Xstrata Copper North Queensland - Mount Isa Mines · opportunity 43 Non-discrimination policy 43 Labour relations 44 Mount Isa Mines ... and the Townsville port facilities and logistics

Xstrata Copper North Queensland Sustainability Report 2010

2 ChiefExecutive’smessage

4 ChiefOperatingOfficer’s message

7 Targetsandscorecard

13 Scopeofreport

15 OurSustainableDevelopmentStrategy

18 Corporategovernance

21 Ouroperationsandeconomicperformance

29 Workplacehealthandsafety

29 Health and safety

29 Safety performance

30 Occupational health

30 Monitoring programs

31 �Mount�Isa�Mines�copper�operations

35 Ernest�Henry�Mining

38 Townsville�operations

43 Ourpeople

43 Employment

43 Diversity and opportunity

43 Non-discrimination policy

43 Labour relations

44� �Mount�Isa�Mines�copper�operations

48 ErnestHenryMining

53 Townsvilleoperations

57 Sustainablecommunities

57 Stakeholder engagement and consultation

57 Community feedback

58 Corporate Social Involvement program

58 Community grievances

58 Indigenous rights and Aboriginal cultural heritage

58 Mine closure


68� �Ernest�Henry�Mining

74� �Townsville�operations

79 Environmentalperformance

79 Environmental incidents

80 Climate change

80 Energy

82 Water management

82 Biodiversity

82 Emissions

82 Waste and tailings management

84 Product responsibility

84 Copper and sustainable development


96 ErnestHenryMining

104Townsvilleoperations

110Summaryofkeysustainabilitydata

111 GRIindex

IBC Glossary

Contents

Enquiries�and feedbackOur sustainability report is designed to share our progress with you and we welcome your feedback.

Melanie Edgar Manager Corporate Affairs and Community Relations North Queensland Tel: +61 7 4744 2011

Please email your comments to: [email protected] or write to: Community Relations Xstrata Copper Private Mail Bag 6 Mount Isa, Queensland, 4825, Australia

Xstrata�Ethics LineThe Xstrata Ethics Line is a confidential facility operated independently by KPMG. The line provides employees and other stakeholders with a means through which they can report any breaches of Xstrata’s Business Principles, policies or prevailing legislation. A free phone number is provided in every country in which Xstrata has managed operations.

The Ethics Line can be accessed online via www.xstrataethics.com or by calling the following free call phone number within Australia 1800987 310.

About usXstrata Copper is the world’s fourth largest copper producer. In 2010, its attributable mined production of copper contained in cathodes and concentrates reached 913,500 tonnes. It is also one of the world’s largest producers of smelter and refined copper, including from third-party materials.

Headquartered in Brisbane, Australia, Xstrata Copper is one of the commodity business units within the major global diversified mining group, Xstrata plc. Its mining and metallurgical operations and development projects span eight countries: Argentina, Australia, Canada, Chile, Papua New Guinea, Peru, the Philippines and the United States. Its operations and projects are administered through a regional divisional management structure, which ensures that critical decisions are taken close to the related businesses. Xstrata Copper also has a recycling business (Xstrata Recycling) with plants in the United States and offices in Canada and Asia.

Xstrata is a global diversified mining group, listed on the London and Swiss Stock Exchanges. Headquartered in Zug, Switzerland, Xstrata maintains a meaningful position in seven major international commodity markets: copper, coking coal, thermal coal, ferrochrome, nickel, vanadium and zinc with additional exposure to gold, cobalt, lead and silver. The Xstrata Group also comprises a growing platinum group metals business, iron ore projects, recycling facilities and a suite of global technology products, many of which are industry leaders. The Group’s operations and projects span 20 countries.

QUEENSLAND

Townsville

BowenMount� Isa

Cloncurry

Brisbane

Xstrata Copper North QueenslandXstrata Copper’s North Queensland Division is headquartered in Mount Isa and comprises the Mount Isa

Mines copper operations – consisting of the Enterprise and X41 underground copper mines, the copper

concentrator and copper smelter, Ernest Henry Mining open cut copper mine located near Cloncurry,

and the Townsville operations – comprising the copper refinery, and the Townsville port facilities

and logistics (Townsville port operations). The Xstrata Copper North Queensland Division employs

3,931 people (2,887 employees and 1,044 contractors).

Mount�Isa�Mines��copper�operations

Copperore6.1 million tonnes of ore mined at two underground copper mines: Enterprise and X41

Copperinconcentrate158,143 tonnes

Copperinanode214,041 tonnes produced at the smelter

Plants1 concentrator – 7.2 million tonnes per annum capacity 1 copper smelter – 300,000 tonnes per annum capacity

Ernest�Henry�Mining

Copperore15.29 million tonnes of ore mined; 9.84 million tonnes of ore milled on site

Copperinconcentrate74,595 tonnes

Goldinconcentrate91,259 ounces

Townsville�operations

Townsvillecopperrefinery2010throughput

287,001 tonnes of copper cathode

Townsvilleportoperations2010throughput

887,836 tonnes concentrate loaded to ship 692,267 tonnes fertiliser loaded to ship

2010 Production Facts

AUSTrALIA

SUSTAINABILITy REPORT 2010 1

Our commitment to sustainable development remained firm in 2010 and was reflected in the 22 national and regional awards presented to our sites during the year for best practice in this field. It was also pleasing to note that, at the group level, Xstrata retained its position as Mining Sector Leader on the Dow Jones Sustainability Index in 2010/11, for the fourth consecutive year, and was named as the Super Sector Leader for Basic Resources Industries.

As part of the Xstrata Group, the principles of sustainable development are integral to our business model and guide our daily decision-making. We take a systematic approach to setting targets, monitoring performance and reporting, both internally and externally, against our sustainable development policy, standards and targets.

In May, following an annual review of our management policies, we launched an integrated Xstrata Copper Sustainable Development Policy which strengthened our published position on human rights; improved the alignment between the policy objectives of the Xstrata Group, Xstrata Copper and our operations; and simplified our overall sustainable development framework.

Our sustainable development performance was closely monitored and evaluated throughout the year by the Xstrata Copper Sustainable Development Committee and our sites also participated in a combination of internal and external audits to provide assurance against the sustainability standards of Xstrata Copper and those of the Xstrata Group.

Xstrata Copper exceeded many of its safety and health targets for 2010, and registered improvements of 30%, 50% and 33% for its Total Recordable Injury Frequency Rate (TRIFR), Lost Time Injury Frequency Rate (LTIFR) and Disabling Injury Severity Rate (DISR) respectively compared to 2009. Since 2007, following the acquisition of Falconbridge which doubled the size of our organisation, we have achieved significant improvements in injury rates across our operations with our TRIFR, LTIFR and DISR decreasing by 55%, 76% and 66% respectively over this period.

However, despite this overall continuous improvement, we have been deeply saddened during the past year by critical incidents involving fatality or serious injury at our sites. At our Tintaya mine (Peru), Ronald Mamani suffered serious injuries from an electric shock while performing maintenance activities and tragically remains in a coma. More recently, in early 2011, Richard Roy sustained a fatal injury in an underground incident at our Kidd mine (Canada). It is clear that we must re-double our efforts on catastrophic hazard and high hazard activities to eliminate fatalities and serious injuries from our business.

To that end, over the past year we have progressively introduced ‘positive performance indicators’ to monitor our safety performance, including targets for workplace observations of high hazard activities; percentage compliance with site audits of critical risks; and improved tracking of actions and recommendations from incident investigations. This proactive approach builds on our strong culture of incident reporting and further supports our ultimate goal of achieving injury-free, safe work environments.

In the area of environmental management, we met our target of zero significant (Category 3) environmental incidents in 2010 and the increase in our reporting of negligible (Category 1) incidents during the year was a positive reflection of the strong environmental consciousness across our sites.

We recognise the importance of increasing the eco-efficiency of our operations and all sites have targets in place to minimise their impact on the natural environment while improving productivity. In 2010 our sites continued to make good progress towards achieving these targets that include reducing greenhouse gas emissions, energy consumption and fresh water usage and increasing energy efficiency, water recycling and emissions capture and treatment.

Chief Executive’s messageThe strong recovery in global demand for copper in 2010 together with robust copper prices, enabled

Xstrata Copper to finish the year with a solid set of operational and financial results. The business was

well positioned to leverage these favourable economic conditions as a result of the actions taken by

our management teams during 2009 in response to the global financial crisis, including prudent cost

reductions in the context of an unwavering focus on sustainable development and on our growth strategy.

“ Our commitment to sustainable development remained firm in 2010 and was reflected in the 22 national and regional awards presented to our sites during the year for best practice in this field.”

Charlie�Sartain

2 XSTRATA COPPER NORTH QUEENSLAND

Environmental and social impact studies (ESIAs) were also significantly advanced for a number of projects during the year with the Antapaccay ESIA approved by the Peruvian government in July; the Las Bambas ESIA submitted in May; and the Tampakan ESIA completed for submission in 2011. Our El Pachón (Argentina) and Frieda River (Papua New Guinea) projects are scheduled to complete ESIAs in 2011, and the Río Cuervo ESIA, as part of our Energía Austral project, is currently being evaluated by the Chilean authorities.

I am also pleased to report that the major remediation program at the Murdochville and Gaspé sites in Quebec, Canada was completed in late 2010 within the agreed timeframe and well within budget. Mine closure plans are in place at all our operations and the work undertaken by our Canadian division clearly demonstrates that our commitment to our communities and the environment extends well beyond our project and operational phases and into post-closure.

In 2010 we invested over US$32 million in Corporate Social Involvement projects, primarily in the areas of social and community development, education, art and culture and health. These programs were developed in consultation with local communities, and in many cases implemented in partnership with local stakeholder groups. Throughout the year, we continued to engage closely with our communities on a range of issues related to our mining operations. The resettlement agreements reached with the Fuerabamba community at our Las Bambas project and landholders at our Antapaccay project during the year were major achievements and a good reflection of the solid relationships our sites continue to build with our stakeholders through ongoing dialogue.

Following the approvals of the Lomas Bayas II (North Chile) and Ernest Henry Mining underground developments in 2009, a further three major development projects were approved during the year, including the US$1.3 billion expansion to Antamina (Peru) in January; the US$1.47 billion Antapaccay brownfield expansion to the Tintaya mine (Peru) in July; and the US$4.2 billion Las Bambas greenfield project in August. With all these projects now under development we will now progressively see the realisation of our exciting organic growth strategy which will deliver a 50% increase in our production to 1.5 million tonnes per annum by the end of 2014.

As a result of this ambitious expansion program, the total number of full-time hours worked by our own people and contractors will increase by around 50% as we move into 2011. This will bring some significant challenges, particularly in terms of safety, and we remain absolutely committed to ongoing improvements across all areas of sustainable development.

Each year, Xstrata Copper publishes sustainability reports for our managed operations in line with the globally recognised GRI G3 reporting guidelines. These reports disclose our operations’ economic, safety, environmental, and social performance for the year and enable our stakeholders to compare our performance against our annual targets and to track our performance over time. This report is one of 11 Sustainability Reports* published by Xstrata Copper on our sustainable development performance for 2010.

Xstrata Copper also produces a quarterly Sustainability Bulletin that highlights best practice case studies from across our operations. Both the bulletin and our sustainability reports can be accessed via our website www.xstratacopper.com and I encourage you to visit this site regularly for further information on our operations.

I hope that you find this sustainability report, and our other publications, interesting and informative and we look forward to keeping you updated on our progress in the year ahead.

Charlie SartainChief Executive, Xstrata Copper

* excludes Xstrata Copper’s non-managed joint venture operations, Collahuasi and Antamina, that independently publish sustainability reports. These reports can be accessed at www.collahuasi.cl and www.antamina.com respectively.

Top:�Mount�Isa�CityAbove:�Native�Mitchell�grass�on�Ernest�Henry�Mining’s�rehabilitated�south�waste�rock�dumpLeft:�A�haul�truck�at�Ernest�Henry�Mining


Chief Executive’s message

As a key mining operation in Queensland, Xstrata is committed to supporting our state’s communities, and we were pleased to contribute $2 million to the Queensland Premier’s Disaster Relief Appeal to assist Queenslanders to get back on their feet after these events.

Our operations also continued to play an important role in the economy of our region, and we contributed more than $1.3 billion to the Queensland economy in 2010.

Our�sustainable�development�and�operational�performanceOverall, 2010 was a very positive year for the Xstrata Copper North Queensland Division as we continued our commitment to investing in our business, the community and our people. Through sheer hard work, dedication and importantly great teamwork we achieved outstanding results in both our sustainable development practices and operational performance, and a number of key achievements are highlighted here.

Chief Operating Officer’s messageThe beginning of 2011 has been a difficult time for our state and the nation, and many Queenslanders have

been facing tough challenges as they deal with a number of devastating natural disasters – major flooding

occurred across Queensland in December and January and Tropical Cyclone yasi hit Far North Queensland

in February. We are pleased to report that our people and their families remained safe during these events.

Steve�de�Kruijff

Safetyperformanceandrecognition

Although we were not successful in achieving our safety improvement targets for 2010, we continued to improve our safety performance by reducing our total recordable injury frequency rate (TRIFR) by 11% from 2009 to 7.4. Our lost time injury frequency rate (LTIFR) reduced by 22% from 2009 to 0.7 and in May we celebrated achieving in excess of 4.5 million hours lost time injury (LTI) free.

Our Townsville copper refinery was awarded the Innovation Award at the annual Queensland Resources Council’s Safety and Health Conference for its innovative Copper Nodule Catcher system (read more about this innovation in the case study on page 41).

CorporateSocialInvolvement(CSI)

In 2010, we invested more than $1.7 million in our CSI Program, which comprises the Xstrata Community Partnership Program North Queensland (XCPPNQ) and a sponsorship and donations program. Through the XCPPNQ, we provided almost $1.1 million towards community partnerships in the north Queensland communities of Mount Isa, Cloncurry and Townsville.

Through our sponsorship and donations program, we contributed more than $614,000 to community organisations for various community initiatives and events including the Xstrata Mount Isa Rotary Rodeo, the Xstrata Mount Isa Mining Expo, the Townsville Greek Fest and the Ernest Henry Mining Curry Merry Muster Festival.

In addition to these programs, we are also supporting a number of social infrastructure projects in Mount Isa, Townsville and Cloncurry, including the Cloncurry Community Precinct project and the new Mount Isa Dental Health Building. Since 2006, we have contributed over $5.5 million towards the development of a range of social infrastructure projects.

Our CSI programs are very important to us and our north Queensland communities, where residents are seeing real benefits

from the wide range of initiatives that our programs support. It also highlights our commitment to sustainable development through ensuring the communities where we operate are benefiting from our operations both in the short and long term.

Environmentalperformance

We are pleased to report that no significant environmental incidents occurred at our north Queensland copper operations during 2010. We made significant progress with our committed Regulatory Transition studies and implemented a number of key environmental improvements such as the completion and commissioning of the Death Adder Gully stormwater management system at our Mount Isa site, and completion of a new water recycling project (read more about this in our case study on page 95). Xstrata Mount Isa Mines also reported substantial decreases in five of the six emissions compounds to the Federal Government’s National Pollutant Inventory (NPI) for which it was the major contributor for the 2009–10 period (visit www.npi.gov.au to read more about this).

Operationalperformanceandrecognition

During the year, we either met or exceeded the majority of our production targets across the business. At Mount Isa, the copper concentrator delivered an additional 3,000 tonnes of copper through its innovative mill recovery project, while in our copper smelter we successfully completed the smelter rebrick shutdown on schedule with no recordable injuries, which paved the way for the second highest ever half year anode production of 125,000 tonnes. Townsville’s copper refinery also had a year with record production of cathode, 3% up from the previous record year in 2009.

Progress was made on Ernest Henry Mining’s $589 million extension project comprising a shaft underground mine and magnetite processing facility announced at the end of 2009. Despite shaft underground mine project activities being suspended in June


due to the uncertainty created by the Federal Government’s proposed Resource Super Profits Tax (RSPT), activities resumed in July after the Government’s decision to replace the RSPT with a Mineral Resource Rent Tax (MRRT). The first magnetite concentrate was produced at the end of December, taking EHM one step closer to becoming Queensland’s first exporter of magnetite concentrate.

Xstrata’s north Queensland operations won the Minerals and Energy sector Export Award at the Premier of Queensland’s Export Awards and at the Australian Export Awards in recognition of our outstanding export performance in 2010, which saw exports increase by 22% from the previous year.

During the year, Xstrata Mount Isa Mines was also inducted into the Queensland Business Leaders Hall of Fame in recognition of our contribution to the state of Queensland.

Living�safely�with�lead��in�Mount�IsaOur highest priority is the health and safety of our workers, their families, and the communities in which they live. The lead levels in residents of the Mount Isa community continued to be a matter we considered seriously. During the year we worked with the community and other key stakeholders to address this important community health issue.

We are a founding member of the Living with Lead Alliance and through this we continued our focus on improving community awareness of how to live safely in an environment where lead occurs from natural and industrial sources. We continued to provide free, independent and confidential blood lead testing to community members, and we will continue our commitment to this initiative in the future.

In 2010, Queensland Health conducted a second screening program of Mount Isa children in the target age range of one to four years, with the results showing the amount of children recording safe blood lead levels has increased to 95%, up from 89% in 2008.

We also continued our support for the Lead Pathways Study, an independent study with three phases to enable us to better understand potential pathways of lead into the Mount Isa community through land, air and water. Please read more about this in our case study on the Lead Pathways Study on page 93.

Looking�aheadThe economic outlook in 2011 remains good and the copper price and demand from Asia also remains strong. I am optimistic that this will give us the opportunity in 2011 to capitalise on our achievements in 2010 and look for further efficiency improvements.

Some of the challenges and opportunities facing our north Queensland operations in 2011 include:

■■ Driving improvements in our overall health and safety performance

■■ Transitioning from the Mount Isa Mines Limited Agreement Act (MIMLAA) 1985 to the Environmental Protection Act (EPA) 1994

■■ Releasing the results of Stages II (Air) and III (Water) of the Lead Pathways Study

■■ Continuing our commitment to local communities in north Queensland, with an estimated investment of around $1.2 million in our CSI programs

■■ Maintaining our investment in training and apprenticeship programs to ensure a sustainable workforce

■■ Maintaining the strong operating performances we achieved at our Division in 2010

■■ Delivering magnetite concentrate from Ernest Henry Mining near Cloncurry to our Townsville port for export

■■ Commencing head frame construction and the shaft sink for the Ernest Henry Mining underground mine

■■ Successfully transitioning from open-pit to underground operations at Ernest Henry Mining in the second half of the year

■■ Assessing three options for securing long-term energy supply to north west Queensland

■■ Progressing the implementation of our continuous improvement programs

■■ Advancing work on key projects, including the evaluation of future open-cut potential at Mount Isa, the Copperbalt plant and the copper concentrator refurbishment and crude ore stockpile

■■ Focusing on exploration and business development opportunities.

As always, the safety of our workforce will remain a top priority in 2011. We have set ourselves a goal of achieving Zero Harm where we have a safe and healthy workplace, free from injury, to ensure that all our people go home safely at the end of each day.

The Xstrata Copper North Queensland Division publishes a sustainability report each year that seeks to address the material issues that have been raised by local stakeholders as well as those which Xstrata Copper considers essential to achieve our high standards in sustainable development. This report details our performance against our targets and outlines new targets for the coming year.

I trust that you will find this report a valuable source of information not only about the Xstrata Copper North Queensland Division, but also about the sustainable development principles and objectives that guide all of Xstrata Copper’s business activities.

Thank you for your support and we look forward to keeping you updated on our operations.

StevedeKruijffChief Operating Officer, Xstrata Copper North Queensland

Anodes�from�the�Mount�Isa�copper�smelter�make�their�way�to�Xstrata’s�Townsville�copper�refinery�

via�the�Mount�Isa�to�Townsville�rail�corridor


Chief Operating Officer’s message

Members�of�the�Environment�team�check�an�area�that�was�recently�seeded�at�Ernest�Henry�Mining.��The�area�in�the�background�was�rehabilitated�in�previous�years


Targets and scorecardWe strive for continuous improvement in our health and safety, social responsibility and

environmental performance and to share the benefits of our activities locally, so that we

leave behind a positive legacy of stronger, more sustainable communities.

Safety

Operation 2010 Target Performance 2011 Target

XstrataCopperNorthQueenslandDivision

Zero fatalities (0) Zero fatalities

LTIFR < 0.4 (0.7) LTIFR < 0.6

TRIFR < 7 (7.4) TRIFR < 7

DISR < 75 (130.6) DISR < 100

100% of catastrophic hazards identified and risk management plans developed

(100%) 100%

> 90% of high risk safety tasks/actions completed

(90%) > 90% of high risk safety tasks/actions completed

> 80% compliance to mandatory training (87.4%) > 80% compliance to mandatory training

MountIsaMinescopperoperations


LTIFR < 0.4 (0.8) LTIFR < 0.6

TRIFR < 7 (8) TRIFR < 6

DISR < 75 (168.8) DISR < 100

ErnestHenryMining


Zero LTIFR (0.5) Zero LTIFR

TRIFR < 5.8 (5.6) TRIFR < 5.6

DISR < 50 (13.9) DISR < 45

10% minimum number of PASS champions per department

(30%)

Risk Management training S1, S2, S3 100% leadership team

(100%)

100% of Bow-Tie assessments completed Nil scheduled Bow-Ties achieved

> 85% safety training compliance (85%) > 85% safety training compliance

Townsvillecopperrefinery

Zero fatalities (0) 2011 targets are combined for the Townsville operations (copper refinery and port operations). See below.Zero LTIFR (0)

TRIFR < 6 (8.23)

Zero DISR (192)

> 85% safety training compliance (81.2)

Townsvilleportoperations

Zero fatalities (0) 2011 targets are combined for the Townsville operations (copper refinery and port operations). See below.Zero LTIFR (0)

Zero DISR (0)

Zero TRIFR (0)

> 85% safety training compliance (71.1%)

Townsvilleoperations

See above. (Townsville copper refinery and Townsville port operations 2010 targets)

See above. (Townsville copper refinery and Townsville port operations 2010 performance)

Zero fatalities

Zero LTIFR

TRIFR < 6

DISR < 100

> 80% compliance to mandatory training

Achieved Not achieved Action continues into 2011 SUSTAINABILITy REPORT 2010 7

OurPeople

2010 Target Performance 2011 Target


Continue to roll out cultural initiatives Life Styles Inventory (LSI) program workshops and coaching undertaken

Continue to roll out organisational cultural initiatives

Conduct culture surveys of Xstrata Copper employees in 2011

Scheduled for first quarter 2011 Conduct culture surveys of Xstrata Copper employees and conduct feedback sessions

Conduct 40 Leadership Development Program (LDP) workshops

57 LDP and 12 Introduction to Copper North Queensland Leadership workshops conducted

Conduct 40 LDP workshops

Develop and deploy Indigenous Employment Strategy which aims to provide a framework for action in employing Indigenous people and promote greater participation of Indigenous Australians in the mining industry


Maintain apprenticeship intake at ≥ 45; continue to offer school-based apprenticeships and traineeships

50 full-time apprentices commenced in 2010

11 school-based apprentices and five school-based trainees commenced in 2010

Maintain apprenticeship intake at ≥ 50; continue to offer school-based traineeships

Award 15 university scholarships andeight high school bursaries

Awarded 14 university scholarships Awarded 16 high school bursaries

Award 15 university scholarships andeight high school bursaries

Achieved Not achieved Action continues into 2011

Health



> 95% compliance to re-employment health assessments

(99%) > 95% compliance to re-employment health assessments

> 70% compliance to periodic health assessments

(72%) > 70% compliance to periodic health assessments

100% hygiene hazards risk assessed in all departments

(60%)^ 100% hygiene hazards risk assessed in all departments


> 90% compliance to internal blood lead testing

(91%) > 90% compliance to internal blood lead testing

No lead in blood removals over the national limit of 50 micrograms per decilitre

Nil recorded No lead in blood removals over the national limit of 50 micrograms per decilitre

ErnestHenryMining

> 95% compliance to re-employment health assessments

(95%) > 95% compliance to re-employment health assessments


(75%) > 70% compliance to periodic health assessments



(93%) 2011 target has been combined for the Townsville operations (copper refinery and port operations). See below.

Review and update noise maps (100%)



(100%) 2011 target has been combined for the Townsville operations (copper refinery and port operations). See below.

Review and update noise maps (100%)


See above See above > 90% compliance to periodic health assessments

^ Hygiene hazard characterisation commenced in 2010 and will be completed in 2011. All departments are being reviewed through inspection, observation, interview and investigation processes of their local hygiene hazards. These hazards are then risk assessed, which will continue to allow us to systematically target resources to reduce exposure to the hazard.


