Mineral Sands Mining and Processing

Iluka Resources Ltd

3 May 2011

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Mining in Mineral Sands

Mining method selection Depth Hardness Ground water Pit geometry Ore body geometry Sequencing Environmental effects

Objectives Minimise unit costs Sustainable mining

General Mining Sequence

Ore to out of pit mining unit

Small bund or drain to aid in

directing reclaimed tails

water

Unconsolidated tails beach

Tailings water collection point

Distance to be greater than

100m

Distance to be approximately

100m

Overburden stripping

Top soil and sub soil removed

Topsoil and Subsoil Removal

Overburden Stripping

Overburden Stripping

Overburden Stripping

Ore Mining

Ore Mining

Ore Mining

Ore Mining

Tailings Backfill

Tailings Capping

Rehabilitation

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Depth and Hardness

• Strip ratio’s vary widely Kulwin 1:5 Jacinth-Ambrosia 1:0.4 Douglas - Varied

• Generally ‘free dig’ overburden and ore some ripping required indurated material usually laminar oversize material +2mm varies

between 2 and 20%

Groundwater

• J-A, Douglas and WA mines above the water table• Kulwin and WRP mostly below the water table• Infiltration of up to 120 l/s disposed into pit void• Hypersaline environment• 4-6 weeks dewatering dewater before mining ore

Ore Body Geometry

• Typically beach head or strand style • Strands generally shorter life• Ore body thickness – 0.5m to 18m• Strand lengths up to 14km• Strand width mineable down to 10m• Mining method to maximise recovery• Flexible fixed plant solutions required

Ore Body Geometry

Med.grained sand with irregular patches of HM

Med.grained sand with abundant fine HM laminations

Fine-med. Grained sand with numerous fine HM laminations-minor x-bedding

Coarse sand and gravels with finer med.sand interbeds

v.Fine white silty sand

35.6 – 9 - 4

35.1 – 9 - 16

3.5 – 16

8.9 – 11

4.2 – 11

0.1 – 6

1.5 – 16

Expected drill hole location

280mm

200mm0mm

v.Poorly sorted v.Coarse gravels and cobbles

Med.grained sand with irregular patches of HM

Med.grained sand with abundant fine HM laminations

Fine-med. Grained sand with numerous fine HM laminations-minor x-bedding

Coarse sand and gravels with finer med.sand interbeds

v.Fine white silty sand

35.6 – 9 - 4

35.1 – 9 - 16

3.5 – 16

8.9 – 11

4.2 – 11

0.1 – 6

1.5 – 16

Expected drill hole location

280mm

200mm0mm

v.Poorly sorted v.Coarse gravels and cobbles

Ore Body Geometry

1.3 – 14

Drill hole

v.fine silty sand

sub-horizontal

31347E

60.3 – 8v.fine silty sand

Laminated med.grained sand

Note extensive interfingering of silts and sands

1.3 – 14

Drill hole

v.fine silty sand

sub-horizontal

31347E

60.3 – 8v.fine silty sand

Laminated med.grained sand

Note extensive interfingering of silts and sands

Ore Body Geometry

Sequencing – Mine Planning

• Life of mine cycle important • Logistical exercise• Dewatering, mining, tailing, infiltration, direct return backfill• Strong focus on scheduling and grade control to ensure maximum recovery• Continuous improvement opportunities sought

Continuous Improvement Opportunities

+300mm oversize rejected from MUP

Oversize crushed to -75mm

-300mm oversize remaining after reprocessingHMC stockpile from the 5,000t processed

Various Dry Mining Process Flows (Iluka operations are primarily dry mining)

657E

Oversize

Simple Mining Unit:• Mobile• Suitable for dunal sands with low

clay and rock• Low M&H cost therefore low cut-

off grade (depending on strip ratio and assemblage)

• Low utilisation as range limited by tramming distance limitations of FEL/Dozer -> need to move at ~100m

Stationary Mining Unit• Design for high energy

beneficiation (high clay and rock) with higher work index

• Autogenous mill / drum scrubber allows for higher HM recoveries

• Higher opex, often used in conjunction with ROM ore pad, and hence double handling

• Scraper mining with/without FEL plant feed

• Truck and Shovel with/without FEL plant feed

Oversize

Concentrator Feed

Concentrator Feed

Secondary Screen

Pri. Screen

Ore Bin and. Feeder

Secondary. Screen

Tertiary. Screen

Autogenous Scrubber

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Key Technical Considerations(for design and operation of mining units)

