3 refineries 3 SX-EW
plants 6 projects 1 recycling business
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Location of Tampakan Project

• South Cotabato ProvinceTampakan
  MunicipalityBarangays Pula Bato, Danlag
  Tablu Folu Bato, Sbangken and Danlag Tribal
  CommunitiesDavao del Sur ProvinceKiblawan
  Municipality Barangay KimlawisBong Mal Tribal
  CommunitySultan Kudarat ProvinceColumbio
  MunicipalityBarangay Datal BlaoSalnaong Tribal
  Community

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• Laying the Groundwork
• SMI as a Strategic Stakeholder Partner

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Contributing to the economy

• SMI contributes to the national economy through
• Income tax, VAT, Documentary Stamp tax, Customs,
  Interest on Foreign loans
• SMI contributes to the local economy through
• Real Property tax, Occupation fees, Registration
  fees, Permit fees, and employee salaries.
• A majority of the project workforce is sourced
  from the host communities
• 36 of the officers and staff
• - 10 from Blaan communities
• 100 of the laborers
• 85 of the contractual employees and consultants

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Partnership with our Host Communities

• Principal Agreements
• 5 Tribal Communities
• 5 barangays
• 3 municipalities
• Investments in the development
• of host communities
• Each tribal community P1.5 M/year
• Each barangay P1 M/year
• Each municipality P1 M/year

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Partnership with our Host Communities

• Mobilizing the community for the environment
• Community-Based Environmental Monitoring Program
  a multi-sectoral initiative that trains locals on
  monitoring land, air and water quality in their
  respective communities.

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Partnership with our Host Communities

• Mobilizing the community for the environment
• Maleh to Kayu reforestation program to
  rehabilitate denuded areas of the Tampakan
  mountains with seedlings propagated by local
  households 76,973 trees planted in 2005-2007

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Partnership with our Host Communities

• Mobilizing the community for the environment
• Roadside greening as part of Green Philippine
  Highways 7,698 seedlings planted

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Partnership with our Host Communities

• Mobilizing the community for the environment
• Butterfly/Insect Farming, Apiculture
  Vermiculture trials Biodiversity awareness and
  conservation

Composting using worms at Maticura FTRS
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Partnership with our Host Communities

• Investing in education
• 10,250 grantees from elementary to college
• Promoting health
• 2,266 enrolled in PhilHealth indigent program
• 6,050 treated in medical outreach programs

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Partnership with our Host Communities

• Supporting the community
• Kiblawan-Tampakan-Columbio (KITACO) Growth Area
• Municipal Land Use planning
• Conversion of CADC 170 to CADT

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Partnership with our Host Communities

• Developing the Youth
• Oratorical Storytelling Contests in Region 12
• Sports development
• Silek Blaan Musical Ensemble

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Partnership with our Host Communities

• SMI Competence Centre capacity-building
• Enabling people to participate in the social and
  economic mainstream
• Training programs conducted for the year
• Value Formation and Leadership Trainings
• Livelihood and Enterprise Development
• Food processing for women
• Goat raising
• Cultural management of corn and rice for tribal
  farmers
• Adult Literacy classes in tribal communities
• Skills Training
• Carpentry, masonry, welding, building wiring

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Building a model for responsible mineral
resources development

• Awards
• Presidential Mineral Industry Environmental
  Award, 2004
• ANZCHAM Environmental Award, 2004
• Presidential Mineral Industry Environmental
  Award, 2006
• Best Mining Forest Award, 2006
• TESDA National KABALIKAT Award, 2007
• Recognized for applying best available
  practices in Community Affairs, Environment and
  Safety

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• Moving Forward

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SMI Business Principles are our CSR Principles

• We work ethically
• We are committed to the highest standards of
  personal and professional ethical behavior
• We work responsibly
• We are committed to the highest standards of
  health, safety and environmental performance
• We work openly
• We are committed to the maximum transparency that
  is commercially possible in our business
• We work together and with others
• We are committed to co-operating with employees,
  local communities and other stakeholders

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Environment Policy

• We are committed to the highest standards of
  environmental performance, community co-operation
  and principles of sustainable development.
• This commitment will be achieved through
• Demonstrated understanding of environmental
  accountabilities
• Leadership in all levels of management
• Effective implementation of Environmental
  Management Systems at our operations

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Community Policy

We strive to achieve a reputation for social
responsibility by contributing to the social,
economic and institutional development of our
communities. We will work with our stakeholders
to improve the quality of life for all. Our
community relations practices will be
characterised by open and honest engagement with
stakeholders through effective, transparent
consultation and communication.
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Thank You Mabuhay!

• Ms. Bella Lechonsito
• Community Relations Development
• Sagittarius Mines, Inc.