Targets and scorecard


OurPeople


MountIsaMinescopperoperations(continued)

Continue to offer Graduate and Vacation Program placements in our operations

22 graduates commenced in 2010 76 Vacation Program placements

Continue to offer Graduate and Vacation Program placements in our operations

Continue work experience programs with local schools

107 work experience placements offered

Continue work experience programs with local schools

Continue STEPers Indigenous training and employment program

Four trainees obtained full-time positions and four new trainees appointed

Appoint 15 new indigenous trainees in 2011

Continue to offer National Indigenous Cadetship Support Program (NICS)

One NICS program placement awarded

Undertake advertising campaign to recruit four additional NICS placements

ErnestHenryMining

Award more than one Xstrata bursary of $1,000 each for work experience

Awarded three bursaries, and four other work experience opportunities

Provide two work experience opportunities for local high school students

Maintain > 2% Indigenous recruitment* (2.7%) Maintain > 2% Indigenous recruitment

Recruit > two Indigenous employees into the STEPers Indigenous training and employment program*

Recruited seven Indigenous employees into the 2010 STEPers program, and employed one permanent Indigenous Training Coordinator

Recruit > five Indigenous employees into the STEPers Indigenous training and employment program

Offer one National Indigenous Cadetship Support Program (NICS) place to a local tertiary student*

One NICS program placement awarded, vacation work was also offered to the cadet

Continue with current four year NICS placement and offer vacation work in second year of four year program


Award two school-based bursaries Not achieved Award two school-based bursaries

SocialResponsibility



Select new XCPPNQ partners for 2011–12 Seven new partners selected Select new XCPPNQ partners for 2012–13

Manage existing XCPPNQ partnerships against program outcomes

Partnerships effectively managed Manage new XCPPNQ partnerships against program outcomes

Develop formal community engagement plans for Xstrata Copper’s north Queensland sites

Community engagement plans developed

Implement community engagement plans for Xstrata Copper’s north Queensland sites

Appoint XCPPNQ External Advisory Committee

Target revised. Decision made not to appoint external advisory committee for XCPPNQ due to results from annual surveying of communities directing where funds would best address community needs

Conduct a Community Attitudes Survey in each of our North Queensland sites


Manage existing XCPPNQ partnerships against agreed program outcomes

Partnerships effectively managed Refer to Xstrata Copper North Queensland Division 2011 Target

Launch and implement Indigenous Affairs Strategy

Indigenous Affairs Strategy developed and under review

Launch and implement Indigenous Affairs Strategy

Review cultural awareness training and deployment plan across site

Review of cultural awareness training commenced

Deploy cultural awareness training across site

Implement action plan developed in response to 2009 Community Attitudes Survey

Action plan implemented (refer to pages 57–58)

Continue implementing action plan and complete Community Attitudes Survey in Mount Isa

Hold three Community Information Sessions

Three Community Information Sessions held (March, July and November)

Hold three Community Information Sessions

* These targets were included in the Social Responsibility table in the 2009 Report.




SocialResponsibility


MountIsaMinescopperoperations(continued)

Hold a presentation and surface tour for teachers, emergency services personnel and health professionals new to Mount Isa

100 people attended annual ‘New to Isa’ presentation and surface tour

Hold a presentation and surface tour for teachers, emergency services personnel and health professionals new to Mount Isa

Launch Mount Isa Mines website Website launched in November www.mountisamines.com.au

Launch a freecall 1800 Community Complaints Hotline

Freecall 1800 number launched in November 1800 982 982

Conduct Key Stakeholder 360º Survey Xstrata North Queensland 360° Key Stakeholder Survey conducted in October

Implement action plan developed in response to Xstrata North Queensland 360° Key Stakeholder Survey

ErnestHenryMining

Hold two Community Information Sessions, one Neighbours Day and one Open Day

Two Community Information Sessions held (April and October)

Neighbours Day held in November Open Day held in September

Hold two Community Information Sessions, one Neighbours Day and one Open Day

Continue to promote and support tourism initiatives in Cloncurry

Conducted 13 tours with a total of 205 visitors, in conjunction with Cloncurry Historical Society

Substantial sponsorship towards new rail history display at Mary Kathleen Memorial Park

Continue to promote and support tourism initiatives in Cloncurry


Action plan implemented (refer to page 69)

Refer to Xstrata North Queensland Division 2011 Target

Launch an EHM website Website development commenced in 2010

Launch EHM website

Launch an EHM freecall 1800 Community Information and Complaints Line

Target deferred to 2011 Launch an EHM free call 1800 Community Information and Complaints Line


Conduct a Community Information Session and a Key Stakeholder Forum

One Community Information Session held in May

Key Stakeholder Forum held in September

Conduct a Community InformationSession and a Key Stakeholder Forum

Assess effectiveness of 2010 XCPPNQ partnerships

Partnerships assessed and determined to be effective



Action plan implemented (refer to pages 68–69)


Provide training for Contract Owners Training scheduled for first quarter 2011

Provide training for Contract Owners

Develop Department Action Plan from SD audit results. Achieve targets as set out in Action Plan.

Department Action Plan developed Continue work to achieve targets

Include SD actions from 2009 audit and maintain the policies and procedures incorporating the guiding principles for all contracts and tenders

Department policies and procedures are maintained under the Document Control system with set review dates

Review the Service Level Agreements Service Level Agreements reviewed

Achieve desired corrective actions from Department Action Plan. Maintain internal and external audits to monitor systems and policies

Department action plan developed and maintained and internal and external audits completed as per audit schedule




Environment



Achieve carbon intensity of 2.8 tonnes of carbon equivalents per tonne of contained metal

3.0 Achieve carbon intensity of 2.96 tonnes of carbon equivalents per tonne of contained metal

Achieve energy intensity of 25 gigajoulesper tonne of contained metal

29 gigajoules per tonne of contained metal

Achieve energy intensity of 28.5 gigajoules per tonne of contained metal


Continue progression of Phase 2 Air andPhase 3 Water of Lead Pathways Study

Draft Phase 3 (Water) report of the Lead Pathways Study received

Complete and publish both Phase 2 (Air) and Phase 3 (Water) of the Lead Pathways Study

Xstrata Copper Smelter Emissions Project team to complete feasibility studies

Engineering studies and actions ongoing, work through continuous improvement plan actions

Xstrata Copper Smelter Emissions Project team to continue with high priority actions in continuous improvement plan

Review Air Quality Control Centre operation improvements and processes

Review completed and improvements implemented

Achieve 300 litres of fresh water per tonne of ore milled at the copper concentrator

209 litres of fresh water per tonne of ore milled

Achieve 260 litres of fresh water per tonne of ore milled at the copper concentrator

Average 7.0 megalitres per day of minedewatering into the recycled water circuit

Averaged 7.7 megalitres per day Average 7.0 megalitres per day of minedewatering into the recycled water circuit

ErnestHenryMining

Maintain tailings underflow density at 68% solids

Average underflow density of 71% solids

Maintain tailings underflow density at or above 71% solids

Raw water consumption < 410 litres per tonne of ore treated

373 litres per tonne of ore treated Achieve a 10% reduction in raw water consumption over 2010 use

Re-use > 80% of pit and bore groundwater

49% of pit and bore groundwater reused (refer to Environment section)

Reuse ≥ 80% of pit and bore groundwater

Rehabilitate 25 ha on the waste rock dumps

25.2 ha of waste rock dumps rehabilitated

Rehabilitate 50 ha on the waste rock dumps


Zero Category 2 (minor) and Zero Category 3 (significant)environmental incidents

Two Category 2 (minor) environmental incidents occurred at the copper refinery in 2010 (refer page 104)

Zero Category 3 (significant) environmental incidents

Zero Category 2 (minor) and Zero Category 3 (significant) environmental incidents

Zero non-compliances with licence conditions

Zero non-compliances Zero non-compliances with licence conditions

Zero regulatory actions or fines Zero regulatory actions or fines Zero regulatory actions or fines

Undertake an independent biodiversitystudy of Stuart Creek

Study completed (refer to case study on page 103)








Zero regulatory actions or fines Zero regulatory actions or fines Zero regulatory actions or fines



Shaun�Cislowski�–�Boilermaker,�welds�pipe�in�the�Site�Services�workshop�at�Xstrata�Mount�Isa�Mines


and environmental sustainability of the areas in which we operate.

In addition, it addresses issues considered material by our stakeholders and that have the potential to become material to the long-term success of our business. We are committed to being accountable to our stakeholders, and we describe the ways we engage with and respond to different groups in the Sustainable communities section of this report from page 57.

In preparing this report, we have sought to present a view of our sustainability performance that is accurate, clear and balanced.

In identifying issues or topics that are material to the Xstrata Copper North Queensland Division, we have considered:

■■ feedback on our sustainability performance and reporting from key stakeholders

■■ company-specific issues raised either directly or indirectly by external stakeholders including NGOs, media, governments, communities and investors

■■ specific issues arising from the management of our business

■■ specific issues raised by our employees

■■ industry challenges raised in industry associations and forums

■■ Xstrata plc’s Business Principles and SD Policy and Standards.

■■ Xstrata Copper’s SD Framework, Policies and Standards

■■ indicators and topics outlined in the GRI G3 Guidelines, International Council on Mining and Metals’ principles, and other best practice guidelines and initiatives.

1 www.xstratacopper.com2 Reports can be found in the sustainable development section of our website www.xstratacopper.com3 www.xstrata.com/sustainability

Scope of reportThis report provides comprehensive information about the economic, health, safety,

environmental and social practices and performance of the Xstrata Copper North Queensland

Division (Mount Isa Mines copper operations, Ernest Henry Mining, and the Townsville

operations) from 1 January 2010 to 31 December 2010.

In line with Xstrata Copper’s commitment to transparency and stakeholder engagement, all of its operating divisions and major development projects publish an annual report on their sustainable development (SD) performance.

The report provides a general description of Xstrata Copper’s SD Policy and how this is reflected in the way we manage our business. The full version of this Policy can be found on Xstrata Copper’s website1.

This is the Xstrata Copper North Queensland Division’s seventh Sustainability Report and is one of 11 published this year by Xstrata Copper2.

In 2010 there were no changes in the scope and boundary since the previous report, and there were also no changes in data measurement methods. The Xstrata Group also publishes an annual Sustainability Report which includes an overview of Xstrata Copper’s SD performance. All these reports are available on the Xstrata sustainability website3.

As part of the Xstrata Group, all Xstrata Copper policies are aligned with Xstrata’s SD Policy and 17 SD Standards and its operations and projects are audited annually, either internally or externally, against these standards. The Policy and Standards are published on Xstrata’s sustainability website.

All data and calculations included in this report were obtained through procedures that are regulated and aligned with measurement models provided by Xstrata and also take into account technical protocols for indicators as set out in the Global Reporting Initiative G3 Guidelines.

All monetary values are expressed in Australian Dollars (AUD) unless otherwise stated.

Target audienceThis report provides our stakeholders with information about Xstrata’s SD Policies and practices and our performance at each of our Xstrata Copper operating sites in north Queensland. Our target audience groups include local, state and federal government, intergovernmental bodies, local communities associated with our operations, employees and their families, local contractors, community organisations and non-governmental organisations (NGOs), business partners including suppliers, media, and industry participants.

Changes�to�size,�structure,�ownership�of operationsThere have been no changes to the size, structure, or ownership of the Xstrata Copper North Queensland Division operations in 2010.

report distributionIn order to ensure ready access to this Report, it is available in the following forms:

■■ 1,300 printed copies in English

■■ Online at www.xstratacopper.com

■■ Online at www.xstrata.com/sustainability

■■ Online at www.mountisamines.com.au.

Defining�report contentThis report highlights specific issues that are material to the Xstrata Copper North Queensland Division and are related to the economic, health and safety, community,

GRIapplicationlevel

2002In�Accordance C C+ B B+ A A+

Mandatory Self DeclaredReport

Externally Assured

Report Externally Assured

Report Externally Assured


The�Global�reporting�Initiative (GrI)This report was prepared in accordance with the GRI G3 Guidelines, the world’s most widely used sustainability reporting framework.

On the basis of the G3 indicators presented here, corresponding to different stages of content definition, we consider that this report complies with Application Level A on the scale of A to C established by the GRI G3 Guidelines, including the Mining and Metals Sector Supplement, to reflect the level of information and indicators reported.

A GRI Index showing how the Xstrata Copper North Queensland Division has applied the G3 Guidelines in this report can be found on pages 111 to 112.

Quality assuranceAs part of the external verification of the Xstrata Group’s 2010 Sustainability Report, independent auditors Ernst & young examined the way in which Xstrata compiled its main SD data, figures and/or indicators over the course of the year. The signed assurance statement contains a brief description of this process and is published in Xstrata’s 2010 Sustainability Report which is available on www.xstrata.com.

While this report has not been independently audited, it draws its key sustainability data from the same database as the Group report that is externally assured.

The most recent previous Xstrata Copper North Queensland Division Sustainability Report was published in April 2010, which reported on 2009 sustainability performance.

Prepared�anodes�ready�for�use�in�refining�process�at�Xstrata�Copper’s�Townsville�copper�refinery


Scope of report

Sustainable�Development�StrategyWe operate according to the SD Management Framework established by Xstrata Copper and strive to meet the highest international standards, seeking to balance social, environmental and economic considerations in the management of our business. Similarly, Xstrata Copper’s operations regularly submit to internal and external audits in a bid to ensure compliance with our principles, policies and standards.

Our undertakings are clearly established in our SD Policy, which is reviewed annually to ensure that it is aligned with our objectives. As a result of the review carried out in 2010 Xstrata Copper decided in May to adopt the content of Xstrata plc’s SD Policy in order to bring the Xstrata Copper business unit and its operations more closely into line with the objectives of this policy.

As shown in this report, Xstrata Copper takes a systematic approach to setting targets, monitoring its performance and reporting (both internally and publicly) on all the main aspects of sustainability. Xstrata Copper’s SD Strategy and Management Framework interpret and support its SD Policy and the Xstrata Group’s SD Policy and 17 SD Standards1 and are aligned with our definition of purpose.

Key�challenges�and�opportunitiesXstrata Copper requires all its sites and operations to identify their principal risks. From internal review and feedback from stakeholders, the Xstrata Copper North Queensland Division has identified a number of key challenges that may affect the success of our business and be relevant to our stakeholders now and in the future.

Our Sustainable Development StrategySustainable development (SD) is at the core of our business strategy. Xstrata Copper is firmly committed to

putting SD into practice. It understands that, in order for an organisation to be successful and a valuable

partner to communities where it operates, it must set and comply with ever higher SD standards.

The SD Policy defines and directs our strategies and objectives and is incorporated into the annual Business Planning process. Action Plans are developed, implemented and reviewed annually to ensure that the objectives of the SD policy are being met.

Precautionary�approachXstrata Copper takes a precautionary approach to the environmental management of its global activities. We use a comprehensive risk-based approach to manage the potential detrimental impacts of our activities. This approach means that, even in the absence of evidence that environmental degradation is occurring or will occur, we take action to mitigate the possibility that it will.

1 www.xstrata.com/corporate/commodities/copper/publications

Definition�of�purposeWe will maximise value for shareholders by successfully growing and managing an industry-leading portfolio of copper assets that deliver superior returns.

We will achieve this in a safe, environmentally and socially responsible way, in open partnerships between our people and with communities, governments and other stakeholders.

Our�strategic�objectives■■ Injury-free, safe work environments

■■ Demonstrated leadership in environmental performance

■■ Reputation for social responsibility

■■ Realisation of the full potential of our people

■■ Maximize value from our physical assets

■■ Cost competitiveness through the cycles

■■ Value creation through dynamic growth and continuous improvement

Our�valuesOur decisions and actions will reflect the following values:

■■ Honesty

■■ Dependability

■■ Respect

■■ Confidence

■■ Ingenuity

■■ Courage

■■ Passion


For each prioritised challenge, targets are set to reduce its impact on our operations. Our performance against these targets in 2010 is shown in the scorecard on pages 7 to 11. The scorecard also includes future targets which are set to drive further improvements and address areas of under performance in 2010.

Opportunities identified to make a positive contribution to sustainable development and create value for shareholders include:

■■ continuing improvement of energy and resource efficiency at our north Queensland operations

■■ positively influencing the sustainability performance of the mining industry in Australia through our active participation in forums such as the Minerals Council of Australia, Queensland Resource Council and other industry associations

■■ continuing our commitment to supporting local communities by providing opportunities for employment, using local suppliers and purchasing goods and services from the north Queensland region wherever possible

■■ increasing our interaction with suppliers and contractors through regular Supplier Forums

■■ contributing to the acquisition of skills and improving education to benefit our future and current workforce through workplace and community training and development programs

■■ maintaining community morale in difficult economic times, the need for good communication and the importance of supporting our local communities. We will do this by updating our north Queensland communities on issues important to them through regular community information sessions and forums to ensure residents remain informed of our progress. Feedback will continue to be actively sought from our communities through regular surveys such as the bi-annual Community Attitudes Survey. Read more about our commitment to ensuring sustainable communities and activities undertaken within our communities in 2010 on pages 57 to 77.

Challenges faced by the Xstrata Copper North Queensland Division include:

■■ Regionalgrowthissues

This Includes competition for staff, skills shortages, demand for infrastructure, affordable housing and coping with economic and population growth.

In 2010 we continued to implement our Human Resources Strategy to attract and retain talented people and match employees’ family members with suitable local employers where possible. We continued to work with all levels of government and relevant organisations to address infrastructure needs and improve liveability in our local communities, particularly in the remote and regional communities of Cloncurry and Mount Isa.

■■ ChangestoFederaltaxandroyaltystructure

The Federal Government’s proposed Resource Super Profits Tax (RSPT) resulted in Xstrata suspending its exploration and EHM expansion programs. At EHM, shaft underground mine activities resumed on 2 July 2010 in light of the Federal Government’s decision to replace the RSPT with a Mineral Resource Rent Tax (MRRT).

■■ TransitiontonewenvironmentallegislationatXstrataMountIsa Mines

We continue to operate within our current environmental licensed limits set by the Queensland Government and continue to work with them to implement the upcoming changes to our environmental regulation. In 2010 several studies were progressed to assist us with developing new environmental authority conditions and to ensure we can continue to sustainably manage our operations.

Read more about our transition on page 86.

■■ MountIsatoTownsvillerailcorridor

A key issue affecting our north Queensland operations is the reliability of the Mount Isa to Townsville rail link and the potential impact of increased rail and product movements. In 2010 we continued to work with Queensland Rail and the Queensland Government to address this issue.

■■ TownsvilleOceanTerminaldevelopment

As a major user of the Port of Townsville, and a member of the Townsville Port User’s Group (TPUG), Xstrata Copper seeks to remain active in ensuring that the interests of port users are protected. In 2010 the Port of Townsville and the Queensland Government reached an agreement that will incorporate an Ocean Terminal in the redevelopment of Berth 10 and cancelled plans to include a residential precinct on adjacent reclaimed land.

■■ TownsvillePortbulkloadingfacility

The current wharf supporting the bulk handling shiploader has been in service for almost 100 years and is nearing the end of its serviceable life. Throughout 2010 Xstrata Copper has been working with the Port of Townsville to identify a new berth for this activity. Significant progress has been made in reaching an agreement on relocating from Berth 7 to Berth 8 and formal agreements are expected to be finalised in 2011.

■■ Environmentalandhealthissues

This includes the lead in blood issue and emissions controls in Mount Isa, environmental impacts such as water discharge events at Mount Isa and EHM, and dust emissions at the Townsville port operations.

We continue to undertake a process of continuous environmental improvement to underpin our ongoing commitment to ensure the health, safety and wellbeing of our local communities.

Specifically in Mount Isa, we continued our commitment to the Living with Lead Alliance, partnering with the Queensland Government (Queensland Health and the Department of Environment and Resource Management), the local Member of Parliament, and the Mount Isa City Council to increase awareness and influence behaviour of residents to live safely with lead. We also continued our commitment to the Lead Pathways Study and accessing new technologies through the Smelter Emissions Project.

In Cloncurry we continued our close relationship to our pastoralist neighbours to manage events which can have a potential impact on their land or livestock.


Strategy and governance

term energy supply for our north west Queensland operations.

In 2010 our target was to maintain carbon intensity at 2.8 tonnes CO2-e per tonne contained metal, which we achieved.

Most importantly, we continue to work with the Queensland Government and local councils to bring competitive and efficient energy to the north west Queensland Minerals Province (NWQMP). This is critical to ensuring the ongoing competitiveness of regional businesses and our own industry. Read more about our approach and response to climate change in the Environmental performance section of this report from page 79.

AwardsIn 2010 the Xstrata Copper North Queensland Division received widespread recognition for the positive work its north Queensland operations have undertaken in its sustainable development activities through the following awards and achievements:

■■ Australian Export Award (Minerals and Energy category) – Xstrata Mount Isa Mines. Please refer to the case study on page 24 for more information

At our Townsville port operations we remained focused on ensuring our dust emissions remain within regulatory limits and that our operations focus on dust minimisation strategies as part of our commitment to achieving continuous improvement at our port operations.

■■ Climatechangeandenergy

As a producer and significant consumer of energy, we seek to contribute to the challenge of satisfying north west Queensland’s growing energy needs while reducing carbon emissions. We do this by participating in the Energy Efficiency Opportunity (EEO) program and proactively managing energy efficiency of our operations, reducing direct emissions and investing in capital projects such as the expansion of the Xstrata Power Station.

In 2010 we expanded the Xstrata Power Station with the installation of three additional 3 MW generation units. This upgrade will not provide enough power to address the long-term energy requirements for Xstrata Mount Isa Mines, the community and other mining projects in the NWQMP and we will continue to investigate options for long-

■■ Premier’s Export Award (Minerals and Energy category) – Xstrata Mount Isa Mines

■■ Induction into the Queensland Business Leaders Hall of Fame – Xstrata Mount Isa Mines

■■ Innovation Award – 2010 Queensland Mining Industry Health and Safety Conference – Townsville Copper Refinery

■■ Kerry Brisbane, Electrical Team Leader Xstrata Skills Centre – Tradesperson of the year Award at the Queensland Resources Council’s Resources Awards for Women

■■ Kylie Hughes, Production Engineering Officer Ernest Henry Mining – Highly Commended in the Overall Award category, Queensland Resources Council’s Resources Awards for Women

■■ Ricky O’Donoghue, Boilermaking Apprentice – finalist in the Apprentice of the year category, Queensland Training Awards.

Left:�Loading�fertiliser�at�Townsville�PortTop:�John�(Sparrow)�Harrison�–�Grader�OperatorAbove:�A�Liebherr�996�shovel�loads�material�into�a�haul�truck�in�Ernest�Henry�Mining’s�open�pit�mine


Strategy and governance

This approach is further supported by Xstrata Copper’s SD Policy and Fraud Policy as well as its SD Strategy and Management Framework and its own Common Systems in the areas of health, safety, the environment, risk management and human resources.

XstrataCopper’sSDperformanceismonitoredandevaluatedbytheXstrataCopperSDCommittee,whichmeetsmonthly.ThroughXstrataCopper’sBoardofDirectors,itreportsregularlytotheXstrataExecutive Committee.

Steve de Kruijff, Chief Operating Officer of the Xstrata Copper North Queensland Division, sits on Xstrata Copper’s SD Committee and, in line with the business unit’s devolved management model, is responsible for drawing up, establishing and implementing SD strategies and management systems across the Division.

The Xstrata Copper North Queensland Division has SD committees operating at all of its operations.

1 For further details, see the corporate governance sections of the Xstrata Group’s Annual Report and Sustainability Report on www.xstrata.com.2 The full version of Xstrata Copper’s Fraud Policy is available on www.xstratacopper.com.

Corporate governanceXstrata Copper adheres to the corporate governance standards set out in Xstrata’s Statement of

Business Principles and SD Management Standards1. Xstrata’s Board of Directors establishes and

reviews the Group’s SD Policy globally and its members receive regular reports on key performance

indicators, critical and high-risk incidents and the SD assurance program.

Sustainable�development�assuranceXstrata Copper undertakes a series of internal and external assurance activities to guarantee its compliance with the Xstrata Group’s SD Policy and Standards and to ensure continuous improvement in this field. This process also ensures that SD targets are in place for relevant issues, monitoring systems are robust and reporting is material, accurate and timely.

In 2009, the Xstrata Copper North Queensland Division’s SD Management System was subjected to an external audit. These audits were conducted by four qualified auditors against Xstrata’s 17 SD Standards using internationally recognised criteria. Scored out of 100 points, the Mount Isa Mines copper operations, Ernest Henry Mining and Townsville operations scored 64, 55 and 55 respectively which placed them in the ‘weak’ band of performance. In 2010 our operations identified the actions necessary to address improvement opportunities, and aims to achieve a score of 80 (in the ‘good’ band of performance) by 2012.

Internal risk audits, insurance audits, key Common System audits, regulatory audits and NQ internal risk compliance audits continued to be major activities in 2010. This included but was not limited to contractor management, ICT outsourcing contractor management, port and logistics, purchasing and warehouse management and shafts and winder systems risk control.

The Mount Isa Mines copper operations’ next external third party SD audit is scheduled for 2011. Both Ernest Henry Mining and our Townsville operations have third party SD audits scheduled for 2012.

Ethics�and�transparencyIn line with the Xstrata Group’s Statement of Business Principles, we are committed to managing our business ethically and transparently and seek to work in an open and responsible way, both internally and externally.

Corruption

In accordance with Xstrata’s Business Principles, we do not offer, solicit or accept any form of inducement or bribe. Xstrata’s internal audit function, supported by KPMG, reflects the ethical performance expectations contained in our Statement of Business Principles and covers identified fraud and compliance risks associated with our key business activities.

In addition, Xstrata Copper’s Fraud Policy2 explicitly states that the organisation will not tolerate any incidence of fraud committed by employees or others, either from within or outside the organisation, and will take immediate and serious action against those persons committing a fraud, irrespective of length of service or position. In addition, it highlights the channels available for employees or others to safely and confidentially report non-transparent behaviour that is at odds with ethics and Xstrata’s Business Principles.