• Clay Characterisation mineralogy, plasticity, bulk properties and work index influence mining unit configuration

• Oversize Characterisation mineralogy, abundance and distribution contained HM and mineralogical value of HM contained

• Slurry Handling Systems liquefaction demand, pumping system duties and water recovery

• Mobility mass and maneuverability power supply, control and communications pumping system duty range

• Beneficiation recoveries need to approach 100% of HM rock charge recycling into scrubbers to maintain charge water demand, water recovery and behaviour of non-newtonian fluids

• Imperfect design has deleterious effects on margins high fixed cost burden (maintenance, power and labour) unfavourable performance outcomes drive up mining unit costs (low mobile equipment utilisation) performance critical to utilisation of downstream processes which have high fixed cost ratio’s

Quartz Tails

Typical Concentrator Process Flows

Fines Thickener

UCC

Gravity Circuit Feed

Solar Evap Dam

Magnetic Separation

Ilmenite Tails

CD Tank

Tails Dam in mine void

Pre-Concentrator (mob)From Mining

Unit

RHF Stockpile & reclaim

Concentrate

Gravity Circuit

Concentrators• Multiple configurations• Config dependent upon HM

upgrade ratio and mineralogy• Numerous tails handling and

disposal options• High utilisation and high VHM

recovery required for maintaining capital efficiency and minimisingmining costs

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Key Technical Considerations(for design and operation of concentrators)

• Clay Characterisation – thickener design and operation abundance (ratio Clay : Sand) – hydrocyclone circuit and dilution demands process water quality (source and in-process equilibrium) dissolved salts, suspended solids, reagent interaction flocculent response, coagulant demand, consolidation profile (thickener and tails void)

• Heavy Minerals sizing in relation to gangue (quartz) – spiral duty selection and feed presentation concentrator duty (upgrade ratio) range (3% HM to 25% HM feed grade not uncommon) need for pre-concentration – consideration based on ore geography and plant mobility mineralogy - valuable and non-valuable components of HM suite (HM’s ain’t HM’s) release curves – maximum achievable VHM recovery ratios need for magnetic separation – optimising ilmenite transport and treatment cost vs value process water considerations – managing effects on HM surfaces attrition scrubbing circuits – viscosity modifiers and their interactions with flocculent

• Slurry Handling Systems complex multi-components systems often with long pumping distances (up to 10km)

• Imperfect design has deleterious effects on margins recovery (+95%) is the highest driver of NPV, low recoveries drastically effect project economics low product grade adversely effects the performance of downstream mineral separation processes management of water systems can effect downstream surface dependent processes in mineral separation

Mineral Separation Plant(typical feed preparation circuit)

Train 1 Alt. Train

HM Concentrate

Alternative Feed via Rail

Alternative Feed via Road

Salt / Clay Residues

Recovered Water

Washing Filter Belt

Trash ScreenAttrition Scrubbers

Feed Dryer

Feed Bins

Water Clarifier

Reagents

Reagents

Reactor

Paste MixerPre-heater

Rinsing & Neutralisation

Electrostatic Separation Circuit

Typical Mineral Separation and Zircon Finishing Process(options for zircon leach either upstream or downstream of final electrostatic and magnetic finishing)

Wet Gravity Circuit

Electrostatic Separation Circuit

Electrostatic Separation Circuit

Oversize waste

Ilmenite

SiO2/AlSiO5 Tails

Zircon Conc.

ZirconN/Cond

Rutile HyTi

Feed BinsAlt. Train

Ilmenite Mag Sep and Electrostatics

Secondary Ilmenite

ZrSiO4, TiO2, P2O5 Tails

Premium Zircon

Standard Zircon

Zircon Leach (opt config)

Conductors

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Key Technical Considerations(for mineral separation plants and product specifications)

• Surface Preparation – engine room of plant is electrostatics, high dependence upon surface condition Al:Si coatings (either bound or unbound) reduce electrostatic response on all minerals hematite and goethite on zircon – less conductivity differential between zircon and rutile / leucoxene all surface contamination affects product specification limits ( hence saleability) and mineral recovery salts on surface effect atmospheric sensitivity, with managing atmospheric variation is critical process control

• Characterisation of ilmenite magnetic distribution, alteration and intrinsic elemental quality determines the suitability and specifications for sulfate feedstock, chloride feedstock and/or SR conversion highly altered species (leucoxenes) are less recoverable than less altered (primary or secondary ilmenite)

