Transcript Slide 1

SHERRITT INTERNATIONAL
Ambatovy Nickel Project:
A Progress Report
March 2008
Diversified Natural Resource Company
Metals
 33,000 tonne nickel plus cobalt mining and processing facility in Cuba and refinery
in Canada - 50/50 joint venture between Sherritt and the Cuban state
 40% interest in 60,000 tpa Ambatovy nickel project
 Technology leader in nickel laterite processing and refining
 Positioned to be preeminent low-cost producer ~110,000 tpa in 2012
Coal
 Operates and/or owns nine surface coal mines in Canada
 Produced 40 million tonnes of coal in 2006
 Developing gasification project ~11 billion tonnes of thermal coal reserves
Oil and Gas
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9 commercial fields operating and 5 exploration/development blocks under review
Gross working interest production of ~31,000 boepd
Significant international exploration opportunities
Understanding of complex fold and thrust structure in Cuba
Leading horizontal drilling operator
Power
 Largest independent power producer in Cuba
 Track record of growing the business - 376 MW of installed generating capacity
 Proceeding with 150+ MW expansion in Cuba and reviewing potential opportunities
in Madagascar
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Ambatovy Project Overview
 Sherritt acquired Dynatec’s Ambatovy nickel project in June 2007
 Sherritt will operate and hold a 40% interest
with partners Sumitomo (27.5%) Kores
(27.5%) and SNC-Lavalin (5%)
 Reserve life of 27+ years
 Major project components:
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Mine Site near Moramanga
220 km pipeline to transport ore slurry
Process plant near Toamasina
Supporting infrastructure, including port facilities,
roads, rail lines, tailings dam and power plant
Toamasina
 Refinery design capacity:
Antananarivo
» 60,000 tpa LME Class 1 nickel briquettes
» 5,600 tpa high-grade cobalt
» 190,000 tpa ammonium sulphate
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 Earth works commenced in June 2007,
commissioning to start in 2009, full
production in 2012
MADAGASCAR
Mine Site and Pipeline
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Construction commenced on the 220 km pipeline which
will transport the ore as slurry from the mine to the
process plant
Engineering has completed Hazard and Operability
reviews in nearly all areas
Upgrades to short term
and long term erosion
and sediment controls
ongoing
The Ore Preparation
Plant site civil work is
60% complete
Processing Facility Site
 Upgrading of Port and transportation links to the plant
site underway
 Employee housing being completed for occupancy in early
March
 Over 6,000 people are employed on the project
 Field activities are
progressing at a steady
pace with over 1,500
foundation piles now in
place and concrete work
underway on some
structures
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Environment, Health & Safety and
Corporate Social Responsibility
Environment
 Work continues to survey, salvage and trans-locate species
 Sedimentation and erosion control remains one of the most important
activities
 JEAs (Job Environmental Analysis) have been established, reviewed and applied
 Focus on biodiversity and water management
 Relocation of project affected people is well advanced
Health & Safety
 Over 8 million man-hours worked with no lost time incidents
 1,922 site safety orientations have been held
Corporate Social Responsibility
 Continuation of Special Projects (job and income creation programs, targeting
communities most affected by the Project)
 Ambatovy project recognized by local authorities (a project that is not only
about economics, but also about social aspects)
 Programs are being implemented to fight Malaria
 AM LRDI (Local Resources Development Initiative) is in operation to provide
basic skills training and to help SMEs (small and medium sized enterprises)
provide services to the project
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Summary
With the addition of the Ambatovy project, Sherritt is
positioned to be a pre-eminent nickel producer from laterite
EXPERIENCED
BOARD AND
MANAGEMENT
TEAM
INDUSTRY
LEADER
STRONG
HISTORIC
PERFORMANCE
CONSERVATIVE
FINANCIAL
POSITION AND
POLICIES
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A strong management team with significant operating experience has grown
Sherritt from $677 million in assets in 1995 to approximately $3.8 billion today
Demonstrated a consistent ability to grow the company while exceeding
performance objectives
A track record of implementing strategies that build long-term stakeholder value
Projected to be among the world’s biggest nickel laterite mines in 2013
Among the lowest cost operators in all segments
Set out to double capital assets over the next 5 years
Revenue & EBITDA growth at CAGRs of 12% & 21%, respectively, from 2001 to
2006
A positive cash flow maintained through management of commodity down-cycles
An ongoing focus on the maximization of free cash flow
Low financial leverage with total debt to capitalization of 19%
Total debt to EBITDA of approximately 0.9x
Growth projects evaluated on “bottom of cycle” commodity price economics
This presentation contains forward-looking statements.
These forward-looking statements are not based on
historical facts, but rather on current expectations and
projections about future events. These forward-looking
statements are subject to risks and uncertainties. These
risks and uncertainties could cause actual results to differ
materially from the future results expressed or implied by
the forward-looking statements.
Further information
regarding risks can be found in our continuous reporting
documents such as our annual report and annual
information form.
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