There were no incidents of corruption, fraud or unethical behaviour recorded at the Xstrata Copper North Queensland Division in 2010.

XstrataCopper’sSDGovernanceStructure

Divisional Management

Xstrataplc

Xstrata Copper Board

Copper Executive Committee

Xstrata Copper SD Committee

Operations/Projects


Publicpolicyparticipationandpoliticalcontributions

Xstrata’s Business Principles prohibit political contributions of any kind. In line with this policy, the Xstrata Copper North Queensland Division did not provide any financial or in-kind contribution to political parties or individuals in 2010.

Xstrata plays an active role in a number of important international and national industry organisations and multi-stakeholder groups, through membership, funding, provision of expertise and participation in committees and working groups. These include membership of the International Council on Mining and Metals (ICMM) and support for the Extractive Industries Transparency Initiative (EITI).

Similarly, Xstrata Copper plays an active role in organisations that are copper-specific and others that are unique to geographical areas where it is the only Xstrata commodity business in operation. Its global public policy participation commitments include its involvement in the International Copper Association (ICA), which is chaired by Xstrata Copper Chief Executive Charlie Sartain, and the Australia-Latin America Business Council (ALABC).

There were no legal actions for anti-competitive behaviour, anti-trust or monopoly practices at the Xstrata Copper North Queensland Division in 2010.

Human�rightsAs part of the Xstrata Group, we endorse the principles set out in the UN Universal Declaration of Human Rights, the International Labour Organization Conventions and the UN Global Compact.

Xstrata’s SD Standards require Xstrata Copper operations and projects to implement community relations strategies that ensure transparent and honest stakeholder engagement, and respect for cultural heritage, traditions and norms. Appropriate community grievance mechanisms are also set up to protect these rights.

As a mining company with operations in diverse and often remote geographic locations, Xstrata Copper recognises that the primary human rights issues of our business are related to labour, safety and communities. We are committed to protecting the rights of our employees and contractors to work for equal pay, to associate freely, to a safe and healthy work environment, to non-discrimination and fair treatment that respects their legal rights.

The Xstrata Copper North Queensland Division ensures that all of its human resources employees are trained on human rights policies. In 2010, 100% of our security staff undertook training on human rights policies. During the year we also investigated suitable training models for our future needs to remain compliant with our SD commitments and will be implementing ongoing training in 2011.

Childandforcedlabour

As stated in Xstrata’s Business Principles, we support the elimination of all forms of forced or compulsory labour and will not tolerate any form of child or forced labour. All Xstrata operations annually report the age of their youngest employee and contractor and are audited through the internal risk-management audit program.

The Mining and Quarrying Safety and Health Act (1999) and Mining and Quarrying Safety and Health Regulations (2001) stipulate that all employees at our underground operations must be at least 16 years of age or older. In 2010 the age of our youngest employee at the Xstrata Copper North Queensland Division was 17.

Principal�membershipsAs a member of the Minerals Council of Australia (MCA), Xstrata Copper is a signatory to the MCA’s Enduring Value, the Australian Minerals Industry Framework for Sustainable Development. Enduring Value is the centrepiece of the mining industry’s commitment to achieving continual improvement in its environmental, social and economic performance, accountability, and ensuring that it operates in a manner that is attuned to community expectations. The framework aligns with global industry initiatives, such as the International Council on Mining and Metals (ICMM) Sustainable Development Framework Principles and builds on the Australian Minerals Industry Code for Environmental Management.

Xstrata Copper is a member of the:

■■ Queensland Resources Council (QRC)

■■ Minerals Council of Australia (MCA)

■■ Australasian Institute of Mining and Metallurgy (AusIMM)

■■ Mining Industry Skills Centre (MISC)

■■ Skills DMC – National Industry Skills Centre (NISC)

■■ Australian Institute of Occupational Hygienists

■■ Queensland Minerals and Energy Academy (QMEA)

■■ Mount Isa Chamber of Commerce (MICC)

■■ Townsville Chamber of Commerce

■■ Townsville Enterprise Limited (TEL)

■■ Townsville Port Users Group (TPUG)

■■ Mount Isa Tourism Association (MITA)

■■ Living with Lead Alliance.

Xstrata Copper also supports the:

■■ Australian Government Energy Efficiency Opportunities program (EEO)

■■ Annual Queensland Mining Industry Safety and Health Conference

■■ Annual MISC Queensland Training Conference and Awards

■■ MISC regional training group

■■ QMEA steering committee for Indigenous employment

■■ North West Queensland Indigenous Resources Industry Initiative – a collaborative partnership between the QRC, Queensland Government, Minerals Council of Australia and the Australian Government

■■ Southern Gulf Catchments Group in Mount Isa

■■ Mount Isa to Townsville Economic Zone (MITEZ).

Corporate governance

Xstrata�Ethics�lineAt Xstrata Copper, each employee and/or contractor has a responsibility to act ethically and in accordance with Xstrata’s Business Principles.

The Xstrata Ethics Line is a confidential facility, operated independently by KPMG, through which employees and other stakeholders, such as contractors or suppliers, can report any breaches of Xstrata’s Business Principles, policies, or prevailing legislation. A free phone number is provided in every country in which Xstrata has managed operations. The free number within Australia is 1800 987 310. The Ethics Line can also be accessed online via www.xstrataethics.com.

The Xstrata Ethics line is promoted to all Xstrata Copper employees and contracting companies through the distribution of the Xstrata plc Business Principles booklet.


A�haul�truck�at�Ernest�Henry�Mining


The project will enable EHM to achieve annual production levels averaging 50,000 tonnes of copper and 70,000 ounces of gold in concentrates from 2013, once the underground shaft has been commissioned, until 2024. Ore will be mined principally from a major hoisting shaft to be sunk to a depth of 1,000 metres, producing an expected six million tonnes per annum of ore at full capacity.

Significant works were completed during 2010 to progress both the shaft underground and magnetite plant projects. EHM produced its first magnetite concentrate on 31 December 2010 and commissioning continued in the first quarter of 2011. The first train load of magnetite concentrate is expected to leave Cloncurry for Townsville in the second quarter of 2011.

The magnetite processing operation at EHM is expected to produce approximately 1.2 million tonnes of magnetite per annum at full capacity for export to Asia, making EHM Queensland’s first exporter of iron ore concentrate.

Headframe construction for the underground shaft is expected to commence in the first half of 2011 with the shaft sink beginning in the second half of 2011. The headframe is due to be completed in the second half of 2012 with the shaft commissioned in the first half of 2013. Full scale operations will commence after this time. Please refer to the Investing in the future section on page 25 and the case study on page 27 for more information on these projects.

ErnestHenryMining

The Ernest Henry Mining (EHM) copper-gold mine is located 38 kilometres north-east of Cloncurry.

In 2010 over 32 million tonnes of material was mined from the open pit, producing 15.29 million tonnes of copper ore. Ernest Henry Mining produced 74,595 tonnes of copper in concentrate and 91,259 ounces of gold in concentrate in 2010.

Copper concentrate containing gold is trucked to Mount Isa for smelting to anode and the anode is then railed to Townsville for refining to cathode at Xstrata Copper’s Townsville copper refinery.

Metal production increased by 75% at EHM in 2010 due to higher ore grades coming from the pit. Processing of remnant lower-grade surface stockpiles ceased in June 2010 following increased availability of ex-pit ore with the remaining stockpiles to be processed in 2011. Gold in concentrate increased by 92% in 2010 compared to 2009 due to improved feed grades.

EHM’s open pit mining operation is scheduled for completion in August 2011. However, the EHM operation will continue beyond this time following Xstrata Copper’s announcement in December 2009 to invest $589 million to extend the life of the EHM operation to at least 2024 by transforming it from an open pit mining operation to a major underground mining operation with an associated magnetite extraction plant.

The project will create 330 jobs during the construction phase and another 400 jobs from 2013 until 2024. Ore will be trucked out of the underground mine via the underground decline until the hoisting shaft is commissioned in the first quarter of 2013.

Our�operationsThe Xstrata Copper North Queensland Division consists of:

■■ Mount Isa Mines copper operations, and metallurgical operations including the Mount Isa copper concentrator and copper smelter, and administration and services

■■ Ernest Henry Mining open cut copper and gold mine near Cloncurry

■■ Xstrata Copper’s Townsville copper refinery

■■ Townsville port operations.


The Mount Isa Mines copper operations consist of the Enterprise and X41 underground copper mines, a copper concentrator, copper smelter and supporting services. We use state-of-the-art mining and processing technology to produce approximately six million tonnes of copper ore annually from our world-class underground ore bodies.

In 2010 the copper operations produced 6.1 million tonnes of ore, 158,143 tonnes of copper in concentrate, and 214,041 tonnes of copper in anode. The copper concentrator and copper smelter have a 7.2 million and 300,000 tonnes per annum capacity respectively.

Copper concentrate produced at Mount Isa Mines is blended with concentrate received from Xstrata Copper’s Ernest Henry Mining operations before being smelted to copper anodes. The copper anodes are transported by rail to the Townsville copper refinery to be further refined into copper cathodes containing 99.995% pure copper.

Our operations and economic performanceThe Xstrata Copper North Queensland Division continues to generate employment

opportunities, support local businesses, fund community projects and pay government

taxes and charges. We are proud that in doing so, we bring substantial benefits to the

north Queensland communities in which we operate.


■■ $149.9 million spent on rail, power and water charges

■■ over $58 million paid to governments in taxes and charges.

The Mount Isa Mines copper operations contributed to the Queensland economy through:

■■ employment of 2,762 people; including 2,260 employees and 502 contractors

■■ an annual wages bill in excess of $264 million

■■ apprenticeship and youth training opportunities of over $13 million

■■ over $608 million spent purchasing goods and services within Queensland, 30.09% spent with local Mount Isa suppliers

■■ over $1 million paid to the local council for annual rates

■■ annual Corporate Social Involvement contributions of $606,548 directed to community partnerships, donations, sponsorships and community programs

■■ over $100 million in rail, power and water charges

■■ over $37 million paid to governments in taxes, charges and royalties.

Ernest Henry Mining contributed to the Queensland economy through:

■■ employment of 911 people; including 451 employees and 460 contractors


■■ apprenticeship and youth training opportunities in excess of $167,525

■■ $132 million spent on purchasing goods and services within Queensland, 30.09% spent with local suppliers

■■ $496,391 paid to the local council for annual rates

■■ $3.3 million paid to the local council to support local infrastructure, including roads

■■ annual Corporate Social Involvement contributions of $861,897 directed to community partnerships, sponsorships, donations and other community programs

■■ $36.5 million in rail, power and water charges.

■■ over $20 million paid to governments in taxes, charges and royalties.

Markets�and�customersThe Xstrata Copper North Queensland Division serves 16 countries in five markets including Asia, Europe, North America and the United Kingdom.

The Xstrata Copper North Queensland Division’s ore is mined at the Mount Isa Mines and EHM operations. Copper ore mined at EHM is concentrated and road freighted to Mount Isa for smelting. From Mount Isa the copper anodes are transported by road and rail to our Townsville copper refinery where they are refined into copper cathodes. Approximately 20% of our copper cathode production is placed into the Australian domestic market and copper reverts are sold to Canada. The remaining material is exported to markets in Asia including China, Indonesia, Japan, Korea, Malaysia, Singapore, Taiwan, and Thailand.

Direct�economic�contributionDuring 2010 the Xstrata Copper North Queensland Division contributed $1.34 billion to the Queensland economy through:

■■ employment of 3,931 people; including 2,887 employees and 1,044 contractors


■■ apprenticeship and youth training opportunities of over $13 million

■■ over $785 million spent purchasing goods and services within Queensland

■■ approximately $1.81 million paid to local councils for annual rates

■■ annual Corporate Social Involvement contributions of over $1.7 million directed to community partnerships, donations, sponsorships and other community programs


Xstrata Copper’s Townsville copper refinery and port operations form a major part of the Xstrata Copper North Queensland Division. Copper Refineries Pty Ltd refines anode produced at Xstrata’s Mount Isa copper smelter and also anode produced overseas (99.7% pure copper) to copper cathode for domestic and international sales as ISA brand 99.995% pure copper. In 2010 the refinery produced 287,001 tonnes of saleable copper cathode. Copper cathode is sold to customers in Australia and throughout the world including Asia.

Xstrata Technology (XT) has a business unit located at the Townsville copper refinery. More than 1.7 million stainless steel cathode plates have been manufactured and exported to the world since the technology was developed at the Townsville refinery in the mid 1970s. The business recorded approximately $89 million in technology and equipment sales in 2010. The stainless cathode plates are sold to refineries throughout the world using patented XT technology.

The Townsville port operations handle mineral concentrates in and out of port, and fertiliser out of the port. In 2010 our port operations shipped a total of 1.58 million tonnes of product, comprising 887,836 tonnes of concentrate and 692,267 tonnes of fertiliser.

Xstrata concentrates are sold to export markets throughout the world including Spain, India, Thailand, China, Japan and Korea. The port operations also handle significant volumes of third party concentrates and fertiliser for a number of Australian and international clients.

Net�salesInformation on the Xstrata Copper North Queensland Division’s net sales can be found in Xstrata plc’s Annual Report 2010. Please refer to www.xstrata.com/publications/financial.

“ Ore is mined at the Mount Isa Mines and EHM operations ... copper anodes are transported to our Townsville copper refinery where they are refined into copper cathodes. “

Our operations and economic performance


The Townsville operations contributed to the Queensland economy through:

■■ employment of 258 people, including 176 employees and 82 contractors


■■ apprenticeship and youth training opportunities of $16,118

■■ $45 million spent purchasing goods and services within Queensland, 65.5% spent with local suppliers

■■ $316,000 paid to the local council for annual rates

■■ annual Corporate Social Involvement contributions of $244,031 directed to community partnerships, sponsorships, donations and other community programs

■■ $13.4 million in rail, power and water charges

■■ $846,799 paid to governments in taxes and charges.

EconomicContribution2010–XstrataCopperNorthQueensland

Typeofexpenditure Expenditure

Wages bill $334.7 million

Apprenticeship and youth training opportunities $13 million

Purchasing goods and services within Queensland $785 million

Rates to local councils $1.84 million

CSI contributions $1.7 million

Utility charges (rail, power and water) $149.9 million

Government taxes, charges and royalties $58 million

Total $1.3 billion

Local�suppliersThe Xstrata Copper North Queensland Division supports local businesses by consciously sourcing goods and services from local suppliers wherever possible.

Our policy is to source local suppliers who provide value for money and quality. We also assess businesses based on their involvement in community support programs or local social initiatives.

All suppliers and contractors are provided with a copy of Xstrata’s Business Principles and Sustainable Development (SD) Standards so they are aware of our core values and performance expectations.

We recognise the value that can be delivered to the local economy through our activities and wherever possible, encourage the development and use of local suppliers and contractors. We define a local supplier as a supplier from the nearest regional centre with proximity to our mining operations.

Our suppliers include businesses local to our operations as well as large national and international suppliers. We seek to use local suppliers and support these suppliers in enhancing community development opportunities. Through our SD management standards we require our suppliers to identify potential SD risks associated with their operations and minimise any adverse consequences of these risks.

In 2010 the Xstrata Copper North Queensland Division’s combined expenditure on goods and services was around $785 million, which can be grouped into four major categories: utilities, freight and logistics; mining consumables; process consumables and on-site support services.

At the Mount Isa Mines copper operations and EHM more than 30.09% of total goods and services expenditure was with local suppliers. Expenditure on Mount Isa suppliers totalled $182.9 million while we spent $39.7 million on suppliers in Cloncurry.

In 2010 the portion of total goods and services expenditure with local suppliers at the Townsville operations was 65.5%, with an expenditure of $29.5 million.

Infrastructure�for�public�benefitIn 2010 the Mount Isa Mines copper operations entered into a partnership with Queensland Health to contribute $2 million towards the construction of a new Dental Health Building and training centre. This initiative forms part of the Queensland Government’s $65 million redevelopment of the Mount Isa Hospital. Construction of the Dental Health Building commenced in mid-2010 and is due for completion in mid-2011.

In 2010 EHM continued its partnership with the Cloncurry Shire Council, contributing $750,000 over two years (2009 and 2010) towards the Cloncurry Community Precinct project. The project involves the redevelopment of the current Shire Hall and library complex to create a central community hub for Cloncurry. Construction works for the project are expected to commence in 2011. This project is addressing community needs identified in the 2007 and 2009 Community Attitudes Surveys.

The�Ernest�Henry�Mining�open�pit��copper-gold�mine



For Xstrata Mount Isa Mines, receiving the Premier’s Export Award was a welcome recognition of its export achievements, and it was the second time in four years that Xstrata Mount Isa Mines had entered and won the award in this category.

It also meant that Xstrata Mount Isa Mines automatically progressed as a national finalist in the 2010 Australian Export Awards, where they were awarded the 2010 Australian Export Award in the same category for the

22 percent increase in exports in the 2010 financial year to $2.3 billion. Between 2008 and 2010, zinc and copper exports by volume increased by 105% and 20% respectively.

Steve de Kruijff – Chief Operating Officer Xstrata Copper North Queensland, said recognition of Xstrata Mount Isa Mines’ export achievements is a clear acknowledgement of our achievements across all areas of operations and for our employees and stakeholders.

“The award is a testament to the effort and accomplishments being made every day by everyone involved in our operations, with a world class team we run a world class operation and such a feat would not be possible without all of our people,” said Steve.

With a workforce of over 4,000 employees and contractors, Xstrata Mount Isa Mines is a significant contributor to the local economy.

Xstrata Mount Isa Mines is also extremely proud of its sustainable development practices. The company’s commitment to, and achievements in employee and contractor safety, the environment, and to the regional communities supporting the company’s operations are a clear indication for ongoing success.

Case�study

Xstrata Mount Isa Mines wins two Export Awards

It was a year of accolades for Xstrata Mount Isa Mines, winning

awards at both the 2010 Premier of Queensland’s Export Awards

and the 2010 Australian Export Awards in the Minerals and

Energy category.

Pictured�above:�Merv�Sharkey�–�Commercial�Manager,�Mark�roberts�–�General�Manager�refinery,�Port�and�Logistics�and�ross�Thompson�–�Principal�Advisor,�Energy�and�Infrastructure�Xstrata�Copper,�receive�the�Minerals�and�Energy�Award�at�the�2010�Premier�of�Queensland’s�Export�Awards



Majorsuppliers

Utilities, logistics and freight Mining consumables Process consumables On-site support services


■■ Santos■■ CS Energy■■ APA Group■■ ARG/Queensland Rail■■ Toll North■■ Mount Isa Water

■■ Shell■■ Caterpillar■■ Sandvik Tamrock■■ Atlas Copco■■ Komatsu■■ Michelin■■ Bridgestone■■ Dyno Nobel Asia Pacific■■ Growth Asia

■■ Donhad■■ SNF Flowmin■■ Sibelco (Unimin)■■ Coogee Chemicals■■ ANI Bradken■■ Orica Mining Chemicals

■■ Downer Engineering – Engineering Services

■■ Gemini Medical Services■■ Secure Corp – Security Services■■ Cleanaway – Waste Management■■ Huddy’s Mining Services■■ PyBAR■■ Skilled Group Limited■■ Mine Site Technologies Pty Ltd■■ Mine Consultants Australia (MCA)

ErnestHenryMining

■■ CS Energy■■ Toll North■■ North West Queensland

Water

■■ Shell■■ Hasting Deering■■ Orica■■ Sandvik Tamrock■■ Michelin■■ Liebherr

■■ Donhad■■ SNF Flowmin■■ Unimin■■ Growth Asia■■ ANI Bradken

■■ Barminco■■ Downer Engineering – Engineering

Services■■ Sodexho■■ Ausenco■■ Pac-Rim■■ Rutherfurd Group■■ Huddy’s Mining■■ Skilled Group Limited■■ S&N Constructions■■ Walz Constructions■■ AECOM Australia


■■ Tarong Energy■■ Ergon Energy■■ Origin Energy■■ Toll North■■ ARG/Queensland Rail

■■ N/A ■■ Coogee Chemicals■■ Redox Chemicals■■ ITW Packaging■■ Icon Plastics■■ J Blackwood & Sons■■ Shell■■ Silcom■■ CNW Electrical

■■ ICS Electrical■■ Cleanaway■■ Skilled■■ Environmental Asset Services■■ ADM Engineering■■ Ardent Security■■ Eco Lab

Financial�assistance�received�from�governmentThe Mount Isa Mines copper operations received funding from all levels of government to support a range of employment, training and education programs (please refer to page 44 for details). The Townsville operations benefited indirectly from this training funding provided to Mount Isa.

In 2010 the Xstrata Copper North Queensland Division received a government diesel fuel rebate totalling approximately $20 million (Mount Isa Mines copper operations $4.7 million, Ernest Henry Mining $15.4 million and Townsville operations $33,000).

Investing�in�the�futureThe Xstrata Copper North Queensland Division’s capital projects in 2010 totalled $397.7 million, with $210.6 million spent on sustaining projects and $187 million spent on expansionary projects.

Xstrata Copper continues to strengthen its investment in the future of north Queensland through a number of planned projects for 2011, which are outlined below.


Capital projects in 2010 totalled $213.1 million, with $188.8 million spent on sustaining projects and $24.2 million spent on expansionary projects.

By-product opportunities – copperbalt

A pre-feasibility study was completed in 2010 evaluating potential for by-product production of cobalt by reprocessing waste streams from the existing copper concentrator. The study indicated that cobalt production may be viable and a staged feasibility study commenced late in 2010. Piloting of the main process was successfully completed at the end of 2010 as part of the feasibility study and upon confirmation of the business case a feasibility study will commence early 2011. In addition to the cobalt, the proposed plant would extract residual copper from the waste streams.

Copper Starter Pit pre-feasibility study

The Copper Starter Pit pre-feasibility study was completed in 2010. The study concluded that open cut mining to extract copper was not feasible as a stand alone project at this time.

Mount Isa Open Pit concept study

A conceptual study to evaluate the mining of a larger copper, zinc-lead open pit in Mount Isa commenced in 2010. This study aims to

develop a case for a large open pit operation in Mount Isa. If the outcomes outline a successful case for future development, a pre-feasibility study will commence in 2011.

1100 Orebody Halo Caving study

A scoping study for block caving of the 1100 Orebody Halo was completed in 2010. The study identified potential risks in the sustainability of the mining method over the life of the project. The 1100 Orebody Halo is currently under consideration within the Mount Isa Open Pit concept study.

Smelter Emissions Project

The Xstrata Copper Smelter Fugitive Emissions Program continued in 2010 to characterise smelter emissions, identify opportunities to further improve the capture and treatment of emissions, and design and implement operational and engineering controls to realise those opportunities. Performance in 2010 focused on engineering studies and working through continuous improvement plan actions which will continue in 2011.

In 2010 Xstrata Mount Isa Mines invested $8.7 million on design and construction of a number of engineering controls to reduce emissions from the lead and copper smelters. Since mid-2007 Xstrata has invested in excess of $30 million on this project to increase the capture and treatment of emissions from our lead and copper smelters.



ErnestHenryMining

Capital projects in 2010 totalled $169.8 million, with $14.2 million spent on sustaining projects and $155.6 million spent on expansionary projects.

Underground mine and magnetite plant

Significant works were completed during 2010 to progress EHM’s life of mine extension project which involves the construction of a major underground mine together with an associated magnetite extraction plant.

Please refer to the case study on the next page for more information on this project.


Capital projects in 2010 totalled $14.8 million; with $4.4 million spent on sustaining projects at Xstrata Copper’s Townsville copper refinery. At the Townsville port operations, $3.1 million was spent on sustaining projects and $7.2 million on an expansionary project.

Our Townsville port operations continued with dust mitigation throughout 2010 with the Train Wagon Tippler dust suppression project’s detail design completed, and the investigation into Berth 7 outloading equipment. The Train Wagon Tippler design included sizing of an appropriate extraction system and the upgrade of electrical supply systems. Approximately $1 million was invested in the Train Wagon Tippler and Berth 7 outloading system dust suppression projects this year. Future works will continue in the Train Wagon Tippler in 2012, including detailed designs for an extraction system for the concentrate storage sheds.

Significant achievements in 2010 at our Townsville operations include:

■■ The Townsville copper refinery continued with the upgrade of the stormwater drainage and stormwater first flush system. Contracts have been signed for the first stage of these works including the construction of the sediment basin and northern drainage line. The onset of an early wet season and government approval delays has pushed back commencement to the end of the current wet season, around April 2011.

■■ The Townsville port operations completed its Stormwater Quality Improvement Options Study. This study investigated upgrade options to improve the discharged stormwater quality for the Townsville port operations’ site.



Case�study

Life of mine extension project

The project will enable EHM to achieve annual production levels averaging 50,000 tonnes of copper and 70,000 ounces of gold in concentrates from 2013 once the underground shaft has been commissioned until 2024. Ore will be mined principally from a major hoisting shaft to be sunk to a depth of 1,000 metres, producing six million tonnes per annum of ore at full capacity. EHM will produce approximately 1.2 million tonnes of magnetite concentrate per annum at full capacity for export to Asia, making it Queensland’s first iron ore concentrate exporter.

Copper-gold concentrates from EHM will continue to be hauled by purpose-built trucks to Xstrata’s Mount Isa copper smelter, with the anode then railed to Xstrata Copper’s refinery in Townsville, while the magnetite concentrate will be transported by purpose-built trucks to a storage and rail load-out facility near Cloncurry and then railed to Xstrata’s Port facility at Townsville.