• Mineralogy and Morphology – key recovery driver abundance of non-valuable HM’s determines design duty (upgrade ratio) of each circuit and hence recovery size distribution and irregular shape affects separation efficiency and classification stages required in-process advanced SEM technology employed for characterisation primarily non-chemical processes - Intrinsic quality determines the saleability and recovery of each product

Premium or standard zircon (Al, Ti, U, Th, Fe, sizing) -> market size and pricing HyTi or Rutile specification (% TiO2) plus contaminants (Zr, Sn, Fe U+Th) determines market options intrinsic contaminants in ilmenite effect market options (chloride, sulfate or SR conversion)

Waste Gas System

Typical Synthetic Rutile (Becher) Process(waste gas systems can include power generation turbine)

Ilmenite Coal

AerationAeration

NH4Cl

Reduction Kiln Rotary Cooler

Screening

Mag Separation

Char recycle

Reduced Ilmenite

(TiO2.Fe)

Filtration

Drying

Dust Recovery

Hx

Scrubbers A/Burner

Synthetic Rutile

Oxide Dams

CaSO4.2H2OWaste Dams

CaSO4.2H2OWaste Dams

Neutralisation

Recovered NH4Cl

Natural Gas

Ca(OH)2

Fe3O4

SR

SR

SRAcid Leach

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Key Technical Considerations(for Ilmenite Upgrading via Becher Process)

• Ilmenite Quality TiO2 grade -> drives unit cost of production Fe grade -> iron is the key to the process throughput and hence major unit cost driver (coal and reagents) Al and Si -> affect the degree of sintering, intrinsic contaminants dilute product TiO2

Mn and Mg -> manganese and magnesium determines maximum Fe removal U + Th -> governs marketability -> higher U+Th increases activity of pigment plant waste alteration of ilmenite-> more altered ilmenites are more reducible often chloride ilmenites can be suitable SR feed stock few ilmenite deposits make suitable SR feed stock, ilmenite quality requirements are fundamental to viability sizing affects the suitability of SR for some chlorinators, although advantageous for some to have finer feeds

• Product Specification –> Step change in cost profile often occurs between Standard : Premium : SREP higher TiO2 product increases reagent consumption higher TiO2 limits throughput – more Fe and Mn removal required threshold targets on TiO2 drive technology employed and reagent suite:

Standard grade – leaching ends following aeration, little to no sulfuric acid, neutralisation and dam costs Premium Grade – requires Sulfur addition and high acid demand -> with waste dams and neutralisation SREP – requires flux addition to kiln, high acid demand plus caustic soda

trace contaminants – limit ilmenite suitability and also govern technology employed

Ore Grade Impact on Pigment Processes

TiO2 Pigment Production Process

Chloride Process (55% of Capacity)

Sulphate Process (45% of Capacity)

Ti Feedstock Chlorination

Cl2 +Coke

Distillation

Waste

TiCl4 Oxygenation Finishing

Ti Metal

UniqueMarket~ 10%

Ti Feedstock Acid Digestion

H2SO4

Purification

Waste

TiOHh Calcination FinishingUniqueMarket~ 10%

CommonMarket~ 80%

Sulfate Ilmenite• Chinese• Moma

• Kwale (?)

Titanium Feedstock Market Segmentation

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Titanium Feedstock (TiO2 grade)

Sulfate Slag• QIT Sorel Slag

• Chinese

Chloride Ilmenite• Iluka• Moma• Ukraine• New Players(?)

Leucoxene and HyTi• Iluka• Bemax• Doral• New Players(?)

Chloride Slag• RBM• Namakwa SR Std & Prem

• Iluka• TiWest

UGS• QIT

91% Slag• QMM Rutile/HyTi

• Iluka• SRL

SREP• Iluka

95%85% 90%80%70%60%55%

TiO2Grade

High Grade Chloride

Chloride SlagChloride Ilmenite *

Sulfate Ilmenite Sulfate Slag

Note: Producer examples only (not necessarily exhaustive).* Leucoxene is included with ilmenite as these generally feed the same pigment plants and is a very small part of the chloride market.

