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The Minas-Rio iron ore project in Brazil is expected to produce 26.5 Mtpa of iron ore in its first phase and made good progress during 2011. Minas-Rio secured a number of major licences and permits during the year; the offshore and onshore works at the port are on schedule; more than 90% of land access has been secured along the 525 km pipeline route and more than 200 km of pipeline has been installed; and the civil works at the beneficiation plant are well under way. As with other complex greenfield mining projects, a number of irregular issues, such as the discovery of caves at the beneficiation plant site which require specialist assessment, continue to cause delays to the work scheduling, in addition to outstanding land access and an evolving permitting environment. Minas-Rio is implementing various measures to manage these challenges in a high inflationary Brazilian mining environment, including acceleration activities within the previously announced 15% capital increase, to target first ore on ship in the second half of 2013.

(a) Capital expenditure, post acquisition of Anglo American’s shareholding in Minas-Rio, includes 100% of the mine and pipeline, and an attributable share of the port, as modified by the agreement with LLXSA and LLX Minas-Rio. Capital expenditure is under review to contain the capital increase to approximately 15% of the guidance.

The aim of the Sishen Expansion Project Phase 1B (SEP1B) is to beneficiate the -1+0.2mm fraction of the jig plant ROM feed currently being discarded. The project aims to produce 0.75 Mtpa additional fines product, and has the potential to increase the jig plant yield by about 3%.