Project works for the shaft underground mine commenced in January 2010 however activities were suspended on 3 June 2010 due to the uncertainty created by the Federal Government’s proposed Resource Super Profits Tax (RSPT). Despite the suspension, development works continued for a smaller decline underground mine that had also been considered as part of the project feasibility study. Shaft underground mine activities resumed on 2 July 2010 in light of the Federal Government’s decision to replace the RSPT with a Mineral Resource Rent Tax (MRRT).

Underground development works progressed during 2010 with a focus on key headings for access to the base of the shaft and for ventilation and de-watering systems. More than 11,000 metres of underground development was completed during the year. Works commenced for an escape way system providing a ladderway to the surface from underground, and a refrigeration plant was installed on the surface for improved air quality. Works for a high voltage reticulation system also commenced during the year to provide a new overhead line for the underground power supply.

Headframe construction is expected to commence in the first half of 2011 with the shaft sink beginning in the second half of 2011. The headframe is due to be completed in the second half of 2012 with the shaft commissioned in the first half of 2013, enabling full scale operations from that time.

Steve de Kruijff – Xstrata Copper North Queensland Chief Operating Officer, said EHM’s life of mine extension project will play an important part in sustaining Xstrata’s north Queensland copper operations that make a significant contribution to the local and state economies.

“The project will ensure a sustainable future for our Ernest Henry operations and the continued supply of copper concentrate to our smelter in Mount Isa that in turn supports our refining operations in Townsville,” said Steve.

“It will generate an additional 330 jobs during construction and 400 full-time jobs from 2013.

“In 2010 Xstrata Copper North Queensland contributed around $1.3 billion to the Queensland economy.

“This project will help to further strengthen Queensland’s economy, not only through ongoing employment, but also since Ernest Henry Mining will become Queensland’s first iron ore concentrate exporter,” he said.

Construction of the magnetite plant commenced in July 2010 and EHM produced its first magnetite concentrate on 31 December 2010 as part of the commissioning phase. Commissioning continued in the first quarter of 2011 with exports scheduled to commence from Townsville port in the second quarter of 2011.

Myles Johnston – EHM General Manager, said the magnetite plant is a major part of EHM’s life of mine extension project which will extend the life of the EHM operations to at least 2024.

“I am pleased to report that the magnetite base plant has been delivered safely, on time and within budget, which is a credit to all those involved,” said Myles.

“The shaft underground mine is on budget also and we are looking forward to successfully transitioning from open pit to underground mining during 2011,” he said.

On 3 December 2009, Xstrata Copper announced corporate approval of a $589 million

development to extend the life of Ernest Henry Mining (EHM) through the transformation

of open pit mining operations to a major shaft underground mine with an associated

magnetite extraction plant.

“ The project will generate an additional 330 jobs during construction and 400 full-time jobs from 2013.”

Clockwise�from�top:�The�magnetite�extraction�plant�adjoins�the�copper-gold�concentrator

John�Twomey�–�Magnetite�Project�Manager,�with�the�first�magnetite�concentrate�produced�at�EHM

A�bulk�air�cooler�was�installed�to�improve�air�temperature�and�working�conditions�in�the�underground�mine

A�contractor�installs�concrete�lining�for�ground�support�in�the�underground�shaft��

Ernest�Henry�Mining’s�underground�shaft�collar�and�headframe�foundations



Dominic�Clarke�–�Graduate�Electrical�Engineer,�Xstrata�Mount�Isa�Mines


Workplace health and safetyWe aim to operate a safe workplace that is injury- and fatality-free, and to enhance

the wellbeing of employees, contractors and communities.

Health�and�safetyWe pursue this goal by promoting and sustaining a culture of safety that seeks to promote a positive attitude and awareness of the issues involved. We provide visible leadership and make our management accountable for safety performance and for training employees to improve their safety knowledge, skills, and to make them aware that they have a responsibility to themselves, their family and friends to work and behave safely.

We detect and eliminate or mitigate conditions that pose a potential risk to safety and health in our workplaces and neighbouring communities. We ensure that every task undertaken in our operations has a safe system of work defined and that our people have tools and equipment that are fit for the purpose and well maintained to complete tasks safely and productively. In addition, through screening programs, we monitor our employees’ health, wellbeing and fitness for work.

Xstrata Copper uses a risk-management system to identify, assess and eliminate or control safety risks. When an unsafe condition is detected or a safety incident occurs, it is investigated immediately and the necessary action is taken to eliminate the risks involved. Safety auditing takes place regularly across our business to improve safety standards, practices and performance. Safety initiatives and issues are regularly communicated to all of our people.

Our�challengesEnhancing our risk management strategies in all aspects of our business was a strategic initiative in 2010 with three primary focus areas:

■■ Reduction of high consequence low probability incidents

■■ Reduction of low consequence high probability incidents

■■ Health and hygiene.

To assist in managing these we achieved 99% completion of recording Significant Risks, Catastrophic Hazards and High Hazard Activities in our Risk Registers and 83% completion of Bow-Tie assessments against these. This process ensures risks are clearly identified with critical control and task owners. This data then forms the basis of monthly and quarterly reporting and our risk management plans which are reviewed as part of the annual planning process.

We implemented a series of High Hazard Activity audit and observation checklists to monitor workforce behaviour for at-risk acts and integrated these with enhanced inspection programs.

Occupational Hygiene Committees were established at each of our north Queensland sites. Committee membership included representatives from management, technical experts and the workforce to ensure a consultative and scientific approach to the identification, evaluation and control of hygiene hazards in the workplace. Hygiene hazard characterisation studies also commenced in 2010 (refer Occupational Health section on page 32 for more information).

Safety�performanceThe Xstrata Copper North Queensland Division values the health and safety of our people. Safety performance is tracked using the following measures:

■■ Total Recordable Injury Frequency Rate (TRIFR), which includes all injuries except first aid treatments

■■ Lost Time Injury Frequency Rate (LTIFR)

■■ Disabling Injury Severity Rate (DISR), which records the number of days lost or on restricted duties per million hours worked.

Injuryperformance–XstrataCopperNorthQueensland

0

30

10

25

20

10.0

8.3

7.4

16.0

19.0

Number per million hours worked

2006 2007 20102008 2009

TRIFR

5

15

0.7

0.9

0.7

0.91.5

LTIFR

Disablinginjuryseverityrate†–XstrataCopperNorthQueensland

0

300

100

250

200

123.

8

138.

8

131.

8

112.

6

107.

5

Number per million hours worked

2006 2007 20102008 2009

50

150

† Previously we reported DIFR for 2006. We have now restated to show the DISR results. The Disabling Injury Frequency Rate (DIFR) measures the number of disabling injuries x 1,000,000 divided by the number of hours worked, the Disabling Injury Severity Rate (DISR) measures the number of disabling injury days x 1,000,000 divided by the number of hours worked.


Totalrecordableinjuries*–XstrataCopperNorthQueensland

Nature of injury 2009 2010

Amputation 0 1

Contusions/crush 6 6

Fractures 5 9

Intracranial injury 0 1

Lacerations/abrasions 24 24

Sprains/strains 25 21

Injured body part

Ankle/toes/feet 5 6

Arms/shoulders/elbows 10 9

Face/head 8 2

Hands/fingers/wrist 19 26

Hips/knees/legs 8 2

Spine/back/neck 9 9

Trunk/groin/abdomen 1 5

* This table represents all injuries excluding first aid injuries

Occupationalillnessesbytype–XstrataCopperNorthQueensland

Nature of illness 2009 2010

Musculo-skeletal injury 1 2

Noise-induced hearing loss 9 14

The Xstrata Copper North Queensland Division achieved improvements in safety performance in 2010. Our operations were not successful in achieving our safety improvement targets however we achieved an 11% improvement in the TRIFR, a 22% improvement in our LTIFR, a 5% improvement in our DISR and recorded > 4.5 million hours Lost Time Injury (LTI) free in the first half of 2010. Overall, since 2003, significant improvements have been made in safety performance.

Occupational�healthXstrata Copper values the health and wellbeing of our people and we encourage our employees and their families to maintain a healthy lifestyle. The safety performance, emergency preparation plans, contractor management, and occupational health of each of our north Queensland sites is outlined in the following pages.

Monitoring�programsXstrata Copper invested more than $700,000 on occupational hygiene sampling and analysis at its north Queensland operations in 2010.

To undertake fan maintenance at the Mount Isa site, the fan was rolled out from under the fan shroud to allow maintenance personnel to access the hub and rotor. As there was no dedicated means of access to the fan hub, personnel were exposed to hazards associated with working at heights and near openings and edges, and relied on Personal Protective Equipment to protect them from falls.

In early 2009, investigations commenced to identify how the fan maintenance process could be improved to eliminate the risk of workplace incidents. Following the completion of these investigations, a removable platform complete with edge protection was created. The innovative vent fan access platform requires minimal assembly on the ground and can be installed with a single lift from a crane to cover the opening to allow safe access to the hub. The access platform can also be transported between fan sites due to its ability to be broken down into small sections.

The new access platform was first used during 2010 shutdowns at the Mount Isa Mines copper operations and provided an effective access point for maintenance of the fans. The platform totally eliminates the potential for personnel to fall from height,

and removes the requirement for personnel to wear a harness to prevent a fall during fan maintenance.

In addition, the access platform allows more personnel to access the fan hub. Prior to this improvement, only one person could undertake maintenance on the fans and the implementation of this innovative vent fan access platform allows three to four people to work on the rotor centre at any one time, significantly reducing the time it takes to complete maintenance.

David Schraag – Superintendent MICO Infrastructure Maintenance, said the improvement had improved workplace safety at the Mount Isa Mines copper operations.

“The new access platform means personnel can do this work without the risk of a fall, and with more people able to access the fan hub at one time, it has also reduced the time it takes to do the work,” David said.

The innovation involved an investment of $55,000 by the Mount Isa Mines copper operations, and won the 2009 Xstrata Copper North Queensland Innovation Award.

case�study

Improved safety with new vent fan platformFan maintenance is a common practice throughout the mining industry. At Mount Isa Mines copper operations, scheduled maintenance is required on surface ventilation fans to ensure they are operating at full utilisation.

Pictured�above:�Vent�fans�expel�spent�air�from�the�underground�mining�operations�at�Mount�Isa�Mines

Workplace health and safety


Workplace health and safetyMount Isa Mines copper operations

Our challengesIn 2010 we continued to develop our North Queensland Sustainable Development (SD) Management System. Significant progress has been made in the areas of risk and change, emergency, and health and hygiene management. Ongoing audits and reviews of our procedures ensure they are aligned with internal and external expectations.

During the year we enhanced our training programs and implemented multiple contracts with external registered training organisations for core training requirements. We also improved our data capture and reporting on skills and competency requirements.

As part of our improved emergency management system we upgraded our site access system and implemented new software that will enhance the way we control access to site, linking access to key health and training compliance requirements as a key focus in 2011.

Safety�performanceThe Mount Isa Mines copper operations continued to show improvement in safety performance in 2010. Our operations were not successful in achieving our safety improvement targets, however we achieved a 16% improvement in the TRIFR, a 13% improvement in the LTIFR, and a 4% improvement in the DISR. Significant improvements against all these measures have been achieved since 2003.

The Mount Isa Mines copper operations also analysed the causal factors of lost time, restricted work and medical treatment injuries in 2010. Contusions and lacerations to hands and fingers and musculoskeletal injuries represented the majority of these injuries.

Initiatives implemented in 2010 continued to build on strategies from previous years, including our ergonomics taskforce, pre-employment occupational therapy screens for high risk roles, increased workplace observations and improved incident investigation quality with more focus on the identification of contributing factors and corresponding actions to prevent recurrence.

During the year our Occupational Therapist continued to be involved in serious musculoskeletal incident investigations and we established targets for attendance and completion of the multidisciplinary incident investigation training, a diploma level training course for our safety professionals and key line personnel.

As part of our behavioural-based safety programs, we piloted a Visible Felt Safety Leadership program at our copper concentrator in 2010. This is a people-based safety approach aimed at changing fundamentally the operation’s approach to safety. It involves actively looking out for people and focuses on changing safety behaviour as well as coaching people for a better safety result. The aim of this approach is to create a safety culture built on self-effectiveness, personal control and optimism from each individual. These qualities will increase the willingness of employees to care for their own safety and also the health and safety of their teams. This program will be rolled out to other areas of the Mount Isa Mines copper operations in 2011.

Environment�Department�employees�conducting�a�daily�PASS�meeting



Contractor�managementWith contractors representing 32% of our workforce, we continued to work with contracting firms to assist them in developing their own safety management standards.

Xstrata’s Contractor Portal was enhanced in 2010 with Xstrata-engaged contracting firms being given access to Xstrata’s Business Principles, all site-level sustainable development (SD) documents, commercial terms and released site communications.

This helps improve their understanding of our requirements and also enables them to use the information to build their own systems and safety management standards in line with Xstrata’s SD requirements.

Crisis�and�emergency�preparationTo ensure we are prepared to respond to a range of operational challenges, we enhanced our training on the North Queensland Response and Recovery Manuals which included scenario-based exercises at Xstrata Copper’s north Queensland sites in 2010.

The Mount Isa Mines copper operations participated in the North West Minerals Province Mines Rescue Challenge at Outback at Isa and in total, six teams from mining companies across north west Queensland took part in the challenge.

Challenging and realistic scenarios were created for participants and they were presented with various emergency scenarios. Each team was judged on its proficiency at dealing with the situation. Events are designed to provide scenarios that could happen on or around a mine site and include drills involving road accident rescue, multi-casualty, search and rescue, and vertical rescue, and in 2010 the Queensland Government Emergency Services assisted with the organisation of this challenge. Xstrata Mount Isa Mines’ B Crew won the overall prize for the competition.

Occupational�healthIn 2010 the Health Risk Management and Occupational Hygiene teams formed an alliance to identify and manage common issues. Initially developed to address occupational dermatitis, the Health Hygiene linkage has expanded to include occupational hygiene hazards in the Job Role Criteria and health surveillance programs. The links between health and hygiene have been

broadened to include third party review to validate and strengthen our ongoing health surveillance program to mitigate potential harm through occupational exposures to our workers.

This has allowed a sharing of information between the health and hygiene work groups and utilisation of knowledge and skills within health and injury management, resulting in a strengthened process to identify potential hazards and associated health and hygiene risks with our workers. It has also given us the opportunity to proactively manage and address issues as they are identified.

During the year, our health promotion campaigns continued across our north Queensland operations. Campaigns focused on serious diseases dengue fever and H1N1 and health and support information on obesity, smoking, alcohol and drugs, fatigue, nutrition, men’s and women’s health, mental health, hearing conservation and shift work. The health promotions website was improved and received on average around 560 hits a month.

In 2010 we commenced an Occupational Hygiene characterisation process. The aim was to systematically identify and risk rank all hygiene hazards based on their potential to cause harm. This information has been used to direct resources to control hazards that pose the highest risk.

Left:�Matthew�Salmons�–�WorkPac�employee,�undergoes�a�periodic�blood�lead�test�at�Gemini�Medical�Centre

Above:�Occupational�Therapist�–�Brad�Pritchard,�performs�an�orthopaedic�hip�assessment�during�the�Xstrata�Copper�pre-employment�screening�process



Monitoring�programsPrevention of harm due to hygiene hazard exposure is a key priority for the Mount Isa Mines copper operations. In 2010 we continued our extensive monitoring programs for dust contaminants, Diesel Particulate Matter (DPM), noise, lead, arsenic, radiation, vibration and potable water.

The shift sampling log introduced by Occupational Hygiene during 2009 assisted with analyses of results from the 2010 monitoring program. Log completion is undertaken by each worker participating in the dust and DPM sampling program and records tasks and task location, along with environmental conditions experienced during the sampled shift. The information has enabled us to determine exposure sources which can then be targeted for control.

More than $400,000 was invested on occupational hygiene sampling and analysis at the Mount Isa Mines copper operations in 2010.

Sampling�and�analysis

Potablewater

Potable water is sampled from drinking water sources across the lease to ensure water provided to our workers is safe and adheres to Australian Drinking Water Guidelines. Water samples undergo a range of chemical, physical and biological tests which measure for metals, chlorine, bacteria, pH and turbidity amongst others. An annual sampling program ensures all designated drinking water sites are maintained within safe limits.

Noise

In 2010 a comprehensive noise study was conducted across Xstrata’s north Queensland operations. The aim was to identify and assess all noise sources in a department, then formulate a control strategy focusing on sources that pose the greatest health risk to workers. Noise control plans will be developed and rolled out in 2011.

DustcontaminantsandDieselParticulateMatter(DPM)

Workers participate in personal inhalable and respirable dust monitoring programs in all work areas of our operations to provide representative samples of exposure. Inhalable dust particle size ranges from less than 0.1 to 100 microns and are primarily deposited in the upper respiratory tract. Dust contaminants analysed from inhalable dust samples include lead, arsenic, cadmium,

Occupationalhygienesamplingandanalysis–MountIsaMinescopperoperations

Type of sample collected and analysed 2009 2010

Airborne dust (inhalable, respirable, static and asbestos)† 314 388

Arsenic in urine† 1,290 1,371

Diesel Particulate Matter (DPM)† 39 63

Lead in blood (employees and contractors) 3,898 5,542

Noise† 106 221

Potable water (microbiological and metals)† 547 714

copper and thallium. Respirable dust particles range in size from less that 0.1 to 10 microns which have the potential to travel to the deep reaches of the lungs. Crystalline silica is analysed from respirable dust samples.

DPM exposure continued to be monitored in our underground operations at Xstrata Mount Isa Mines throughout 2010. DPM and dust contaminant exposure to workgroups is risk ranked to enable control strategies for exposure sources to be prioritised, with the goal of reducing worker exposure to as low as reasonably practicable.

Arsenic

At the Mount Isa Mines copper operations, arsenic is potentially most hazardous during the copper smelting process.

A broad range of control strategies were implemented at the Mount Isa copper smelter during 2010. These included engineering and plant design changes, arsenic awareness training, along with the enforcement of a mandatory respirator zone and designated smoking area for primary smelting.

Arsenic exposure continues to be monitored through arsenic in urine analysis and workers showing elevations are placed on a management program. This program has proved effective in reducing workers’ long-term exposure to arsenic.

Occupationalillnessesbytype–MountIsaMinescopperoperations



Musculoskeletal injury 1 2

Lead

An elevated blood lead level at our operations is taken seriously. This is evident in the strict protocols in place to reduce lead exposure to employees in the workplace. Biological and dust monitoring is conducted in accordance with the NOHSC standard and recognised occupational hygiene standards.

In 2010, there were no instances of Xstrata Copper employees exceeding the national medical removal limit. However, in the five-year period from 1998-2002, there were 32† reported instances of National Occupational Health and Safety Commission (NOHSC) elevations. In the current eight-year period from 2003–10 we have had 13† reported instances of NOHSC elevations.

We set our medical removal limit below this standard of 50 micrograms per decilitre (μg/dL). Employees with a blood lead concentration of 40 μg/dL or greater must be removed from the workplace until levels return to below 30 μg/dL. Pregnant employees should not have a blood lead concentration that exceeds the national standard of 10 μg/dL.

All employees at our operations are required to have venous lead in blood tests at frequencies which are determined by the area they work in, previous result, gender and reproductive capacity. This form of biological sampling provides an accurate measure of a worker’s exposure to lead.

A total of 5,542 blood lead samples were taken from our Xstrata Copper employees and contractors during 2010 providing an accurate evidence base in order to manage lead exposure.

“ The Mount Isa Mines copper operations continued to show improvement in safety performance in 2010.”

† These numbers reflect the combined copper and zinc businesses operating at Xstrata Mount Isa Mines.



The practice of bulk density weighing using a manual methodology is common throughout the mining industry. This method requires significant manual handling of core samples and the movement of large quantities of water, exposing personnel to a range of potential workplace hazards.

In 2008, Mount Isa Mines copper operations developed a solution to several critical issues associated with the manual process of bulk density weighing. These issues involved a work environment that required significant manual handling of core samples, often at poor angles, and also required the movement of large quantities of water causing both manual handling and slip hazards.

Secondly, the data recording process was done by hand transfer of weights to a paper sample sheet. The hand written weights were then transferred to a computer spreadsheet and loaded to the computer network, resulting in increased time to complete the work as data was recorded multiple times.

Thirdly, there were data quality issues as the method was repetitive and often prone to error when conducted over the course of a shift, often resulting in data transfer and input errors.

A new bulk density weighing unit was designed to address these issues. This resulted in an integrated work platform with a clear path in and out to handle the core sample volumes being tested on a regular basis; a motorised lift system for

the weighing basket and the water tank to reduce the manual handling issues of lowering samples in and out of the water tank; a pumping system to remove the water from the tanks, and to control the water level in the tank; and a digital scale and laptop computer included in the unit enabling data to be recorded just once and minimising transfer errors.

Xstrata’s Manager, Strategic Mine Planning, Nathan Bullock said the design of a new bulk density weighing unit had provided a number of safety and operational benefits to the Mount Isa Mines copper operations.

“The unit is set up so that there is less handling of core samples and it has eliminated the need for personnel to bend and reach like they used to with the previous method and also reduced the likelihood of muscle strains and repetitive motion injuries,” said Nathan.

Mount Isa Mines Copper Operations invested $31,500 for each unit, and two units were fully operational by early 2009.

Project work undertaken during 2010 has shown the introduction of the bulk density weigh unit has improved the quality of data collected from the stations. Additionally, with an incident and injury free year at the core shed in 2010 the project highlights the benefits of undertaking operational safety improvements in the workplace.

case�study

Bulk density weighing unit At the Mount Isa Mines copper operations, bulk density weighing is conducted to measure the weight in air and in water of diamond drill core to determine its bulk density.

Job�role�Criteria�(JrC)Throughout 2010 the JRC tool has been refined and developed into an interactive web-based resource. The role library grew to over 240 roles across our north Queensland operations and the expansion of the current evidence base to include Thermal Work Limit, Manual Task Risk Matrix, and Whole Body Vibration data. Please refer to the case study on page 55 for an update on the JRC.

Earth�Moving�Equipment�Safety�round�TableSince 2008 we have provided the Earth Moving Equipment Safety Round Table (EMESRT) Underground Hard Rock mining group with input into its vision, purpose, scope and annual action plans.

The group saw developments in 2010 with the four initial design philosophies being broadened to 15. The mining industry utilises communication from EMESRT in relation to design philosophies and reference points for Original Equipment Manufacturers when designing and redesigning existing equipment used in mining operations. This has increased the understanding of and influenced design considerations in the areas of ergonomic equipment design, noise, working at heights, fire, dust, isolation, visibility/collision avoidance, machine stability, guarding, whole of body vibration, controls/displays, tyres, manual handling, and equipment access.

EMESRT now includes representation from major mining companies and equipment providers. Through EMESRT, Xstrata Copper North Queensland continues to work in partnership with Caterpillar and Sandvik and other underground, earthmoving, drilling and surface exploration equipment providers.

The EMESRT forum provides an opportunity for open dialogue aimed at improving our equipment’s usability and reducing the risks inherent with their design.

rachael�Schultz�–�Core�Shed�Technician,�operates�the�Bulk�Density�Unit



Safety�performanceAfter achieving nearly 1.5 million man hours recordable injury free in the first half of the year (a record achievement), EHM recorded a number of Medical Treatment Injuries (MTIs) and one Lost Time Injury (LTI). However, despite the high level of project activity, transitioning to underground mining and a doubling of our workforce, we remained on track and achieved most of our 2010 safety targets. Our TRIFR target of 5.8 was exceeded at 5.6 and our DISR target of 50 was greatly exceeded at 13.9. Despite not achieving our LTIFR target of zero, we recorded a rate of 0.5, an improvement on the result of 0.6 recorded in 2009.

Our leadership commitment to the Safety Culture Journey to Zero Harm remained a focus in 2010 with the first two stages of the program now complete. The next stage is to enhance front-line leadership practices to increase quantity and quality of performance feedback and recognition. In 2011, a Safety Climate Survey will be distributed to all employees to provide a snapshot of attitudes and perceptions about safety and to identify areas for improvement.

Workplace health and safetyErnest Henry Mining

Our�challengesXstrata Copper announced in December 2009 that it would invest $589 million to extend the life of the EHM operation to 2024 through the transformation of open pit mining operations to underground mining and magnetite processing.

The commencement of the associated construction works for these projects created unprecedented levels of contractor activity on site during 2010. Many of these contractors have specialist backgrounds outside of the mining industry, which created a unique challenge for EHM to ensure that all contractors understood and were compliant with site and industry requirements.

The Health, Safety and Training department experienced significant growth in 2010 in response to the considerable changes at EHM, providing ongoing challenges in identifying improvement strategies to maintain a safe and healthy workplace.

The Supervisor Quality Support Tool was developed in 2010 and will be implemented in 2011, providing valuable opportunities for supervisors to identify opportunities to improve their leadership skills. These initiatives will ensure a sustainable, mature safety culture is developed throughout EHM.

Crisis�and�emergency�preparationIn 2010 EHM appointed its first Emergency Management Advisor, providing invaluable leadership and direction for emergency management at our operation. It was a challenging year for the Emergency Response Team (ERT) with declining team numbers due to the workforce transition to underground. Despite this, they continued to improve their skills with Certificate III Occupational Emergency Care and Certificate IV Emergency Medical Technician courses being run on site. This resulted in success when the team attended the North West Minerals Province Mines Rescue Challenge at Outback at Isa and won the Confined Space section.