Sulfa

teFe

edst

ocks

Chl

orid

eFe

edst

ocks

Chloride Pigment

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Benefits of High Grade Feed

• Increased pigment production chlorinators are usually Cl2 constrained thus maximum production is achieved by converting as much

of the Cl2 in the chlorinator feed as possible to TiCl4 which means a high grade feedstock favoursmaximum production

• Lower Production costs chlorine consumed by the non TiO2 “others” in the feedstock is lost therefore the utilisation of chlorine

on lower grade feeds is lower (= higher cost) than for a higher grade feed neutralisation reagents cost is lower as there is less non-TiO2 waste to neutralise

• Operability higher grade feed generally makes the chlorinator easier to operate as there is less of the

problematic trace elements (e.g. Ca, Mn and Mg) that cause chlorinator operation difficulties (stickiness in the bed and scaling of ducts from higher BP chlorides)

• Reduced amounts of waste to neutralise and send to land fill higher grade ores have low quantities of non TiO2 elements that have to be neutralised and then

carted / stored / disposed

Traditional Feeds

• Chloride ilmenite TiO2 58-62% only DuPont uses this feedstock:

they have deep welling waste disposal which is cheap have Fe(III) Chloride sales revenue from waste (i.e. Edge Moor)

high chlorine consumption which relies on cheap chlorine which is often available in North America (related to the production of caustic for plastics production)

if running on Cl2 limit, constrains pigment production

• Chloride Slag TiO2 85-86% (QMM ≈ 91% TiO2) more Cl2 consumption per TiO2 unit than rutile due to higher trace elements lower energy demand from rutile being reduced if feed unscreened (as in China) then higher chlorinator carry-over losses than rutile

• SR TiO2 85-93% more reactive than rutile and slag due to the porosity porous therefore more reactive -> higher throughput narrow size range makes it very easy to operate chlorinators

• UGS TiO2 95% very clean (it is slag product that is roasted and leached to remove Ca and Mg from sulphate slag) limited supply and expensive to make compared with lower grade chloride slag

• Rutile TiO2 95% industry standard preference -> only 1.15 – 1.20 t per tonne of pigment (least constraints and least waste) limited supply

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Sulphate Pigment

39

Benefits of High Grade Feed

• Increased pigment production no significant difference as higher grade is offset by slower digestion / baking times

• Lower production costs reduced acid consumption as no acid lost to a copperas product scrap Fe is not required as there is no Fe3+ present in the ore (slag) – partly offset by

the cost of oxidants (O2 or NaNO3) for converting Ti3+ to Ti4+

the cost of neutralising chemicals is lower as there is less to neutralise

• Operability no real differences

• Reduced amounts of waste to neutralise and send to land fill higher grade ores have low quantities of non TiO2 elements that have to be

neutralised and disposed of particularly if there is no market for copperas

Traditional Feeds

• Ilmenite TiO2 48-56% high Fe contents consume acid and generate large volumes of waste – can be offset by sales of copperas (FeSO4) presence of Fe3+ requires the addition of scrap Fe to reduce to Fe2+ otherwise pigment is discoloured. Also requires

plant for the copperas precipitation

• Sulphate Slag TiO2 78-84% low Fe means a reduced waste volumes no Fe3+ therefore no reduction stage (no scrap Fe needed) must contain MgO to provide acid soluble TiO2 phases and can be converted into a saleable by-product requires higher acid concentration for digestion which reduces the ability to recycle waste acid from the process which

leads to higher consumption of concentrated (often purchased) acid doesn’t require a copperas precipitation step

• Acid Soluble SR TiO2 85-90% TiO2 low Fe means a reduced waste stream no Fe3+ therefore no scrap reduction stage porous and finer particle size means less grinding required for digestion (power and grinding media savings)

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Feedstock Interchangeability

• Sulfate Plants lower TiO2 ilmenites reduce TiO2 pigment production, prefer +54% TiO2

most plants can treat Sulfate Slag – no by-product credits not all plants can treat ilmenite

• Chloride Plants ilmenite suitable for DuPont USA plants only most operate on a blend of feeds to get +85% TiO2 feed grade those accustomed to high grade feeds (SR and Chloride Slag) become constrained

with lower TiO2 feed natural rutile substitution for SR/UGS/Chloride slag cause reaction rate constraints many have relied on Iluka (⅔ global SR supply) for grade boost with Iluka reducing high grade TiO2 output (⅔ global SR) by almost half and key

competitors being production constrained, demand for high grade TiO2 is strong. modification and/or expansion to maintain capacity with lower grade feeds is expensive with low surety of supply and capital intensive expansion options, high TiO2 feedstock

is needed to maintain or boost output

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Closing Statement

Closing SlideIluka Resources Limited

For further information, contact:Robert PorterGeneral Manager, Investor Relations

robert.porter@iluka.com+61 3 9600 0807 / +61 (0) 407 391 829www.iluka.com