State of the Market:

Nordic mining

in a

global context

Thorium

dra

win

g:

Kaia

nders

Sem

ple

r.

Magnus Ericsson

Mining on Top Helsinki, 16/17th September 2013

Agenda

• Background

• Metal prices

• Ore production

• Exploration

• Capex

• Nordic countries

Manganese drawing: Kaianders Sempler.

Background

Special properties of metals

• High strength

• Affordable cost

• Conduct heat and electricity

• Beautiful

• Undestructable

Source: T. Graedel, Yale University.

Copper use and urbanisation

Source: ICSG, Raw Materials Group.

Indonesia

Pakistan

Philippines

Switzerland

Thailand Zambia

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1 10 100 1000 10000

Urb

an

isa

tio

n

Population (m)

Series13

China

India

USA

Germany

Sth Korea

Japan

Brazil

Chile

Russia

UK

Malaysia

World Population million

Urb

an

isati

on

Growth assumptions 2012-21

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2012 2015 2015-2021

World 2.0 4.4 4.7

United States 3.6 4.0 4.0

EU -0.9 3.5 4.0

Japan -1.0 2.0 3.0

Other advanced economies 2.5 4.5 4.5

China 7.9 6.0 6.0

India 0.7 6.5 6.5

Brazil -3.2 3.0 3.5

Other emerging and developing

economies 2.7 6.0 6.5

Russia 2.6 3.5 3.5

Manganese drawing: Kaianders Sempler.

Background

• Metals cannot be replaced.

• Extended period of growth.

• China/Asia still major engines.

• Infrastructure & personal use.

• Supply constraints increase.

Nickel drawing: Kaianders Sempler.

Metal prices

Metal price index

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0

5000

10000

15000

20000

25000

30000

35000

40000

0

100

200

300

400

500

600

700

RMG Price Index Iron Ore Copper

Nickel Zinc Aluminium

Lead Potash Phosphate

Metallurgical coal

Index = 100 year 2000 USD/t

Metal prices II

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0

200

400

600

800

1000

1200

1400

1600

1800

0

100

200

300

400

500

600

700

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

e

20

14

e

20

15

e

20

16

e

20

17

e

20

18

e

20

19

e

20

20

e

20

21

e

RMG Price Index Gold Silver PGMs

Index = 100 year 2000 USD/oz

Au, Ag,

PGM

Metal prices III

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0

5000

10000

15000

20000

25000

30000

35000

40000

0

500

1000

1500

2000

2500

3000

3500

Lead $/t Aluminium $/t Zinc $/t

Potash $/t Metallurgical coal $/t Phosphate $/t

Iron Ore $/t Nickel $/t Copper $/t

USD/t

other USD/t

Ni, Cu

Nickel drawing: Kaianders Sempler.

Metal prices

• Weaker prices mid-term.

• Bounce back 2015/16.

• Long term slow increase.

Ore production

Neodymium drawing: Kaianders Sempler.

Total ore production

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0

5000

10000

15000

20000

25000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Mt

Other

Gold

Copper

Iron ore

Met coal

Thermal

coal

Ore production

Neodymium drawing: Kaianders Sempler.

• Metal ores 2012 11 Mt.

• Total incl. coal 2012 18 Mt.

• 2000-2012: 100 % increase.

• 2020 growth slow down.

Capex

Tungsten drawing: Kaianders Sempler.

Mining capex

0

50000

100000

150000

200000

250000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

MUSD

Capex

Tungsten drawing: Kaianders Sempler.

• Steep decline 2014.

• Rebounce already in 2015?

• Top twenty companies ~ 50%.

• Fe/Cu/Au > 85 % of total.

• Latin America, North America

growing.

• Australia stable, Africa?

• Long term slow growth,

not reach 2012 this decade.

Vanadium drawing: Kaianders Sempler.

Exploration

Exploration

0

2

4

6

8

10

12

14

16

18

20

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

20112012f

2013f

2014f

2015f

2016f

2017f

2018f

Billion USD

Note: Nonferrous Source: MEG, forecasts RMG

Vanadium drawing: Kaianders Sempler.

Exploration

• Lack of exploration.

• Serious problems for

the future.

Nordic

countries

Copper drawing: Kaianders Sempler.

European mining I

Source: Raw Materials Data, Stockholm 2013.

4.31 %

European mining II

Source: Raw Materials Data, Stockholm 2013.

7.89 %

Mining investments

Sweden 1996-2011

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3%

1996

0

2

4

6

8

10

12

14

16

18

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

% of total

Mining investments

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3%

1996

Kiruna

Kaunisvaara

Dannemora Sydvaranger

Talvivaara

Kevitsa

Aitik

Garpenberg

Kittilä

Laiva Kankberg Kemi

Järn

Nickel

Koppar

Zink/Bly

Guld

Krom

Nordic ore 2010-20

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0

50

100

150

200

250

300

Sweden

Norway

Greenland

Finland

Mt

Nordic exploration

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MEUR

Nordic

countries

Copper drawing: Kaianders Sempler.

• Leading metals miners.

• Continental coal mining

not to be overlooked.

• Exploration decline.

• R&D leading EIP.

• Investment activities high.

• Increasing difficulties.

Rare esrths drawing: Kaianders Sempler.

Conclusions

• Demand continues but

slower growth pace.

• Supply constraints

increasing.

• Prices remains high.

• Capex bottoms out 2014.

• Nordic countries:

• Dominates metals.

• But including coal,

small actors.

• Increasing obstacles.

• Joint government action

necessary.

Copper drawing: Kaianders Sempler.

Raw Materials Group

Magnus Ericsson

PO Box 3127

SE-169 03 Solna

Tel: +46-8-744 00 65

E-mail: magnus.ericsson@rmg.se

www.intierrarmg.se

Kiitos/Tack/Thank you !

Elements drawings: Kaianders Sempler.

Elements first isolated by Finnish and

Swedish chemists and metallurgists in

the 18/19th century.

Raw Materials Group

• Part of the IntierraRMG group since 2012.

• 30 years industry leadership in data, mapping,

analysis and reporting.

• IntierraLive and Raw Materials Data.

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– Mining companies, equipment & service.

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– Governments, International organisations.

• Pre-feasibility/Feasibility studies:

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