Nathan�Pollard�–�Mobile�Equipment�Technician,�and�Andrew�Green�–�Fitter�and�Turner�with�Detroit,�respond�to�a�mock�road�accident�rescue�situation�during�Emergency�response�Team�training�at�Ernest�Henry�Mining



Occupationalillnessesbytype–ErnestHenryMining


Noise-induced hearing loss Nil 1

Occupationalhygienesamplingandanalysis–ErnestHenryMining

Type of sample collected and analysed 2009 2010

Airborne dust (inhalable and respirable) 203 115

Diesel Particulate Matter (DPM) 35 36

Noise 85 42

The acquisition of a range of new specialised equipment allows us to respond to the unique challenges presented by the developing shaft underground mine. This includes two Underground Emergency Response light vehicles, BG4 closed circuit breathing apparatus, a new ERT building and other specialist tools.

Contractor�management2010 was a record year for EHM with a large influx of contractors for the construction of the magnetite plant and shaft underground mine in addition to various supporting infrastructure projects. Much effort was made to ensure all contractors were appropriately integrated into the workforce with dedicated induction programs, targeted Safe Work Observations and regular audits.

In addition to the short-term management of project contractors, work commenced on a review of the Health and Safety Management System to ensure there was an effective process for management of contractor systems used on site. The new system incorporates management of Health, Safety, Environment and Community requirements and provides simplified access to information for our contractors.

Occupational�HealthA Fatigue Management Program commenced in 2010 with all foreseeable risks associated with fatigue management requiring a review of current controls and the development of appropriate additional controls. EHM is predominately a fly-in/fly-out (FIFO) operation, with charter and commercial flights from Cairns, Townsville and Brisbane. Around 19% of the workforce (employees and contractors) lives locally, so there are a range of different roster combinations, with the majority working 12 hour days.

One of the biggest fatigue-related risks facing EHM is the issue of commuting prior to, during and following a sequence of shifts. Therefore, fatigue management is incorporated into our Health and Safety Management System and aims to achieve the following outcomes:

■■ Identification of robust strategies and actions for implementation and a plan to sustain the impetus for the long term

■■ Consistent application of fatigue assessment and management strategies, through improved behavioural observations and revamped education programs

■■ The promotion and maintenance of a safe and healthy workforce fulfilling EHM’s Duty of Care principles and requirements.

In December 2010, EHM recruited an on-site Occupational Therapist to provide:

■■ acute services for injury management with the aim of returning workers promptly to pre-injury levels

■■ a more diverse range of services, such as massage, relaxation and other stress-related strategies

■■ education and training, particularly in relation to injury avoidance, and health and wellbeing

■■ after-work programs at the accommodation village e.g. gym, weight loss

■■ ERT fitness programs

■■ workplace assessments and assistance with the hygiene monitoring program.

Monitoring�programsDuring the year we continued the identification of hygiene hazards and implemented the 2010 monitoring and control strategy. Occupational Hygiene monitoring was undertaken for dust, noise and underground Diesel Particulate Matter (DPM).

Noise

Employees participate in personal sampling in each of the operating areas to provide representative samples of exposure to noise. During the year, EHM participated in the North Queensland noise survey, to identify and assess noise sources at EHM. An EHM noise control plan that targets noise sources identified in the survey as posing the greatest health risk to workers will be developed and implemented in 2011.

Airbornedust

Employees participate in routine personal inhalable and respirable dust monitoring programs in each of the operating areas to provide representative samples of exposure.

Inhalable dust samples measure dust particles and the level of other contaminants in the dust, such as lead and arsenic. Personal respirable dust monitoring, which includes monitoring for respirable quartz (silica), measures smaller dust particles which can be inhaled into the deep reaches of the lungs.

DieselParticulateMatter

In 2010 exposure in the underground environment was included in our sampling program. We prioritised controls aimed at limiting the DPM generated from vehicles and ensuring adequate ventilation to exhaust diesel fumes from mine areas. Our goal is to reduce DPM exposure to personnel to as low as reasonably practicable.

Contractors�prepare�to�erect�structural��steelwork�for�Ernest�Henry�Mining’s�magnetite�extraction�plant



We developed the Safety Culture Program at Ernest Henry Mining to enhance our operation’s safety performance and to reinforce leadership commitment to the cultural journey to Zero Harm.

The goal of the program was to influence our workforce’s thinking patterns and to embed a safety culture of performance and accountability into organisational culture. This would ensure sustainable safety success through the projected change and growth phase at EHM as we transform from open pit mining operations to a major shaft underground mine with an associated magnetite extraction plant.

While traditional methods such as policies, procedures, quality tools and education programs were well implemented, safety performance had reached a plateau and we identified the need to reinforce the importance of visible and felt leadership.

Ernest Henry Mining partnered with Conexus Consulting to develop a program to improve safety performance in a way that complemented the existing cultural strategy by focusing on constructive behaviours.

The first part of the program was the delivery of Safety Culture Workshops to the leadership team.

The workshops provided leaders with tangible strategies and skills to enable them to model visible and felt leadership to their crews and foster relationships that are based on trust and credibility. In creating a positive safety culture we are able to challenge current values and beliefs and develop a strong, interdependent safety culture.

The next phase of the program is to enhance front-line leadership practices to increase quantity and quality of performance feedback and recognition. A Safety Climate Survey will be distributed to the workforce in 2011 that will allow us to review the performance of the new program.

A positive safety culture has many benefits beyond workplace safety; it helps to create a safer community, build a solid reputation for corporate social responsibility, attract and retain quality staff as well as reduce losses from incidents and injuries.

Myles Johnston – General Manager Ernest Henry Mining, said that while changes to organisational culture takes time, tangible results are already being seen.

“Even with the sizeable increase in contractors on site with the commencement of project infrastructure works, our safety statistics continue to show improvements,” said Myles.

“We are proud to report that we have achieved close to 1.5 million man hours free of recordable injuries in the first half of the year, a record achievement for EHM.

“The program is also receiving a lot of attention externally, with many of our stakeholders closely following the progress and outcomes of the program as they consider implementing the program at their organisations.

“The success of the program to date highlights our commitment to continual improvement and ensuring our employees and contractors are working in a safe environment through the development of a positive safety culture,” he said.

Program research and scoping commenced in early 2009. Leadership safety culture workshops for managers were rolled out in early 2010, with workshops for supervisors and superintendents scheduled for 2011. Ernest Henry Mining invested $66,700 in the program that will be implemented in four phases over a two year period.

case�study

Safety Culture Program

At Ernest Henry Mining, we aim to operate a safe workplace that is injury- and fatality-free, and to enhance the wellbeing of employees and contractors. We pursue this goal by promoting and sustaining a culture of safety that seeks to embed a positive attitude and awareness of the issues involved.

John�Twomey�–�Magnetite�Project�Manager,�conducts�a�Safe�Work�Observation�with�contractors�working�on�the�magnetite�filter�building,�providing�visible�and�felt�safety�leadership



The review identified that back/neck and eye injuries represented the majority of incidents across the Townsville operations, consistent with findings from a 2009 review for manual handling-based injuries. In particular, we identified an increase in eye injuries at our operations in 2010. An action plan was developed from key recommendations of the review, and these actions will be monitored throughout 2011 to ensure the process of continual improvement.

Monitoring of outstanding incident investigations and actions is ongoing and regularly discussed at managers’ meetings. We recognise that our future safety performance is reflected not only in the quality of our incident investigation and actions arising from these investigations, but ensuring they are addressed in a timely manner.

The Workplace Observation Program continued in 2010 to improve our ability to identify and manage potential hazards at our operations. The behavioural-based program involved all employees and 1,706 workplace observations were completed during the year, with a focus on improving the quality of the observations.

efficiencies as we work to defined common goals and strategies, and work will continue on this in 2011.

Safety�performanceIn 2010 our Townsville port operations achieved its 2010 LTIFR and TRIFR targets of zero. The Townsville copper refinery achieved its LTIFR target of zero, however did not achieve its TRIFR target of <6, recording a TRIFR of 8.23. There were two Restricted Work Injuries (lower back strain and a laceration to the finger) and two Medical Treatment Injuries (laceration to the finger and hairline fracture to the elbow). Full investigations were undertaken for all incidents with a range of corrective actions implemented to prevent a recurrence.

At the Townsville operations, a review was undertaken of the previous two years’ incident investigation data to assess it for both quality and effectiveness. This identified prominent trends, potential health and safety improvement initiatives and ensured efforts and resources are being focused in higher risk areas.

Our�challengesThe key challenge and focus at our Townsville operations in 2010 was improving the high level risk management strategies and systems by identifying all risks and foreseeable emergencies and implementing effective controls. We also focused on managing exposure to occupational hygiene hazards at our operations.

Health�and�safetyIn 2010 we conducted an internal review of our Townsville operations’ risk register. This involved five control verification audits being conducted in March. In 2011 we will conduct internal control verification audits to assess their effectiveness for controlling the risk.

During the year we continued to develop our Occupational Health and Safety Management System and significant progress was made in the areas of risk management and annual sustainable development (SD) planning. Audits and reviews of our operational systems and key procedures ensure they are aligned with the Xstrata North Queensland Common System. Full alignment to the North Queensland system will result in greater

Workplace health and safetyTownsville operations

Townsville�copper�refinery�staff�checking�electrode�alignment



maintaining Personal Protective Equipment, obesity, skin care and sun cancer, alcohol abuse, fatigue, mental health and shift work. These programs were well received by employees. The health promotion campaign will continue in 2011 to promote healthy living to our people.

Periodic health assessments continued in 2010 and employees with more than four years service were required to participate. We achieved our 2010 participation target of > 90%. In addition a number of employees were invited to participate in health management programs to assist them in returning to their normal duties following domestic injury or illness. In consultation with the treating doctors, suitable duties plans were developed to provide them with appropriate tasks.

Health assessments are an important part of our safety and health strategy. These assessments provide us with an indicator of an employee’s level of fitness to perform the tasks they are required to do.

We continued to develop the Job Role Criteria (JRC) tool. All job roles have a detailed description of the requirements, tasks and equipment associated with the job. Please refer to the JRC case study on page 55 for more information.

Monitoring�programsIn 2010 we continued our extensive monitoring programs for dust, arsenic in urine, and lead in blood levels. We invested more than $100,000 on occupational hygiene sampling and analysis during the year, and there were no new occupational illnesses reported at our operations in 2010.

reviewed in 2010 requiring checks to be completed at the start of the cyclone season before the identification of any cyclone threat. All cyclone check sheets were completed by the end of November, and actions arising from the check sheets were assigned to ensure the operations were well prepared for the cyclone season.

Contractor�managementContractors made up 32% of our Townsville operations’ workforce in 2010. Managing contractors and their activities more effectively at our operations remained a key focus of our Safety Management System. Our objective is to ensure that the standards and procedures adopted for engaging contractors are consistent with our Common System Standards.

SKILLED, one of our operations’ contractors, introduced the ‘Take 5’ system of risk management for their workforce on site at the Townsville copper refinery. This initiative was actively promoted and supported by the entire contractor management team, and will continue to be supported in 2011.

Occupational�healthA bi-monthly health promotion campaign continued across our Townsville operations in 2010. The campaign included programs on protecting hearing, working in hot conditions,

During the year we reviewed workplace observation data from the previous two years to assess the observations by location, category, body area of concern and follow up actions. The review identified that observations were being conducted in the most ‘at risk’ areas and that a wide range of tasks were being observed. The results of this review will help us improve workplace observations training and highlight areas of concern, and action plans will be developed in 2011 to implement key recommendations of the review.

In 2010 we continued to engage an Occupational Therapist to provide specialised advice and guidance in the area of manual handling through specific workplace observations. Two observations were undertaken each month where workers were observed performing their normal workplace duties. Discussions then took place regarding manual handling techniques, with both positive work practices and areas for improvement highlighted. This program supports manual handling training to reduce the risk of workers sustaining these types of injuries, and further improvements will be made to the program in 2011.

Crisis�and�emergency�preparationA response and recovery manual is in place at the Townsville operations to ensure that we are prepared to respond to a range of crisis and emergency events. In 2010 further training was conducted in Crisis and Emergency Management and in On Scene Commander. The competency-based training sessions were delivered on site using Xstrata Copper’s new response and recovery training program.

In 2010 evacuation drills were conducted at our Townsville operations. Issues highlighted from these drills were addressed and action plans developed and implemented. This contributed to the success of an evacuation that took place at the Townsville copper refinery in October 2010 following a small fire. The Site Response and Recovery Team was activated and all processes and procedures followed correctly and in a timely manner. Queensland Fire and Rescue Service were engaged following the incident for a formal debrief that identified an efficient site emergency response system.

Cyclones and extreme wind and rain conditions are a seasonal event for the Northern coast of Australia, which can affect our Townsville operations. Cyclone procedures and check sheets for all departments were

“ Our Townsville port operations achieved its 2010 LTIFR and TRIFR targets of zero.”

Trini�McLean�–�Occupational�Hygienist�attaches�a�personal�dust�monitor�to�Steve�Jensen�–�

Electrical Trades�Assistant



Biological and workplace monitoring is conducted in accordance with the National Occupational and Health Safety Commission (NOHSC) standard and recognised international occupational hygiene monitoring standards. The NOHSC medical removal limit is recommended at 50 micrograms per decilitre (μg/dL), though Xstrata has adopted more conservative criteria. Employees with blood-lead concentration levels of 35 μg/dL or greater must be removed from the workplace until concentrations are below 30 μg/dL. Pregnant employees should not have a blood-lead concentration that exceeds the national standard of 10 μg/dL.

All employees at our Townsville operations are required to have venous lead in blood tests at frequencies which are determined by the area they work in, their previous result, gender and reproductive capacity. This form of biological sampling provides an accurate measure of a worker’s exposure to lead. In 2010 there were no instances of people exceeding the national medical removal limit, nor the lower Xstrata criteria of 35 μg/dL.

Stability in the numbers of operators in those workgroups tested for blood lead has seen little variation in test numbers at our copper refinery between 2009 and 2010. A notable increase in test numbers was seen at our port operations, due to new starters being included in testing, and increased monitoring of individuals with slightly elevated results. Increased testing frequency and investigation is undertaken for any persistent elevation in blood lead levels, even while comfortably below the removal level. This proactive approach assists in maintaining compliance within exposure criteria and demonstrates our commitment to controlling lead exposure.

Arsenic

At the Townsville operations, arsenic can be found in all copper process areas, however it is potentially most hazardous during the copper refining process. Comprehensive programs are in place across the Xstrata Copper North Queensland Division to manage and minimise occupational exposure to arsenic and other contaminants.

During 2010 the number of workgroups included in the arsenic monitoring program was expanded to ensure exposure profiles were well determined across our operations. For those workgroups previously sampled intensively, numbers and frequencies were reduced while still maintaining comfortable monitoring of exposure. The overall effect of these changes was a net reduction in sample numbers, but a more comprehensive understanding of arsenic exposures across our operations.

At our port operations arsenic is less of a concern, however exposure potential still exists as it is present in some of the concentrates handled. Previous extensive urinary arsenic monitoring had established a low arsenic uptake profile for port operators and sampling frequency was reduced. In 2010 we decided to review arsenic exposure through urinary arsenic sampling at a three year interval, and this is scheduled for 2011.

Leadmanagement

An elevated blood lead level is a matter Xstrata Copper takes seriously. This is evident in the strict protocols in place to reduce employees’ exposure to lead in the workplace.

Noise

Static noise sampling is performed across our Townsville operations to identify problem work areas. All results are used to assist in the review and implementation of noise reduction strategies which include hearing protection requirements, maintenance schedules, sound proofing options, and influencing plant and equipment selection and design, meeting ‘buy quiet’ principles to reduce the impacts of noise-induced hearing loss.

In 2010 we completed a formal review to update the noise maps for our Townsville operations. The final report from this review is expected in early 2011, and an action plan will be developed from the findings. Audiometry testing continued in 2010 to ensure all noise exposure personnel are tested on a regular basis. There were two claims for work-related hearing loss in 2010.

Airbornedust

Employees are required to participate in a routine program of personal inhalable dust sampling which includes determination of exposure to dust, and metal contaminants such as lead, arsenic, copper, and acid mists. These results provide an indication of exposure levels for the various workgroups, and provide the basis for determining performance against exposure criteria and evaluation of controls.

The occupational hygiene monitoring program is part of a dynamic process to constantly review emerging data trends, and respond in a risk based manner by adjusting sampling targets as necessary. Across our Townsville operations in 2010 a number of workgroups were changed to less frequent sampling regimes while a number of new workgroups were included in the sampling program. A week-long arsenic investigation was conducted at the Townsville copper refinery in 2010. Between changes to sampling programs, and the arsenic investigation sampling, the result was a slight increase in the number of samples collected in 2010.

In addition to the routine monitoring program, non-routine sampling is also undertaken on request and is often used to evaluate exposures in tasks undertaken infrequently or where specific concerns are raised. Static sampling is also undertaken on request and is valuable in monitoring emissions, evaluating contaminant levels at particular locations, and for the evaluation of controls.

Occupationalhygienesamplingandanalysis*–Townsvilleoperations

Type of sample collected and analysed

Townsville copper refinery

Townsville port operations

2009 2010 2009 2010

Acid mist 24 24 n/a n/a

Airborne dust (inhalable and asbestos)* 27 76 22 28

Arsenic in urine* 1,101 540 0 0

Lead in blood 48 40 30 59

* Please see the Monitoring programs section for details regarding the sampling frequency for airborne dust and arsenic in urine

OccupationalIllnessesbytype–Townsvilleoperations





The Cathode Nodule Catcher is installed in the cathode stripping machine wash water system. The nodules are collected in the catcher using gravity separation and water flow redirection that causes the solid nodules to drop out of the water flow, being deposited into the nodule catcher’s removable lower chamber. This reduces the amount of manual cleaning required in the wash chamber itself, which used to take place in cramped areas and in very warm and humid conditions as the wash water temperature was maintained at 85 degrees Celsius.

“This innovation has provided a cleaner system and has reduced the requirement for employees to enter the wash station from weekly for up to 1.5 hours, to once every two weeks for around 10 minutes,” said Noel Kimlin – Superintendent Continuous Improvement for Xstrata Copper’s Townsville copper refinery.

“Simply put, the operators can now remove the nodules by removing the catcher’s lower chamber and exchanging it for an empty one.

“The manual handling risks have reduced significantly, along with the risks associated with working in hot conditions, and this is thanks to this new system that virtually cleans the wash station by gravity,” Noel said.

Steve de Kruijff – Chief Operating Officer Xstrata Copper North Queensland, said ensuring the health and safety of our employees and contractors in the workplace is of primary importance to Xstrata Copper.

“Zero harm is our goal and we believe that all work-related incidents, illnesses and injuries are preventable.”

“Our focus on an injury-free, healthy work environment is driving further improvements in our safety performance. It is encouraging to see our employees leading the way in designing innovations that ensure we improve our safety standards,” Steve said.

Case study

Townsville copper refinery wins 2010 Innovation Award

The Townsville copper refinery proudly accepted the Innovation Award at the 2010 Queensland Mining Industry Health and Safety Conference for its unique Cathode Nodule Catcher innovation, which was nominated for its innovative means of collecting copper nodules.

Left:�The�award�winning�nodule�catcher�innovation



Bernard�Paul�–�Mine�Surveyor,�Mount�Isa�Mines�copper�operations


Our peopleWe maintain a safe working environment based on mutual respect, equity and integrity.

Our strategic objective is to realise the full potential of our employees.

In line with Xstrata Copper’s SD Policy, we value diversity and treat all our employees and contractors fairly, offering equality of opportunity at all levels of the organisation, without prejudice of any type. We hire according to the skills and experience required for each particular position, without discrimination based on gender, race, age, sexual orientation, religion, nationality or any other factor. At the Xstrata Copper North Queensland Division, salaries are negotiated based on qualifications and experience, and are the same regardless of gender. Entry level wages are higher than the Australian minimum wage and again, are the same regardless of gender.

The commitment and capability of our people is key to the ongoing success and sustainability of the Xstrata Copper North Queensland Division. Our Human Resources (HR) strategy, and accompanying initiatives, supports this requirement by developing individual capabilities and a constructive organisational culture.

EmploymentIn 2010, the Division provided jobs for 3,931 people (2,887 employees and 1,044 contractors). Our rate of voluntary employee turnover in 2010 averaged 13.5%, which is below the average voluntary turnover rate of 20.9% reported by Queensland participants in the Resources Industry Turnover Analysis.

Employinglocally

We are committed to employing local residents from the communities in which we operate. A significant majority of our workforce is employed on a permanent basis.

We estimate that approximately 60.6% of our total employees in north Queensland, excluding contractors, were hired from the local communities of Mount Isa, Cloncurry and Townsville.

However, the growth in the resources sector in 2010 coupled with the national skills shortage has meant a small number of employees with management and professional skills were recruited from outside Australia.

In 2010, 54.1% of our employees were covered by collective agreements and each employee spent an average of 138 hours in training.

Training�and�educationWe provide our people with exciting career opportunities, and training and development is embedded in our culture. Development opportunities are discussed with employees in annual performance reviews.

We work closely with community stakeholders to provide real and meaningful vocational career pathways for individuals, in careers that reflect the needs of our business. Initiatives are outlined throughout this section.

Diversity�and�opportunityWe seek to foster a culture in which our employee-related decisions, whether it be employment, training or promotion, are taken based solely on an individual’s ability and contribution to Xstrata’s success, irrespective of gender, age, race, disability, sexual orientation or any other aspect of their identity. Of the Division’s total workforce, 14.6% are female and 85.4% are male; total workforce by age demographic shows 30% are under 30, 53% are 30 to 50 and 17% are over 50. Approximately 8.57% identify as Aboriginal or Torres Strait Islander.

Non-discrimination�policyAs stated in Xstrata’s Business Principles, we value the contribution made by our employees and, under our SD Policy, do not tolerate any form of discrimination, abuse of power, harassment or physical or verbal violence in the workplace. We also provide employees with a fair and non-discriminatory mechanism for complaints and foster practices that respect their rights and personal dignity.

In 2010, 20 incidents of bullying, harassment and/or discrimination were reported across the Xstrata Copper North Queensland Division. Of these reported incidents, 75% have been resolved and are now closed off to the satisfaction of the employee. Six of the incidents were found to have no case. Two of the 20 complainants have exercised their discretion to refer to external bodies.

Labour�relationsFour Union Collective Agreements were negotiated or implemented in 2010: Copper Refineries Pty Ltd Collective Agreement, Services Area Collective Agreement, Mining Area Collective Agreement and the Metallurgical Plants Area Collective Agreement. The Health and Safety topics covered in those formal agreements with trade unions include: flexible working practices where individuals work to their capacities, subject to being safe, legal and competent; reasonable rest breaks between shifts; introduction of new rosters that must be preceded by consultation and satisfy health and safety requirements, as well as clauses relating to personal protective equipment.

Within Xstrata Copper there are examples of various workplace relations models, including individual agreements and collective bargaining agreements, as per the Fair Work Act 2009.

All employees are free to join a union of their choice. Labour relations are a fundamental responsibility of operational management and we seek to have a direct relationship between our employees and line management founded on quality leadership, effective communication, mutual respect and trust.

We consult with employees in advance of any significant operational change. Minimum notice periods vary across our operations and are generally specified in collective agreements.


Our peopleMount Isa Mines copper operations

EmploymentIn 2010, the Mount Isa Mines copper operations provided jobs for 2,762 people (2,260 employees and 502 contractors). Our rate of voluntary employee turnover in 2010 averaged 17.7%, similar to the average voluntary turnover rate of 17.6% reported by Queensland participants in the Resources Industry Turnover Analysis.

Benefits provided to permanent employees at the Mount Isa Mines copper operations that are not provided to casual employees include paid leave provisions, external/tertiary education assistance, higher rates of superannuation, disability cover, and salary continuance.

The majority of our employees (99.8%) belong to accumulation style (defined contribution) superannuation funds. A small number belong to a defined benefit fund, which is held and maintained separately from Xstrata’s resources. Assets in the fund are currently greater than the vested benefits of the members. Benefits are payable based on the member’s final salary and the number of years of service with the company.

Employinglocally

As part of our ongoing business strategy, we are committed to employing Mount Isa residents. The significant majority of the Mount Isa Mines copper workforce is employed on a permanent basis. However, the continuing skills shortage in core mining occupations has meant a small number of employees were recruited from

outside Australia. In 2010, 1.2% (35) of our employees (excluding contractors) were foreign nationals who did not have permanent residence in Australia.

All our employees live locally in Mount Isa. For this reason, the Mount Isa Mines copper operations have not previously recorded the proportion of the workforce and senior management hired from the local community. We estimate that in 2010 approximately 66% (1,492) of our total employees (excluding contractors) were hired from the local community.

Financial�assistanceIn 2010, our Mount Isa Mines copper operations received $311,544 from the Mining Industry Skills Centre for the delivery of nationally accredited competencies. We also received $406,393 from the Queensland Apprenticeship Services to support our apprenticeship program, $64,020 from Construction Skills Queensland for retaining apprentices who are linked to the construction industry, and $199,317 from the Mount Isa Institute of TAFE for training first year apprentices.

Employmentprofile*–MountIsaMinescopperoperations

*�Based�on�total�employees�(including�contractors)

54%� Employees�–Mount�Isa

18%� Contractors

27%� Employees�–� rest�of�Australia

1%� Foreign�nationals

Daniel�Jacobs�–�Apprentice�Diesel�Fitter,�and�Troy�Cleary�–�Apprentice�Auto�Electrician,�in�the�Enterprise�underground�copper�mine

Our people


Labour�relationsIn 2010, 1,413 employees (64.7%) in the Mount Isa Mines copper operations were covered by collective agreements.

Our Mount Isa SD Workforce Committees comprised 73% employees and 27% management, which included line supervisors, superintendents and managers.

Training�and�educationTo ensure our employees have the appropriate levels of safety and health competency to perform their work activities and in line with our commitment to developing our people, we invested $9.7 million on training locally during 2010 with an average of $4,460 per employee.

Training Coordinators work closely with line management and supervisory staff to identify training requirements and gaps in knowledge. In 2010 all of our employees completed an annual performance evaluation review where training opportunities were identified as part of their professional development.

Our award-winning training systems continued to focus on delivering competency-based training for all workers. Training requirements identified during career planning, and leadership and professional development also formed part of the process.

Buildingleadership

Our 2010 Leadership Development Program attracted 432 participants in Mount Isa.

The program aims to articulate the role of a leader within the business and provide participants with the required skills. Modules included Introduction to Copper North Queensland Leadership, which provides context around the organisational cultural change initiatives underway across the business, as well as modules focusing on leadership, coaching for performance, planning and communication.

XstrataApprenticeshipProgram

Xstrata Mount Isa Mines runs the largest apprenticeship program in north Queensland, with more than 172 apprentices at our copper operations. Nineteen of these apprenticeships are sponsored or area apprentices, meaning they were only open to current Xstrata employees to provide them with the opportunity to up-skill or obtain a trade.

The program is designed to enhance our maintenance programs and strategies. It is focused on providing real employment and development opportunities for people living in the region and currently targets eight key trades.

In 2010 we invested approximately $5.2 million in apprenticeships and scholarships, and recruited 50 apprentices plus 11 school-based apprentices for their first year training at the Xstrata Skills Centre. 2010 also saw the introduction of a new school-based initiative and we took on five school-based operational trainees. In 2010 offers of employment have been made for 56 apprenticeships and 19 for school-based trainees who will begin in 2011.

The Xstrata Skills Centre has been developed to suit our growing business needs by up-skilling our trades people and providing a supportive and communicative environment for developing the skills and needs of our apprentices and trainees.

Developingvocationalskills

Our Vocational Skills Development Program targets secondary schools in the north west region. It introduces students to opportunities and careers within the mining sector and provides on-the-job training.

Program initiatives include structured work experience and readiness programs, traineeships, lead involvement in the Queensland Academy of Minerals and Energy, information programs and school-based apprenticeships. In 2010 the Work Experience Program incorporated four programs: the Work Experience Program, the Skills for the Future Program, the Engineering Camp and the Gifted and Talented Program.

In 2010 Xstrata Mount Isa Mines (copper and zinc-lead operations) awarded 16 bursaries worth $1,000 each to high performing secondary school students, to assist with their education, and they undertook work experience at site during their school holidays. In total, including bursary recipients, 107 students undertook work experience at Xstrata Mount Isa Mines (copper and zinc-lead operations).

Developingprofessionalskills

Our Mount Isa Mines copper operations recruited 18 permanent graduates in 2010. The Graduate Program provides employment and structured development opportunities for recent graduates and assists us to develop technical and leadership capability.

We also employed 61 university students in our Vacation Work Experience Program, based on demand in our copper operations. Students worked across the operations and undertook assigned projects. The program provides excellent salaries as well as assistance with accommodation and transportation.

Following the 2009–10 Vacation Program, 53% of participants returned to our Mount Isa Mines copper operations as either a vacation student or graduate for the 2010–11 intake.

In 2010 we awarded 14 bursaries worth $10,000 each to university students to assist them with their education.

ralph�Bartholomew�–�Training�Facilitator,�instructs�new�employees�at�the�Mount�Isa�Copper�Operations�New�Starter�Centre�in�the�safe�use�of�a�grinder

Our people


Prior to 2006, Xstrata employed on average 25 apprentices a year. However, in 2006, the $3.5 million custom built, state-of-the-art Xstrata Skills Centre commenced operation, employing 72 apprentices in its first year to help develop our own employees and continue to attract and retain our workforce. The unique environment of the Xstrata Skills Centre provides students with real life, hands-on work experience and interaction with other apprentices in an encouraging, safety-focused and disciplined environment.

Xstrata Mount Isa Mines now has over 250 apprentices or trainees on site. The training programs offered at the Skills Centre include several key innovative initiatives including the Apprenticeship Program, school-based apprenticeship, Certificate II in Metalliferous Mining, and Certificate I in Engineering.

On 27 January 2010, 50 new apprentices started work at the Xstrata Skills Centre. As with every new intake, 2010 saw a diverse group of apprentices come together, all motivated by the year ahead and the opportunity to develop their skills.

Dave Watson – Superintendent of the Xstrata Skills Centre, believes the first year at the Xstrata Skills Centre is a vital component of the Apprenticeship Program.

“The Xstrata Skills Centre is integrated into Xstrata’s Apprenticeship Program to offer students the opportunity to learn in a controlled and safe environment,” said Dave.

“It allows apprentices to develop essential skills without the pressure of production, so when they go out into the workforce they add value and make positive contributions,” he said.

Kerry Brisbane – Apprentice Team Leader, said there had been a lot of positive outcomes from the 2010 group.

“This year’s group of apprentices were fantastic. They worked well, and excelled at the projects they were given,” said Kerry.

“The apprentices participated in placements on site and in community events such as the Xstrata Mount Isa Mining Expo, Mardi Gras float and Christmas party set-ups,” she said.

Alongside the Apprenticeship Program, the Xstrata Skills Centre conducted school-based programs such as the school-based apprenticeships. During 2010, 11 students from high schools were given the opportunity to discover trade options and to experience what potential careers will hold for them.

Daniel DeValter commenced his full-time apprenticeship as a fitter and turner.

Joining the program straight from school, Daniel was familiar with the Apprenticeship Program from prior experience as a school-based apprentice and Xstrata bursary scholarship recipient.

“The school-based program gave me the opportunity to discover all the different fields and it helped me to decide which trade I wanted to do,” said Daniel.

“Being both a school-based apprentice and a bursary recipient gave me the advantage of getting my foot in the door and gave me experience in how Xstrata operates. It also assisted me to build a positive relationship with the supervisors,” he said.

Xstrata also introduced the school-based Trainee Program, which was introduced to encourage year 12 school students to consider working at Xstrata Mount Isa Mines after leaving school. There were five students selected for the program in 2010 and four of these were Indigenous students. All five students completed and achieved a Certificate II in Metalliferous Mining. Three of the students were given apprenticeships, while the other two students returned to their own communities in Normanton and Doomadgee to find work. The program proved so successful in 2010 that the company’s school-based Apprenticeship Program will be modified in 2011 to include the Certificate II training elements.

2010 also saw the introduction of the Xstrata Skills Centre partnership with TAFE. This partnership has proved beneficial for the

case�study

Another successful year for our Apprenticeship Program

Xstrata Copper is committed to providing real and meaningful

vocational career pathways for individuals in careers that reflect the

needs of our business. We make it part of our business strategy to

invest in training and developing local talent.



Xstrata Skills Centre as it allows all Stage One training to be completed on site.

Dave Watson said the TAFE partnership has allowed Xstrata to better align its training program to business requirements.

“We realise the importance of training our own people and providing enhanced skills to employees so we have tailored our programs around the long-term goal of supplying the business with quality trades people specifically trained in areas that are relevant to our industry and site.

“It’s important that new apprentices be familiar with correct procedures like isolation and lockout, risk assessment and hazard identification, working in confined spaces or at heights, manual handling and be able to use hand tools correctly. Knowing these procedures and learning how to do the basics correctly significantly reduces incidents and prevents injury,” he said.

With motivated apprentices joining the program in 2010 and changes to the training regime, 2010 was another successful year for the Xstrata Skills Centre.

The Xstrata Skills Centre is an example of our commitment to providing our staff with the highest level of skills possible and in doing so creating a sustainable future for our local communities in north Queensland.

Employees by employment contract Number

Permanent 2,143

Temp/Fixed Term 117

Total 2,260

Employees by employment type Number

Full Time 2,236

Part Time 24

Total 2,260

Turnover profile by age and gender Female Male Total

Under 30 37 115 152

30 to 50 42 160 202

over 50 4 42 46

Total 83 317 400

Turnover profile by role typeNumber of

leaversNumber of employees

Percentage turnover

Executive Management 0 1 0

Senior Management 2 8 20

Management 32 150 17.6

Supervisors, administration, technical 122 683 15.2

Operational, production, maintenance 244 1,418 14.7

Total 400 2,260 17.7

Average training hours by employee Senior Management Workforce

Average hours per employee/year 17.7 105.7

Average cost per employee $2,044 $5,242

Training hours by role type Actual hours Average hours

Executive Management 0 0

Senior Management 71 18

Management 11,144 66

Supervisors, administration, technical 58,107 77

Operational, production, maintenance 283,553 174

Total 352,875 138

Ratio of men and women Women Men

Senior Management 11% 89%

Workforce 14% 86%

Employees by role type and gender Female Male Total



Management 24 126 150

Supervisors, administration, technical 220 463 683

Operational, production, maintenance 74 1,344 1,418

Total 319 1,941 2,260

Employees by age and gender Female Male Total

under 30 143 572 715

30 to 50 157 1,038 1,195

over 50 19 331 350

Total 319 1,941 2,260

Our people


Clockwise�from�left:�First�year�mechanical�fitting�apprentices�receive�instruction�from�Peter�Fricke�–�Xstrata�Skills�Centre�Instructor�

First�year�electrical�apprentices�receive�instruction�from�Cameron�Gibson�–�Xstrata�Skills�Centre�Instructor

Cameron�Gibson�instructs�first�year�electrical�apprentice�Gary�Knight

Our peopleErnest Henry Mining

EmploymentIn 2010 Ernest Henry Mining (EHM) provided jobs for 911 people (401 permanent and 50 fixed-term and casual employees, 249 permanent contractors and an average of 211 project contractors). Our rate of voluntary employee turnover for 2010 averaged 10% which is similar to turnover in 2009 despite different circumstances during these years. Turnover in 2009 declined due to a roster change in 2008, whereas 2010 saw an increased staff turnover rate as a result of the impending open pit mine closure and a number of employees leaving for more long-term, permanent opportunities. Average voluntary turnover of 10% is lower than the voluntary turnover rate of 17.6% reported by Queensland participants in the Resources Industry Turnover Analysis.

Staff turnover in 2010 increased consistent with the changing business focus at EHM and in particular the scheduled closure of the open pit mine, and development and eventual opening of the magnetite plant and underground mine. Open cut mining and underground mining are significantly different and not all of the open pit mine employees have elected to transition to an underground role. Where employees have elected to leave, we are working on a ‘transition to life after EHM’ plan for individual employees so that the transition is smooth and supported.

All permanent and temporary employees receive the same benefits, with the exception of casual employees who receive a higher base pay rate to compensate for paid leave provisions. Trainees are employed on a casual basis and once they are deemed competent are offered permanent positions with all benefits, inclusive of leave, roster allowances and various other mine-specific allowances.

Employmentprofile–ErnestHenryMiningContractors

16%� Cloncurry

23%� Cairns

35%� Brisbane

26%� Townsville

Employmentprofile–ErnestHenryMiningEmployees

23%� Cloncurry

19%� Cairns

30%� Brisbane

25%� Townsville

3%� Mount�Isa�and�others

Henry�Wang�–�Vacation�Student�(Electrical�Engineering),�helps�to�set�up�scrapers�for�magnetite�filtration�at�Ernest�Henry�Mining

Our people


Employing�locallyEHM is a fly-in/fly-out operation. Preference is given to potential employees from the local Cloncurry community, however technical and professional skills are not always available locally. All employees in professional and technical roles are offered the option of relocating to Cloncurry at company expense. In 2010 EHM introduced a number of improved incentives to encourage more workers to move to Cloncurry. See the case study on page 52 for more detail.

Following on from 2008 and 2009, when EHM introduced a replacement-only recruitment strategy, due to the anticipated closure of open pit operations, 2010 saw increased employee and contractor numbers to accommodate the underground mine and magnetite build projects. The EHM Village increased from 284 permanent ensuite rooms to 384 permanent and 200 temporary ensuite rooms.

Training�and�educationEHM has a number of career opportunities available to our employees, including:

Building leadership

The Leadership Development Program (LDP) provides participants with leadership skills and the program incorporates leadership, coaching for performance, planning and communication. In 2010, 88 EHM employees attended the program, with 56 participants completing the course.

EHM continued to roll out the Life Styles Inventory (LSI) program to all supervisors. In 2010, 38 EHM employees participated in an LSI survey which is a 360 degree leadership style peer review with follow up coaching.

Fosteringapprentices

In 2010, two apprentices from the electrical and mechanical disciplines completed their third year and one apprentice graduated. In 2011, six new apprenticeships (four maintenance and two electrical) will commence at EHM.

*� �Turnover�percentage�represents�all�staff,�including�casual,�fixed-term�project,�and�temporary�staff�(contractors�not�included).

^� �We�had�high�turnover�in�2010�due�to�the�pending�end�of�open�pit�operations�and�the�Underground Build�Project�activities.

Employees by employment contract Number

Permanent 401

Temp/Fixed Term 50

Total 451

Employees by employment type Number

Full Time 450

Part Time 1

Total 451

Turnover profile by age and gender Female Male Total

Under 30 11 17 28

30 to 50 8 27 353

over 50 1 11 12

Total 20 55 393

Turnover profile by role typeNumber of

leaversNumber of employees

Percentage turnover



Management 3 11 27.3

Supervisors, administration, technical 35 226 9.7

Operational, production, maintenance 33 213 13.2

Total 75 451 16.6*^

Average training hours by employee Senior Management Workforce

Average hours per employee/year 52 77

Average cost per employee ($) 1,500 850

Employees by role type and gender Female Male Total



Management 4 27 31

Supervisors, administration, technical 44 144 195

Operational, production, maintenance 38 181 212

Total 86 365 451

Employees by age and gender Female Male Total

under 30 34 82 116

30 to 50 47 214 261

over 50 5 69 74

Total 86 365 451

Minority Group Employees Number Percentage

Female 1 5.6

Male 17 94.4

Total(IncludesESL&ATSI) 18 100

Ratio of men and women Women Men

Senior Management 0% 100%

Workforce 20% 80%

ErnestHenryMining

Our people


Developingvocationalskills–trainingopportunitiesforschoolstudents

Our Vocational Skills Development Program introduces students to opportunities and careers within the mining sector and provides on-the-job training that contributes directly to a recognised qualification (Certificate I or trade).

In 2010 two local school students undertook work experience and vocation work at Ernest Henry Mining. One student undertook three separate work experiences to determine if he was suitable for an apprenticeship, and has since been awarded one. Three students were awarded an Xstrata School Bursary of $1,000 with work experience to commence in February 2011.

IndigenousTraineeshipProgram

2010 saw the commencement of an Indigenous Traineeship Program at EHM. The program provides Indigenous people with the skills necessary to gain employment in the mining industry. Under the guidance of a Coordinator – Indigenous Trainees, seven trainees participated in the program during the year, and a further five trainees commenced the program in January 2011.

Labour�relationsIn 2008 all EHM employees were employed on individual staff contracts or Australian Workplace Agreements (AWAs). Following the changes in federal legislation in 2010, no new AWAs/ITEAs were entered into during the year.

In 2009 EHM implemented an Employee Collective Agreement. Currently 41 employees are employed under this Collective Agreement, and as current AWAs expire and employees transition to underground work, employees will move onto the Collective Agreement. All new non-staff employees are employed under the terms and conditions of the Collective Agreement.

At all times we seek to be open and honest with our employees, promoting a culture of success and capability.

Clockwise�from�top:�Myles�Johnston�–�General�Manager�Ernest�Henry�Mining,�presents�a�State�of�the�Operation�update�to�workers�at�Ernest�Henry�MiningEdward�Oliver�–�Indigenous�Trainee,�helps�with�renovation�works�in�an�office�building�at�Ernest�Henry�MiningBeryl�Walker�–�Mining�Technician,�at�the�controls�of�Ernest�Henry�Mining’s�Liebherr�996�shovel�Peter�Kirk�–�Concentrator�Technician,�and�Cam�McClymont�–�Mechanical�Technician,�complete�an�overhead�crane�training�course�at�Ernest�Henry�Mining

Our people


More than 130 people applied for roles or enquired about underground employment. Following this, 74 employees were interviewed for underground roles, 66 employees went underground for tours and 49 employees were selected for available roles. To date, 31 employees have accepted employment in underground roles.

We also conducted a survey of employees to establish how many were interested in working in EHM’s underground mining operation and if not, identifying what services they required to transition to other employment either within the business or externally. Completion interviews were held with those employees who would be leaving the business after closure to help finalise plans for redeployment options.

Completion interviews were undertaken for all mining and professional staff affected by the closure. Around 200 interviews were held over a six month period from September 2010. The interviews identified that most employees wanted to remain with Ernest Henry Mining or Xstrata if they were able to secure work in a similar role to the one they had previously undertaken for the business. We have commenced the process of identifying suitable opportunities for those employees interested in remaining with us.

An additional workforce planning initiative involved offering internal roles to employees in the Mining Department, the first group of employees affected by the open pit mine closure. As roles in other areas of

Ernest Henry Mining’s open pit operation is scheduled for closure in August 2011 and the closure will affect approximately 200 employees. A transition strategy is helping to ensure a smooth transition for all employees, either through redeployment within Ernest Henry Mining (EHM) and Xstrata, or within the mining industry.

EHM’s transition initiatives include transitioning employees from open pit to underground roles; completion interviews; and offering roles internally.

The move to underground mining presented an employment opportunity to open pit miners, but the two mining environments and practices are distinctly different. Many miners in this situation find they do not want to transition from open pit to underground mining, or when they attempt to transition they find working underground challenging. Despite this, EHM was still keen to progress this initiative as an option for open pit miners.

By November 2009 EHM had identified which underground roles could be undertaken by open pit employees provided adequate training was undertaken. There were 40 technician roles that could be created for the current open pit mine production teams to fill.

In late 2009 expressions of interest for underground roles were called and interviews commenced in March 2010. All candidates underwent a rigorous interview process and were given the opportunity to go underground to experience conditions.

the business became available, they were advertised internally to attract those people affected by the pending closure. Four employees were successful in securing and transferring to different departments at EHM.

During 2011 we will continue to offer our support to those employees leaving the company after closure of the open pit operation, including financial and superannuation counselling, and outplacement services including résumé preparation, job search advice, and interview practice. This assistance is provided to help people successfully move on to the next stage in their careers.

Kenny Mountford, an EHM employee who is transitioning from open-pit to underground mining, said he was interested in gaining more skills and knowledge in a different area of mining.

“I applied for an underground position so that I could gain more skills and knowledge in another area of mining at EHM,” said Kenny.

“I enjoyed the physical work the training involved, and I also enjoyed the workmanship with the underground personnel.

“The training taught me a lot about underground mining - new techniques and the way things are done in this area of mining.

“EHM provided us with the option of transitioning to underground, and it’s a good opportunity for employees who are keen to do something new within the business and a chance to better themselves,” he said.

For the past three years at Ernest Henry Mining, we have been

consulting with our workers on Life of Mine planning, and will

continue to work and communicate with employees and contractors

as the site transitions to underground mining operations in 2011.

case�study

Transitioning our workforce through workplace planning and support

Above:�Kenny�Mountford�–�Services�Technician�in�the�EHM�open�pit�mine,�completes�training�underground�after�expressing�interest�in�taking�up�an�underground��role


Our people

EHM announced this change and its new incentives to around 40 members of the public at a Community Information Session held in Cloncurry in October.

Mayor of Cloncurry Andrew Daniels stood up during the session’s question time to thank EHM for its commitment towards local employment and its ongoing support for the Cloncurry community.

“These changes are a huge step in the right direction so we can attract more people to town. The more people we have living and spending here, the better for Cloncurry,” Andrew said.

Myles Johnston said that a coordinated approach is required to improve the attraction and retention of people to Cloncurry.

“We will continue to work with Cloncurry Shire Council and the community as a whole to implement initiatives that will help Cloncurry to grow and prosper,” he said.

“As we transition to underground mining and magnetite processing we are determined to continue balancing FIFO and local employment so we can minimise the impacts of FIFO on our local community.

“Since the incentives were introduced we have had two FIFO employees request to relocate to Cloncurry. There have also been a number of queries from other people considering moving to town and two locally-based employees have cancelled their requests to become FIFO,” he said.

Besides monetary incentives, EHM has also changed its FIFO eligibility period for certain roles from two to three years. This is the amount of time an employee must work in their role before being eligible to become FIFO.

Local employment rates demonstrate that we have managed to stabilise local employment since the introduction of the increased allowance. From June 2007 to June 2010, local employee numbers reduced from 171 to 93, but since then we have seen a steady increase to 110 employees in January 2011 and we will continue to review these numbers to ensure these figures remain stable.

Since 2007 Ernest Henry Mining (EHM) has seen a reduction in the number of employees living locally. Workshops were held early in 2010 to develop initiatives to counteract this growing trend. As a result, improved local living incentives were introduced.

EHM’s local living allowance increased significantly in September for all Cloncurry-based employees.

EHM also introduced an accommodation allowance for people in supervisory and managerial roles who were not living in company-provided housing.

“We believe these improved incentives will help us to retain more of our local workforce and attract more employees to live in Cloncurry,” said Myles Johnston – General Manager Ernest Henry Mining.

“At present around 23% of our employees reside in Cloncurry with the remainder being fly-in/fly-out (FIFO) from Brisbane, Townsville and Cairns.

case�study

Local initiatives to encourage workers to move to CloncurryErnest Henry Mining recently improved its local living incentives in a bid to

encourage more workers to move to, and remain in, Cloncurry.

“At present around 23% of our

employees reside in Cloncurry with the

remainder being fly-in/fly-out from

Brisbane, Townsville and Cairns.”

Peter�Watling�–�Shutdown�Coordinator�at�EHM,�has�requested�to�move�to�Cloncurry�after�flying�in�and�out�of�Brisbane�for�more�than�13��years�


Our people

Our peopleTownsville operations

EmploymentIn 2010, the Townsville operations provided jobs for 258 people (176 employees and 82 contractors). The rate of voluntary employee turnover in 2010 averaged 10.5% for the copper refinery and 5.8% for the port operations, which were both well below the average voluntary turnover of 17.6% reported by Queensland participants in the Resources Industry Turnover Analysis.

The benefits provided to permanent employees at the Townsville operations that are not provided to casual employees include: paid leave provisions, external/tertiary education assistance, higher rates of superannuation, disability cover and salary continuance.

Employinglocally

The Townsville operations are committed to employing local residents and the majority of our workforce is employed on a permanent basis. We have a permanent workforce of 172 people and the majority of these are from the Townsville-Ayr region.

Training�and�educationThe Townsville operations invested over $780,000 on training during 2010, an average of $4,406 per employee. This is a substantial increase from 2009, and ensured employees received improved levels of safety and health competency training to perform their work activities throughout 2010.

The Training Advisor worked closely with line management, supervisory staff and key personnel throughout the year to identify training requirements. Our training systems continued to focus on delivering competency-based training for all workers.

A communication strategy was implemented in 2010 to help achieve our training targets and to increase training awareness across the Townsville operations. This involved regular communication through weekly and monthly reporting, regular announcements via email and the intranet, and also through verbal means, resulting in an increased awareness of training by employees. In support of this strategy, a significant increase in training sessions with more flexible training times was offered.

“ The Townsville operations are committed to employing local residents and the majority of our workforce is employed on a permanent basis.”

Gerry�Figg�–�Project�mechanical�supervisor,�Townsville�operations

Our people


Employees by age and gender

Copper refinery Port operations

Female Male Total Female Male Total

Under 30 6 11 17 1 3 4

30 to 50 6 62 68 1 17 18

Over 50 3 54 57 1 11 12

Total 15 127 142 3 31 34

Although the 2010 target of >85% compliance to mandatory training for both the copper refinery and port operations was not achieved, a significant improvement was recognised with an overall result of >80% compliance for the copper refinery, as compared to 69% achieved in 2009, and at our port operations we recorded a result of 71% compliance, up from 65% recorded in 2009.

BursaryProgram

The Xstrata North Queensland Bursary Program was successfully introduced to the Townsville operations in 2008. In 2010 the program was temporarily put on hold due to resourcing issues. There are plans to reintroduce the program during 2011, with the Townsville operations committed to awarding two $1,000 bursaries.

Labour�relationsIn 2010, 43.4% of our employees were covered by Collective Bargaining Agreements, and 56.6% were covered by either Australian Workplace Agreements (AWAs) or Common Law contracts. The Townsville copper refinery’s Collective Agreement was voted on in 2009 and ratified by Fair Work Australia in 2010. Negotiations commenced on a new Enterprise Agreement for the Townsville port operations in 2010, with negotiations expected to be concluded early in 2011. Employees currently employed under AWAs will progress to the Collective Agreement on expiry of their AWAs. All new non-staff employees will be employed under the Collective Agreement.

In 2010 the Townsville operations’ SD Workforce Committee comprised 50% employees and 50% management which included line supervisors, superintendents and managers, and the Committee met monthly.

Employees by employment contract

Copper refinery Port operations Total

Permanent 139 33 172

Temporary/Fixed term 3 1 4

Total 142 34 176

Employeesbyemploymenttype

Copper refinery Port operations Total

Full time 142 34 176

Part time 0 0 0

Total 142 34 176

Turnover breakdown by age and gender


Age and gender Female Male Total Female Male Total

Under 30 1 6 7 0 0 0

30 to 50 4 7 11 0 0 0

Over 50 0 6 6 0 1 1

Total 5 19 24 0 1 1

Average training hours by employee type

Senior Management Workforce

Average hours training per employee/year

10 72

Average cost per employee $4,839 $4,839

Ratio of men and women


Women Men Women Men

Senior Management 0% 100% 0% 0%

Workforce 11% 89% 9% 91%

Employees by role type and gender


Female Male Total Female Male Total

Executive Management 0 0 0 0 0 0

Senior Management 0 1 1 0 0 0

Management 2 8 10 0 4 4

Supervisors, administration, technical

10 26 36 3 8 11

Operational, production, maintenance

3 91 95 0 19 19

Total 15 126 142 3 31 34


Our people


During 2009 the Job Role Criteria tool evolved into an interactive web-based resource that provided an accessible, useable, and dynamic presentation of key information that medical, rehabilitation, and operational staff could use throughout the injury management process. The role library grew to over 200 roles and there was an expansion of the evidence base to include Thermal Work Limit, Manual Task Risk Matrix, Whole Body Vibration data, and the review of 17 areas and roles across Xstrata’s north Queensland operations.

The Job Role Criteria tool was rolled out in 2010 through presentations to management, safety, health, training, human resources and medical staff, by the North Queensland Safety and Health department. The web-based program was made available on the Xstrata Mount Isa Mines intranet, making it highly accessible, user friendly, and able to be updated continually. The program provides access to nearly every job on site. Each job contains a role description, its physical requirements, the environmental context of role participation and cognitive performance components for task participation. In addition, the tool was

developed as a transportable USB-based resource to allow access and interaction by remote and travelling staff and employees.

Brad Pritchard – Occupational Therapist at Xstrata Mount Isa Mines, and Lyndonna Ross – Graduate Occupational Therapist, said it had proved a very useful tool across the company’s north Queensland sites in 2010.

“The Job Role Criteria Tool provides a comprehensive and rich evidence base that allows external medical specialists and internal health and rehabilitation people to make a more informed decision about future goals and the suitability to provide assistance in a return to work process,” said Brad.

“The program has the potential to be used in other departments such as the Safety Department during workplace risk assessments, and human resources during recruitment, not just those based on rehabilitation and other medical services,” he said.

Leanne Ryder – Senior Human Resources Advisor, said the program had been very useful for Human Resources.

“This is a great tool for the recruiting process, as it’s just not possible for one person to know all the tasks and role requirements for every single job across our north Queensland sites,” said Leanne.

“The program is easily accessible on our intranet site, and gives us an instant view of what’s required physically to do a particular job, which has proved really useful throughout the year,” she said.

Since being rolled out in 2010 the Job Role Criteria tool has made notable improvements to:

■■ Pre-employment processes – by providing an objective measure from which to assess applicants

■■ Injury Prevention – by highlighting and addressing hazardous tasks and/or work practices

■■ Injury Management processes – by facilitating appropriate tasking, and providing ultimate functional goals for rehabilitation

■■ Training and Human Resources functions.

Overall, the tool has assisted communication and rehabilitation program development between health, injury management and workplace management and area leaders. It has provided a common language and reference point, assisting in planning, developing and assessing rehabilitation goals and operational risk.

Case�study

Job Role Criteria greatly assists the injury management process

Originally developed in 2005 to meet an emerging demand from the working population, the Job Role Criteria tool was designed to assist health and rehabilitation staff during their assessments, observations, treatment and considerations in relation to the daily occupational activities of employees. It has since become a proactive injury management tool which details the functional requirements of all roles within Xstrata’s north Queensland operations.

The�Job�role�Criteria�tool�assists�health�and�rehabilitation�staff�to�identify�the�functional�requirements�of�all�roles�on�site


Hugh�Dickinson-Jones�plays�on�new�equipment�at�Cloncurry�Kindergarten�purchased�under�the�XCPPNQ


Sustainable communitiesWe contribute to the sustainable social and economic development

of communities near our operations.

Xstrata Copper seeks to improve the quality of life of communities near its operations. We believe that contributing to the development of sustainable communities and engaging with our stakeholders in two-way, open dialogue enhances our corporate reputation and is crucial to maintaining our social licence to operate.

We identify our communities and other stakeholders at the earliest possible stage and maintain an active, transparent and culturally appropriate engagement with them throughout the life cycle of our operations. In this way, we seek to establish mutually beneficial relationships based on active engagement.

We register, monitor and address questions and complaints from communities. We establish fair and equitable processes for engagement with Indigenous and local communities, seeking, where relevant, their prior and informed consent and respecting their culture, customs, interests and rights.

Our Corporate Social Involvement (CSI) program in north Queensland includes the Xstrata Community Partnership Program North Queensland (XCPPNQ) and a sponsorships and donations program.

Through the XCPPNQ, we seek to develop partnerships with the community in the areas of art and culture, education, enterprise and job creation, the environment, social and community development and health. These partnerships contribute to the sustainable development and local capacity building of communities.

We also support a range of other community initiatives and major events in these areas through a sponsorship and donations program, and provide significant in-kind support to community groups through the provision of goods, materials or personnel time throughout the year.

Xstrata Copper also supports local businesses and employs local people in a bid to strengthen local and regional economies.

Key community challenges for the Xstrata Copper North Queensland Division include:

■■ Building community capacity to improve social services and facilities

■■ Ensuring Indigenous cultural heritage is not affected by our mining operations

■■ Increasing emphasis on and awareness of our programs and their long-term, beneficial impacts on the development of our communities.

Stakeholder�engagement�and�consultationThe Xstrata Copper North Queensland Division encourages dialogue with our stakeholders and integrates stakeholder feedback into business planning and strategy. Stakeholder feedback is used to identify and manage risks and opportunities, guide our strategy and business activities, protect and develop our corporate reputation, strengthen stakeholder relationships, manage expectations, respond to concerns and share our plans for the business.

We systematically identify our external stakeholders at a divisional, site and operational level on a regular basis. Proactive communication occurs with external stakeholders who are concerned with or affected by our sustainable development performance. Stakeholder engagement is conducted in an equitable and culturally appropriate manner with the maximum transparency that is commercially possible.

Sustainable Development (SD) strategies are reflected in consultation with relevant internal and external stakeholders. Annual SD plans are developed and implemented at divisional and site levels in consultation with identified internal and external stakeholders.

Through internal assessments of key groups, our membership of various associations, and engagement with interested parties, the Xstrata Copper North Queensland Division has identified its stakeholders, which are outlined throughout this section.

Community�feedbackOur engagement program is critical to our understanding of material SD issues. As part of our commitment to sustainable development and ensuring we identify and respond to community needs, we conducted the Xstrata North Queensland 360° Key Stakeholder Survey in 2010. This survey is conducted every two years.

An independent research firm conducted interviews with 64 stakeholders in Cloncurry, Mount Isa, Townsville and Bowen asking questions about their opinions of Xstrata’s community support programs, view of major social and environmental issues facing the community, the dissemination of information from Xstrata’s north Queensland operations and the best way for Xstrata to communicate news and information to local residents.

Survey participants included 22 stakeholders in Mount Isa, 12 in Cloncurry, 16 in Townsville and 14 in Bowen. From this research the following areas of concern were identified:

■■ The economy, outlook for the future and the possible impact of a planned mining tax on Xstrata’s operations and investment in north Queensland

■■ The lead issue and the impact negative publicity could have on attracting prospective workers and external businesses to Mount Isa if they perceive there is a health risk due to lead in the environment

■■ Employment opportunities for young and Indigenous people

■■ The impact of fly-in/fly-out (FIFO) workers on the communities of Mount Isa and Cloncurry

■■ Infrastructure access and costs.


An action plan will be developed to address issues and concerns raised, and feedback from the survey will also be used to review and refine, where appropriate, our operational responses to these issues in 2011. We look forward to responding to residents’ concerns at our north Queensland operations as part of our commitment to continuous improvement.

In addition, in 2011 we will undertake our biannual Community Attitudes Survey of more than 1,200 local residents across our north Queensland communities. Combined with the stakeholder feedback, we will have a full picture of our social involvement planning requirements for 2012.

Corporate�Social�Involvement�(CSI)�programXstrata Copper commits up to 1% of its pre-tax profit each year to fund CSI initiatives and activities in the communities in which we operate.

From these funds we run the successful Xstrata Community Partnership Program North Queensland (XCPPNQ). Established in 2004, the program reflects our belief that local communities should benefit from our operations, both in the short and long term.

The program commenced in 2005 with $4 million and supported 34 community initiatives in the communities of Mount Isa, Cloncurry, Townsville and Bowen. The program has since expanded to support more than 60 initiatives and several social infrastructure projects with a total program value of more than $16.4 million through to the end of 2010, and is delivering real improvements to our north Queensland communities.

The increase in XCPPNQ funding since 2009 is a result of the social infrastructure projects that are supported through this program that were not previously reported on under this program in our sustainability report. From 2008–10 we contributed $5.5 million towards several key social infrastructure projects in our north Queensland communities.

In addition to the XCPPNQ, the Division invested more than $614,000 in 2010 on sponsorships, donations and in-kind community support initiatives. Please see the pie graphs below.

Community�grievancesThe Xstrata Copper North Queensland Division records, monitors and addresses community complaints, takes corrective action where appropriate, and provides feedback to complainants.

In 2010 the Division received 124 community complaints, and all of these were received in Mount Isa. All complaints were handled by our Xstrata Mount Isa Mines Community Relations team and were responded to promptly. Refer pie graph below for breakdown of complaints by type.

Indigenous�rights�and�Aboriginal�cultural�heritageThe Xstrata Copper North Queensland Division respects the traditional rights of Indigenous people and supports Aboriginal cultural heritage and customs. It structures its engagement activities in a manner that is culturally appropriate and facilitates the active involvement of Indigenous peoples, including traditional custodians in consultation, including capacity-building initiatives, where necessary or appropriate, and welcoming ceremonies as part of our approach to community activities.

Mine�closureMine closure planning is integral to Xstrata Copper’s approach to sustainable development whether the life cycle of projects are short or long term. As a requirement of our Environmental Management System, the Xstrata Copper North Queensland Division maintains closure plans based on Xstrata’s Closure Facility guideline, which includes requirements for socio-economic considerations and requires sites to maintain and continually review site closure plans for sustainable, stable, non-polluting final mined landforms. In these reviews the sites must check for the adequacy and effectiveness of their existing approaches to closure and improve them through regular review of identification and implementation of best practice research and monitoring programs. Further details on our north Queensland operations’ mine closure plans are outlined in this section.

Totalcommunitycomplaintsbytype–XstrataCopperNorthQueensland

57%� Fallout�damage

36%� Fumes

1%� Noise

6%� Other

TotalCSIexpenditurebycommunity–XstrataCopperNorthQueensland

36%� Mount�Isa� (Mount�Isa� Mines�copper�

operations)

50%� Cloncurry� (Ernest�Henry� Mining)

14%� Townsville� (Townsville� operations)

TotalCSIexpenditurebytype–XstrataCopperNorthQueensland

11%� Enterprise�andjob�creation

50%� Social�andcommunity

� development

10%� Education

12%� Environment

12%� Health

5%� Art�and�culture

XCPPNQexpenditurebytype–XstrataCopperNorthQueensland



� development

8%� Education

16%� Environment

12%� Health


Sponsorships,donations,in-kindcommunitysupport–XstrataCopperNorthQueensland



� development

13%� Education

5%� Environment

12%� Health


Sustainable communities


Xstrata’s partnership with Queensland Health through the Xstrata Community Partnership Program North Queensland is supporting this free community service that targets prevention, early intervention, treatment and self management of diabetes. The clinic treats adults and youth from Indigenous and non-indigenous backgrounds, children with diabetes and pregnant women suffering from gestational diabetes.

Diabetes is Australia’s fastest growing chronic disease, and it is particularly prevalent among Indigenous Australians, where the incidence rates of diabetes have more than doubled over the past decade. Diabetes is a serious concern in the Mount Isa Health Service District; while 8.7% of the District’s non-indigenous population have diabetes, more than 14% of the Indigenous population

are sufferers, and this is compared with a national average of less than 5%. This highlights the demand for a local, dedicated diabetes management clinic to help sufferers manage their disease and avoid the serious complications that can arise from it.

The clinic employs two full-time clinical nurse consultants (diabetes educators). They conduct local clinics in Mount Isa and also provide an outreach service, where they regularly visit outlying Indigenous communities to provide diabetes education to people who would not otherwise have the resources to travel to Mount Isa for treatment.

The service’s diabetes educators provide specialist diabetes management advice to general practitioners and healthcare workers in Mount Isa, and conduct regular diabetes and nutrition awareness sessions at local schools, community groups, and at events including the Xstrata Mount Isa Mining Expo.

The Mount Isa Diabetes Clinic has shown some very positive results in improving the health of those people living with diabetes. Statistics from the clinic show that following treatment and advice, clients have an average reduction in blood glucose levels of 1.4%, equating to diabetes complications being reduced by 33.6%.

Xstrata has supported the service for six years with a total funding contribution of $360,000 over this period. From 2011, Xstrata will continue to provide support for the clinic through its donations and sponsorships program.

Case study

Mount Isa Diabetes Clinic continuing to make a difference

More than 6,000 free consultations have been provided to people

with diabetes in the Mount Isa region since the Mount Isa Diabetes

Clinic commenced in 2005 (previously the Mount Isa Diabetes

Service). This has significantly alleviated pressure on the region’s

healthcare system by reducing the number of diabetes patients seen

regularly by local doctors and health clinics.

Kerry�O’Brien��–�Mount�Isa�Diabetes�Clinic�Outreach�Educator,�discusses�nutrition�with��Frances�Page



■■ Holding two Business Stakeholder Briefing Sessions for local business owners and associated groups regarding the Federal Government’s proposed Resources Super Profits Tax and the suspension of Ernest Henry Mining’s shaft underground mine project and Xstrata’s regional exploration program

■■ Mailing 10 issues of the Mine to Market newsletter to employees and stakeholders

■■ Contributing articles to, and advertising in, the North West Star, and facilitating interviews with local radio outlets to keep community members informed about our operations

■■ Hosting four anniversary dinners for long-term employees celebrating 20, 30, and 40 years of service

■■ Conducting regular surface tours of the mining operations in conjunction with community tourism organisations

■■ Visiting local schools to explain mining and environmental processes to students studying mining units in science

■■ Hosting operational site visits for visiting Australian and overseas dignitaries

■■ Conducting community, employee and multi-stakeholder forums and workshops

■■ Organising regular customer, business partner and supplier meetings

Engagement with stakeholders in 2010 included:

■■ Distributing the 2009 Xstrata Copper North Queensland Sustainability Report and 2009 Xstrata Mount Isa Mines Sustainability Report to employees and other key stakeholders

■■ Conducting three Community Information Sessions to share information on our operations and provide a forum for feedback from community members

■■ Conducting a 360° Key Stakeholder Survey to gain feedback on issues of importance to them and determine where best to direct our future efforts

■■ Launching Mount Isa Mines website www.mountisamines.com.au

■■ Launching a freecall Community Feedback Hotline 1800 982 982

■■ Conducting a publications survey

■■ Conducting two Supplier Forums to share information on Xstrata’s business and for suppliers to learn about our SD practices

Stakeholder�engagement�and�consultationThe Mount Isa Mines copper operations identify its key stakeholders as:

■■ residents of Mount Isa

■■ Xstrata employees and contractors, unions and other organisations that represent these groups

■■ Traditional Custodian groups in north west Queensland, including the Kalkadoon

■■ business partners, including joint venture partners, suppliers and customers

■■ local, state, and national governments and their agencies

■■ inter-governmental bodies and organisations

■■ local schools

■■ local, regional, national, and international media

■■ non-government and community-based organisations

■■ Xstrata Community Partnership Program North Queensland (XCPPNQ) partners.

Sustainable communitiesMount Isa Mines copper operations

Eli�Vincent�–�Environmental�Technician,�assists�Barkly�Highway�State�School�students�plant�the�garden�they�won�as�part�of�Xstrata’s�sponsorship�of�Green�Week



The Xstrata Apprenticeship Program continued to expand with a further 50 apprentices employed in 2010 making the program the largest of its kind in north Queensland.

Futureofthemineandlong-termviabilityofthetown

Xstrata Mount Isa Mines is committed to investing in CSI activities including the development of social infrastructure in Mount Isa (refer to the XCPPNQ table for social and community development initiatives). In 2010 we contributed $2 million towards the construction of a new Dental Health Building and training centre. This social infrastructure initiative forms part of the Queensland Government’s $65 million redevelopment of the Mount Isa Hospital.

LeadinbloodlevelsinMountIsa

Many residents were concerned with the issue of blood lead levels. Over the past six years, Xstrata has invested more than $275 million in over 220 environmental initiatives to minimise potential impacts of our operations on the environment and local community. We continue to support the Living with Lead Alliance to deliver community education programs concerning living safely with lead in Mount Isa. We also continue to offer free, independent and confidential blood-lead testing through Queensland Medical Laboratory for all community members.

During 2010, the University of Queensland progressed Phases Two (Air) and Three (Water) of the independent Lead Pathways Study following the July 2009 release of Phase One (Land) data that was independently peer reviewed. The reports for both Phase Two and Phase Three will be released and results communicated to the community during 2011. To date, Xstrata Mount Isa Mines has invested in excess of $30 million on a Smelter Emissions Project to further improve the capture and treatment of emissions from its lead and copper smelters.

In early 2011, a court proceeding was commenced on behalf of a claimant against Mount Isa City Council, the Queensland Government and Xstrata Mount Isa Mines seeking damages for alleged negligence. Our operations have never breached regulatory limits for respirable lead at any air monitor in the Mount Isa community since Xstrata’s acquisition of Mount Isa Mines in 2003 and Xstrata is prepared to answer the claim in court.

Community�feedbackThe Community Attitudes Survey (CAS) conducted in 2009 identified several key areas of concern facing the community. During 2010, we continued to address the community’s concerns:

Airpollution

Xstrata Mount Isa Mines maintains a robust air monitoring program including 10 sulphur dioxide (SO2) monitors and five dust samplers to monitor emissions in Mount Isa. We are also working on improving the capture and treatment of smelter emissions through the Smelter Emissions Project. During the year, several operational improvements were implemented to further reduce smelter emissions.

Unemployment

We are maintaining our employee levels at the Mount Isa Mines copper operations, and delivering XCPPNQ initiatives addressing enterprise and job creation (refer to the XCPPNQ table on page 64 for details).

■■ Offering a freecall Ethics Line and other formal grievance mechanisms, including a dedicated freecall community feedback 1800 telephone number

■■ Continuing our annual safety calendar competitions to engage children of employees of the Mount Isa Mines copper operations

■■ Publicising the Lead Pathways Study through local media and updates in Mine to Market

■■ Participating in regular meetings with our XCPPNQ partners

■■ Providing event management assistance for various community events

■■ Participating in major local events such as the annual Mining Expo, Rodeo, Fishing Classic, NAIDOC Week celebrations and employment expos.

In addition, members of our senior management team and employees in Mount Isa represented Xstrata Copper on boards including the Mount Isa Water Board; Mount Isa Chamber of Commerce; Laura Johnson Home; and local committees including Rotary, the Mount Isa Community Development Association, and School Parent and Citizen Committees. They also actively participated in community development organisations, coached and played in sporting teams and attended local and regional events.

Above:�Two�members�of��the�University�of�New�South�Wales�field�research�team�plaster�an�arm�bone�of�a�Diprotodon�discovered�in�June

Left:�Myuma�trainee�Shannon�Coats�learning�to�use�the�dumpy�level



Aboriginal cultural heritage very seriously and deeply regret this incident.

Xstrata Mount Isa Mines has a good working relationship with the Kalkadoon people and continued to work collaboratively with the Kalkadoon people to improve operational procedures to ensure the protection and preservation of Aboriginal cultural heritage sites of significance in 2010.

STEPers

In November 2008, the Mount Isa Mines copper operations signed an inaugural Structured Training Employment Project Employment Related Services (STEPers) contract with the Commonwealth Government’s Department of Employment, Education and Workplace Resources (DEEWR). This joint initiative with Jobfind Centres Australia and DEEWR to increase job opportunities for Indigenous people at our operations continued throughout 2010.

During the year a new, expanded program the Indigenous Employment Program (IEP) replaced STEPers. The program builds on existing program strengths and includes more support for small and medium businesses employers, including pre-employment training and mentoring. IEP will target regional areas and specific industries such as the mining industry that are experiencing labour shortages, as well as provide assistance to develop plans to recruit and retain Indigenous employees.

A total of 15 traineeships were undertaken in 2009 with full-time employment opportunities offered to nine participants during that year. Four indigenous trainees completed their traineeship in 2010 and have obtained full-time positions. An Indigenous trainee that obtained a full-time position post-STEPers has been successful in obtaining an apprenticeship for 2011. Four Indigenous trainees who went through the pre-employment program were offered traineeships in 2010 and will commence in 2011.

Corporate�Social�Involvement�programIn 2010 the Mount Isa Mines copper operations supported 10 initiatives with a program value of $280,000 under the XCPPNQ. See page 64 for further information on our partnerships. This is a significant reduction to our 2009 XCPPNQ contribution of $2.7 million; however last year’s figure was a result of two large social infrastructure projects totalling $2.25 million being supported through the program.

In addition to the XCPPNQ, we invested $326,548 in 2010 on sponsorships, donations and other community initiatives including support of many major community events and significant in-kind support to community groups through provision of goods, materials or personnel time. Please refer to the pie graphs on page 63.

Community�grievancesXstrata Mount Isa Mines operates a 24-hour community feedback hotline to manage complaints and enquiries and to provide feedback to callers. In late 2010, we launched a freecall Community Feedback Hotline 1800 892 892 and a dedicated feedback page on the Mount Isa Mines website www.mountisamines.com.au to further strengthen the link between our operation and the community.

In 2010, 53 complaints relating to our copper operations were received in Mount Isa and 71 fallout damage claims were made. The majority of our complaints related to fumes and in each case complainants were advised of the current Air Quality Control (AQC) Centre status and any action being taken. The AQC Centre closely monitors emissions and automatically closes down the smelter if emissions approach regulatory limits. Please refer to the pie graph on page 63.

Indigenous�rights�and�Aboriginal�cultural�heritageThe Mount Isa Mines copper operations facilitate the active involvement of Indigenous peoples such as the Kalkadoon through consultation, including capacity building initiatives where necessary or appropriate. Our Indigenous Affairs Policy has taken the position that identification of local lands with concern to Indigenous peoples shall be based on the Native Title Claims Register administered by the Australian Government’s National Native Title Tribunal (NNTT).

Any person carrying out an activity has an obligation to take all reasonable and practicable measures to ensure the activity does not harm Aboriginal cultural heritage. To ensure compliance with this obligation, our internal procedures require us to seek the engagement of the identified Aboriginal Party in the planning, conducting and reporting of Aboriginal Cultural Heritage Surveys prior to undertaking an activity that may disturb Aboriginal cultural heritage within the site of operations.

We have continued to work collaboratively with the Kalkadoon people to improve operational procedures to ensure the protection and preservation of Aboriginal cultural heritage sites of significance on our Mount Isa mining lease.

In 2010 we continued to assess all new mining and project areas for cultural significance, such as archaeological and sacred sites, prior to disturbance and in consultation with the Kalkadoon people. Both parties worked together during 2010 to develop strategies to avoid impacts where possible and to ensure that both parties have access to important sites prior to any activities being undertaken by Xstrata Copper on such sites.

No incidents of a breach or unauthorised disturbance of cultural heritage sites or artefacts were reported in 2010. However, in July 2010, Xstrata Mount Isa Mines was fined $80,000 in respect of inadvertent damage to cultural heritage objects while a contractor worked to upgrade a road in Mount Isa in 2008.

Draft internal Aboriginal Cultural Heritage and Land Clearance procedures had been developed in consultation with the Kalkadoon people and were being trialled when the incident occurred. The procedures were reviewed in the light of the incident and are now in place. We take the issue of protecting

AboriginalCulturalHeritageSurvey

Outcomes 2010

Number of Aboriginal Cultural Heritage Surveys completed

11

Totalareacovered(hectares) 1,360

Findings 2010

Aboriginal artefacts 6

Sites of significance 1

“ We have continued to work collaboratively with the Kalkadoon people to improve operational procedures to ensure the protection and preservation of Aboriginal cultural heritage sites.”



NationalIndigenousCadetshipSupportProgram(NICS)

In 2010 the Mount Isa Mines copper operations awarded one NICS Program placement to a local Indigenous tertiary student, and additional placements will be advertised in early 2011. This program is supported by DEEWR.

Creatingbusinessopportunities

After being awarded the contract in late 2009, Kalkadoon Community Pty Ltd continued to manage the two kiosks at our copper operations, resulting in the direct employment of nine Indigenous people to provide a continuous seven day, 15 hour service to our employees and contractors.

Kalkadoon Community Pty Ltd were also awarded several fencing contracts and completed fencing work at Xstrata Zinc’s Handlebar Hill open cut mine, the Marie Kruttschnitt Building and vacant land located adjacent to the Mount Isa RSL which forms part of the Mount Isa Mines lease. Kalkadoon Community were also awarded the contract for conducting weed control works on site.

Creatingcapacity

Members of Xstrata Copper’s senior management team in Mount Isa continued their involvement in the Queensland Resources Council’s North West Queensland Indigenous Resource Industry Initiative (NWQIRII) during 2010. The aim of the initiative is to develop strategies to increase engagement between the Indigenous community and businesses in the areas of employment, training and business development. One outcome in 2010 was an agreed collaborative approach to the development of an Indigenous mining sector employment passport that is expected to be implemented in 2011.

Mine�closureDuring 2010, the closure cost estimate was reviewed and updated by a third party civil engineering consultant. The update of the closure estimate included the consideration of more current earthworks rates as well as the inclusion of a contingency allowance. The latest estimates were supplied to regulating authorities in October 2010 for comment.

Furthermore, a Closure Planning Working Group was established with representation from all departments of the organisation. The working group identified gaps associated with closure planning and developed action plans to address these gaps in 2011.

TotalCSIexpenditurebytype–MountIsaMinescopperoperations



� development

11%� Education

15%� Environment

25%� Health


XCPPNQexpenditurebytype–MountIsaMinescopperoperations



� development

10%� Education

23%� Environment

31%� Health


Sponsorships,donations,in-kindcommunitysupport–MountIsaMinescopperoperations



� development

12%� Education

7%� Environment

20%� Health


Totalcommunitycomplaintsbytype–MountIsaMinescopperoperations

36%� Fumes

6%� Other

1%� Noise

57%� Fallout�damage

Above:�Spinifex�State�College�Year�9�students�and�Principal�Denise�Kostowski�in�the�new�Spinifex�Junior�Campus�future�classroom

Left:�The�Mount�Isa�community�turned�up�in�force�at�the�Xstrata�sponsored�Lake�Moondarra�Fishing�Classic�held�in�late�October



Mount�Isa�Mines�copper�operations

Xstrata Community Partnership Program North Queensland projectsEnterpriseandjobcreation

Project Partner Description Timeframe 2010 outcomes

North West Queensland Indigenous Catholic Social Services traineeships

North West Queensland Indigenous Catholic Social Services (NWQICSS)

Traineeships for disadvantaged Indigenous students

2008–10 Two new Indigenous trainees commenced traineeships in Community Services and have been placed across the NWQICSS network to work and develop skills needed to complete competencies. Both trainees completed their Certificate IV in Workplace Trainer and Assessor to become trainers for other NWQICSS staff.

Dugalungi Civil Construction and Mining Skills Prevocational Program

Myuma Pty Ltd Fund places for Indigenous participants in two separate 13-week live-in programs, and funds to support the expansion of training and mentoring services delivered during and between programs

2008–10 Myuma conducted two 13-week training programs at the Dugalungi camp in Camooweal in 2010, each of which attracted 30 Indigenous participants.Of the 60 participants who commenced the course 57 successfully graduated, with most securing full-time employment. In total, 33 competencies were delivered to each participant over the course of the program.

Education


Junior Future Classroom

Spinifex State College Develop a media classroom for students to gain exposure to multimedia technology

2008–10 Spinifex Future Classroom has been fully functional since early 2009. 2010 funding enabled the school to update and improve the technology resources and continue subscription to important educational software.

Socialandcommunitydevelopment


Mount Isa Safe Community Project

Mount Isa Safe Community Action Team (MISCAT)

Assist MISCAT’s application to the World Health Organisation to gain endorsement of Mount Isa as an international Safe Community

2007-09 Due to a delayed commencement to the program in 2007, the partnership continued in 2010.During the year MISCAT and the St George Institute facilitated the first community-based short course in Injury Prevention and Safety Promotion and held an Abstract Writing Workshop. MISCAT worked closely with a number of action partner groups and participated in community events to promote the safety programs implemented under the safe community banner.

Brilla Brilla Breakfast Program and community centre upgrade project

NWQICSS Fund a daily breakfast program at the Brilla Brilla Community Centre at yallambee Reserve, and assist with improvements to the Community Centre’s kitchen and laundry

2008–10 Healthy breakfasts were supplied to an average of 15–20 children five days a week, and around 20 lunches were prepared daily. Please refer to the case study on page 67 for an update on this partnership.

Riverbed Action Group Burke Street Interventions Centre

NWQICSS Provide ongoing diversionary initiatives to combat issues associated with alcohol and substance abuse

2008–10 During 2010 the Interventions Centre ran a 16 week Alcohol and Other Dependencies (AOD) program with eight clients graduating from the program.All graduate clients are participating in follow up aftercare programs or have an open offer to enter this aftercare program.



Environment


Native animal and wildlife care program

North West Wildlife Carers Group

To fund supplies for registered carers in the north west region to assist them to nurse and rehabilitate injured wildlife

2008–10 A variety of native animals including 73 kangaroos, wallabies and over 100 birds were cared for by the North West Wildlife Carers Group.The Group educated the broader community about the importance of native animals in our ecosystem by conducting regular visits to schools and community groups.

Riversleigh Fossil Project

University of New South Wales

To help fund a number of collaborative educational, environmental and research initiatives into the geological and palaeontological resources of the Riversleigh Fossil Trail near Lawn Hill National Park

2008–10 Riversleigh fieldwork resulted in the discovery of a Diprotodon skeleton, the largest marsupial ever to have lived on earth, among other findings. The skeleton will be excavated during 2010–11. Xstrata funding has continued the development of the Xstrata Fossil and Mineral Trail and has helped PhD student Mira Van Der Ley commence her doctoral project focused on the Lawn Hill area of north west Queensland. Lectures and presentations about Riversleigh Fossils were given by researchers and numerous scientific papers produced.

Health


SimMan and SimBaby artificial simulators (medical mannequins)

Mount Isa Centre for Rural and Remote Health; and the Royal Flying Doctor Service (RFDS)

Provide local and regional health professionals with training in the diagnosis and implementation of advanced medical procedures

2008–10 Five Mount Isa District Advanced Life Support (ALS) refresher courses were held. Outreach trips with the RFDS continued and a new training session incorporating Xstrata Mount Isa Mines’ Rescues team and the Queensland Ambulance Service was held. Paediatric Grand Rounds and mock scenario sessions for Queensland Health staff continued, and the appointment of a Mount Isa Health District Coordinator has increased nursing participation in these training activities.

Diabetes Centre and education program

Queensland Health Funding towards a centre that provides modern diabetes management including a diabetes educator for outlying Indigenous communities

2008–10 Mount Isa Diabetes Service continued to provide advice on diabetes management and provided approximately 1,200 free consultations to diabetes sufferers in the Mount Isa community. The diabetes outreach clinic continued visits to the Indigenous communities of Mornington Island, Doomadgee and Normanton.A gap analysis was undertaken for the current service delivery resulting in increased focus and education on gestational diabetes. Xstrata’s support has enabled the purchase of equipment including sharps, containers and lancets.

Equipment upgrades Laura Johnson Home To support the region’s only aged care facility to upgrade its existing equipment and furniture

2008–10 Xstrata’s funding has enabled the home to upgrade the bathrooms in the high care wing and to purchase an additional shower trolley.In early 2010 work was completed on beautifying a courtyard area at the home as an in-kind support initiative between the Xstrata Skills Centre, Building Services Group and Community Relations.

Mount Isa Dental Health Building

Queensland Health To support the construction of a dedicated dental health facility as part of the Mount Isa Hospital Redevelopment

2010–11 An official launch of the Mount Isa Hospital Redevelopment was held in June 2010. Construction of the Dental Health Building has commenced and is due for completion mid-2011.



66 XSTRATA COPPER NORTH QUEENSLAND66 XSTRATA COPPER NORTH QUEENSLAND


The Brilla Brilla Breakfast Program is addressing the issue of poor nutrition and low literacy levels in Indigenous children living in the yallambee community by serving daily breakfasts and providing a pathway to education for these children.

Around 10–20 Indigenous families are part of the yallambee Aboriginal Community living in the heart of Mount Isa. Many of these families are socially and financially disadvantaged which can include child neglect, lack of educational or employment opportunities, overcrowding as well as drug and alcohol abuse.

The Brilla Brilla Community Centre was able to reopen in 2006 after Xstrata funded repairs to the centre. This enabled the centre to restart daily playgroup activities for children living at yallambee, and in 2007 the centre started a program aimed at encouraging children from the yallambee community to regularly attend school.

Xstrata partnered with Centacare in 2008 to support this program that provides children from the yallambee community with breakfast, a shower, clean clothes and a packed lunch as well as transport to and from school, and supervision of homework in the afternoon before the children return to their homes. younger siblings not yet old enough to attend school are also benefiting with the meals, showers and clothes the program provides. Xstrata’s support also assisted with centre improvements including work on their kitchen, bathroom and laundry facilities.

Maryann Devine – Brilla Brilla Communities for Children Program Manager, said more than 36 children are directly benefiting from the program each day with notable results in their health, speech development and social skills.

“We have seen amazing changes in the children participating in this program since it began,” said Maryann.

“Over the period of the partnership, the health and literacy levels of the children in the yallambee community have improved remarkably with some children now entering their fifth year of the program and making excellent progress at school.

“In 2010 we had five children attend Prep, which is very positive in terms of their ongoing participation in the education system.

“Xstrata’s support is really helping to make a difference in the lives of these children,” she said.

Maryann Devine won the Minister’s Special Commendation Award at the 2009 Regional Achievement and Community Awards, where the Culture of Education Program which includes the Breakfast Program also won an award in the Regional Service Award category.

To date, Xstrata has provided $80,000 in funding to support the Brilla Brilla Community Centre and its Breakfast Program, and has committed an additional $15,000 to enable the program to continue in 2011.

Case study

Xstrata helps make a difference to the lives of Indigenous childrenSince 2006 Xstrata has supported the Brilla Brilla Community Centre and their Breakfast

Program that has seen outstanding results, with up to 36 children from the yallambee

community attending daily for a healthy breakfast and many of these children attending

school on a regular basis. Some of the children now live in the community but continue

to be involved in the program.

“ Over the period of the partnership, the health and literacy levels of the children in the yallambee community have improved remarkably with some children now entering their fifth year of the program and making excellent progress at school.”

Denise�Perkins�–�Centacare�employee,�assists�Delta�Jay�reid�(Peppi)�to�complete�a�puzzle�at�the�Brilla�Brilla�Community�Centre



Sustainable CommunitiesErnest Henry Mining

Stakeholder�engagement�and�consultationErnest Henry Mining (EHM) identifies its key stakeholders as:

■■ local pastoralists

■■ residents of Cloncurry and local business owners

■■ Ernest Henry Mining employees and contractors and organisations that represent these groups

■■ Traditional Owner groups in north west Queensland, including the Mitakoodi Juhnjular and Mayi people


■■ local, regional and national governments and their agencies


■■ local schools and other educational and training institutions

■■ local, regional, national and international media


■■ XCPPNQ partners.


■■ Conducting two Community Information Sessions in Cloncurry to share information on our operations and provide a forum for feedback from community members

■■ Holding a Business Stakeholder Briefing Session in June for local business owners and associated groups regarding the suspension of EHM’s shaft underground mine project and the Federal Government’s proposed Resource Super Profits Tax (RSPT)

■■ Holding an annual Open Day in September for community members to visit and tour EHM

■■ Holding an annual Neighbours Day in November to enable local pastoralists with property in the near vicinity of EHM to visit and tour EHM, hear an update on our operation and discuss issues that may affect their businesses

■■ Conducting a 360° Key Stakeholder Survey

■■ Distributing copies of the 2009 Xstrata Copper North Queensland Sustainability Report to employees, contractors and key stakeholders

■■ Publishing EHM’s fortnightly internal newsletter Zingari Express

■■ Distributing Xstrata North Queensland’s Mine to Market newsletter to employees, contractors and Cloncurry residents

■■ Holding tours of the EHM operation for local schools and for tourists in conjunction with local tourism groups

■■ Contributing articles and advertisements to various publications to inform community members of our activities

■■ Holding regular meetings with key stakeholders.

Community�feedbackThe 360° Key Stakeholder Survey conducted in October 2010 surveyed 12 Cloncurry residents. This research identified areas of concern facing the Cloncurry community, including:

■■ The future of the mine and town

■■ Unemployment and job opportunities

■■ The fly-in/fly-out nature of EHM

■■ Ongoing funding and support for local projects and businesses

■■ The cost of living in and travelling to/from Cloncurry

■■ An increase in crime and anti-social behaviour in Cloncurry.



Children�play�dress�ups�at�Cloncurry�Kindergarten�on�the�new�deck�area�that�was�constructed�with�funding�from�the�Xstrata�Community�Partnership�Program�North�Queensland�(XCPPNQ)�

An action plan considering each of these concerns will be developed and implemented during 2011.

The Community Attitudes Survey (CAS) conducted in 2009 identified four main areas of concern facing the Cloncurry community. During 2010 we continued to address the community’s concerns:

Waterproblems

EHM installed additional surface water management infrastructure on site to improve its ability to capture and control surface water and to reduce the risk of discharge events occurring. Further improvements will be made during 2011. These improvements will help protect natural waterways and aquatic environments and will also increase our water re-use capabilities on site. Please refer to the Environmental performance section from page 96 for more information on these and other improvements.

Unemployment

EHM continued to deliver the Graduate and Vacation Work programs and provided work experience opportunities for local students. We also expanded our Indigenous training and employment initiatives through various programs. Towards the end of the year we commenced the recruitment process for six new locally-based apprentices to commence employment at EHM in 2011. Through the XCPPNQ we continued to support the Cloncurry Shire Council and its Community and Economic Development Advisor role.

Fly-in/fly-outworkforce

In 2010, EHM offered improved incentives for locally-based employees to help attract more people to live and remain in Cloncurry. Please see the case study on page 52 to read about these incentives.

FutureofEHMandtown

EHM advanced its shaft underground mine and magnetite processing projects during 2010. Please see the case study on page 27 for more information on these projects. We also continued to support the Cloncurry Community Precinct project by providing $750,000 under the XCPPNQ.

Corporate�Social�Involvement�programIn 2010 the XCPPNQ supported 10 initiatives in Cloncurry with a program value of $665,000. Details of these partnerships are located in the community partnership table on page 72.

In addition, EHM invested $196,898 in 2010 on sponsorships, donations and other community support initiatives in Cloncurry (see pie graph below). A selection of our

sponsorships and donations in 2010 included support for the Cloncurry and District Agricultural Show; Cloncurry Stockman’s Challenge; Curry Merry Muster Festival; Australian Festival of Chamber Music’s Community Concert; a new prep playground at St Joseph’s Catholic Primary School and a rail history display facility to be constructed by the Cloncurry Historical Society at Mary Kathleen Memorial Park. Funding was also provided to support the purchase of new equipment for Cloncurry Authentic Taekwondo Club and Cloncurry Scouts.

We also completed maintenance work and repairs at the Cloncurry Recreation Grounds; loaned equipment to Cloncurry PCyC to assist with fundraising activities; provided materials required for the installation of the new prep playground at St Joseph’s Catholic Primary School; performed electrical maintenance works at Cloncurry Blue Care; and provided funding towards trees planted at Cloncurry Cemetery as part of National Tree Day.

Community�grievancesNo community complaints were recorded at Ernest Henry Mining in 2010.

TotalCSIexpenditurebytype–EHM



� development

9%� Education

12%� Environment

4%� Health


XCPPNQexpenditurebytype–EHM



� development

8%� Education

15%� Environment

5%� Health


Sponsorships,donations,in-kindcommunitysupport–EHM



� development

12%� Education

1%� Environment

1%� Health




Karen�Elphick�–�Manager�Community�Development�at�Cloncurry�Shire�Council,��hosts�a�meeting�at�Cloncurry�Shire�Hall.�

Karen’s�position�has�been�funded�by�EHM�under�the�Xstrata�Community�Partnership�

Program�North�Queensland�(XCPPNQ)�from�2008–10

Indigenous�rights�and�Aboriginal�cultural�heritageThere were no known incidents of Indigenous rights being violated in 2010 and we recorded no breaches of Aboriginal cultural heritage. We conducted a series of Aboriginal Cultural Heritage surveys under the Aboriginal Cultural Heritage Act 2003 Duty of Care Guidelines in 2010. Through this process a number of artefacts and sites were identified and we will continue to engage the traditional custodians in relation to these.

A Cultural Awareness Training Package was scheduled for roll out in 2010. This has been deferred to 2011 so that the program can be reviewed and refined. During 2010 we recruited seven local Indigenous employees into the Indigenous-specific employment and training pathway, Structured Training and Employment Projects Employment Related Services (STEPers). We also awarded one National Indigenous Cadetship Support Program place to a local Indigenous tertiary student.

Mine�closureEHM continued to revise its mine closure strategy in 2010. Studies continued into the potential impacts of closure on the local groundwater resource and the stability of waste rock dumps and the tailings dam in the long term.

EHM continued working with its pastoral neighbours in 2010 to progress its bore census on properties surrounding the operation’s lease so that potential impacts on groundwater can be measured and managed on these properties.

The Mine Closure Plan was reviewed in 2010 and updated to reflect the latest closure strategies developed in response to EHM’s ongoing groundwater studies and revegetation, tailings capping, and evaporation trials. It was also updated to incorporate plans for underground mining and magnetite processing.



Rachelle Rub – Manager, Cloncurry Justice Association Inc. said the funding support from EHM was allowing this important service to continue.

“Cloncurry Night Patrol helps to protect people in our community by keeping some out of harm’s way and by stopping others from entering the justice system,” said Rachelle.

“We’re really appreciative of the funding we’ve received from Ernest Henry Mining as we wouldn’t be able to operate as successfully as we do without this support,” she said.

In 2010 alone, the Cloncurry Night Patrol assisted 756 youth (18 years and under), 625 adult males and 446 adult females – 1,827 people in total.

Cloncurry Night Patrol has received much recognition since it commenced. The Cloncurry Justice Association received a Certificate of Achievement for the project at both the 2007 and 2008 Cloncurry Australia Day Awards; Federal Member for Kennedy, Bob Katter, then awarded the project with an Achievement Award following its recognition on Australia Day; and in 2010 the Queensland Ambulance Service and Cloncurry’s local Ambulance Committee awarded the Cloncurry Night Patrol with a Certificate of Appreciation during local Ambulance Week for its community service efforts.

Our Community Attitudes Survey conducted in 2009 identified concern within the local community about anti-social behaviour in Cloncurry such as drug use, domestic violence, public drunkenness and youth wandering the streets. In response to this, EHM provided $40,000 in sponsorship to the Cloncurry Night Patrol in December 2009 to enable the service to continue in 2010. The Cloncurry Shire Council also provided $10,000 in funding at this time – in addition to the car already provided – to support the initiative in partnership with EHM.

In 2010 we conducted a stakeholder survey that again identified the community’s concern about drug and alcohol abuse and antisocial behaviour, along with an increase in crime. We use feedback from surveys to help us strengthen our stakeholder relationships and to guide us in responding to community concerns. At the end of 2010, we announced our commitment to supporting the Cloncurry Night Patrol by providing $136,000 over two years (2011 and 2012) under the Xstrata Community Partnership Program North Queensland (XCPPNQ).

This funding will assist Cloncurry Night Patrol to operate two nights per week for the next two years so that it can continue assisting people and help to reduce crime in the community. It is hoped that this partnership will assist the project to secure additional funding so that it can expand and provide a long-term service in Cloncurry.

Cloncurry Night Patrol is a project coordinated by the Cloncurry Justice Association. Commencing in 2007 as a community intervention project, it aims to maintain peace and prevent harm within the Cloncurry community, with a focus on assisting in the reduction of people passing through the Criminal Justice System.

Cloncurry Night Patrol staff drive around patrolling the streets on weekends between 10pm and 5am, and on other nights when there is a large event being held in the community. The patrol aims to help children and youth in particular, and works to decrease the number of young people on the streets late at night, reducing associated criminal activities in the process. It also assists adults engaging in alcohol or substance abuse and other anti-social behaviours within the community and drives home those deemed most as ‘at risk’.

Cloncurry Night Patrol is supported by the local police and the local taxi service. Detailed records are taken during each shift on the number of people the service assists. This can include anything from domestic violence assistance to Criminal Justice System diversion, cautioning regarding anti-social behaviour, suicide intervention, diffusing community fights and mediation.

Local business owners and residents have expressed their appreciation for the Cloncurry Night Patrol. However, the service relies on funding support to continue its work. It uses a car donated by the Cloncurry Shire Council for patrol activities and receives some in-kind and financial support from local businesses, and State Government funding supported the project in 2007. In 2009 the project ceased operations for six months due to a lack of funding.

Case study

Ernest Henry Mining supports Cloncurry Night Patrol

At Ernest Henry Mining (EHM) we aim to contribute to the sustainable social

development of Cloncurry, and we are committed to ensuring Cloncurry is a safe

and enjoyable place to live and work.



Cloncurry�Night�Patrol�staff�Charles�Hill,�Ben�Olesen�and�rachelle�rub�with�the�Cloncurry�Night�Patrol�vehicle�

Education


Tuckshop and Information Technology (IT) upgrades

Cloncurry State School Funding to support and encourage healthy eating and to enhance the school’s IT learning environment through improved facilities

2008–10 The school completed tuckshop renovations to create a more modern facility and to enable the school to provide a healthy breakfast for students. The school purchased and installed three Short Throw Multi Media projectors and bought 10 DSI Lite Consoles with educational games for use as a behaviour management strategy.

Computer and IT upgrades

St Joseph’s Catholic Primary School

Funding to enhance the school’s IT learning environment

2008–10 The school installed a new alarm and public address system along with a new phone system connecting the administration area with all classrooms to improve safety and communication across the school grounds.

Indoor/outdoor play area improvements

Cloncurry Kindergarten

Funding to improve kindergarten play areas and learning environments

2008–10 The kindergarten purchased a range of educational resources to replace outdated equipment and to comply with mandatory criteria and guidelines expected of early childhood centres. A stage platform was also constructed in the outdoor play area, creating a new play space and providing additional seating.

Ernest�Henry Mining

Xstrata Community Partnership Program North Queensland projects



PCyC Sergeant and club programs

Cloncurry PCyC Funding to support the PCyC’s Sergeant position and associated club programs

2008–10 The PCyC developed and supported its boxing and youth Management Team programs with its members participating in various competitions and self-development activities during 2010. Two jumping castles and an inflatable ‘Slip ‘n’ Slide’ were purchased which are available for hire, creating additional revenue for the club. The PCyC also held a successful Sportsman’s Dinner fundraising event.

Health


Aged care and ward improvements

Cloncurry Multi-Purpose Health Service

Funding to help the Cloncurry Hospital make its aged care section more homely and to improve ward services

2008–10 The hospital purchased new furniture and equipment including three air comfort chairs, two low-back orthopaedic chairs and a chair that converts to a sofa bed for use by visiting family members. It also purchased a blanket warmer, a tonometer and bladder scanner, enabling it to provide services that were previously not available in Cloncurry.

Artandculture


Provision of musical instruments

Cloncurry State School Funding to support and develop the school’s instrumental music program

2008–10 The school purchased a bass guitar and an electric guitar along with a portable sound system, amplifiers, microphones and music stands to aid in rehearsals and public performances.



Enterpriseandjobcreation


Cloncurry Community and Economic Development Advisor

Cloncurry Shire Council

Funding for a Community and Economic Development Advisor

2008–10 This role has helped develop a Master Plan for a new Recreation Grounds and Equestrian Centre in Cloncurry and helped secure funding for the Cloncurry Community Precinct project, improvements at the PCyC Activity Hall and for a new Sport and Recreation Coordinator position within the Council. Since this role was established, the Community Development function has been given more emphasis within the Council, with a full-time and a part time staff member now employed and more growth expected in 2011.

Cloncurry Shire Hall and Library redevelopment project


Funding to support redevelopment of the Cloncurry Shire Hall and Library

2009–10 The Council held a Community Information Session in November to share concept designs for the Cloncurry Community Precinct project with the community. Positive feedback was received. Detailed designs will be shared with the community early in 2011 and construction is expected to commence during the year.

Environment


Public shade Cloncurry Shire Council

Funding to aid in the installation of shade structures at the Cloncurry Swimming Pool and at the local skate park

2008–10 Designs have been finalised for shade structures to be installed at the skate park in early 2011 in time for National youth Week celebrations.

Cloncurry beautification


Funding to beautify Cloncurry’s streets and recreation areas

2008–10 Delays were experienced in the design and approval stages however a plan of works was finalised in 2010 and work is scheduled to commence in 2011.

Clockwise�from�top�left:�Steve�de�Kruijff�–�Chief�Operating�Officer�Xstrata�Copper�North�Queensland�(left),�and�Myles�Johnston�–�General�Manager�Ernest�Henry�Mining�(right),�present�a�$750,000�cheque�to�Cr.�Andrew�Daniels�–�Mayor�of�Cloncurry,�with�Betty�Kiernan�MP�–��State�Member�for�Mount�Isa,�in�support�of�the�Cloncurry�Community�Precinct

Some�of�EHM’s�neighbouring�landholders�in�front�of�the�underground�portal�following�a�special�tour�held�as�part�of�Neighbours�Day�

Well-known�horseman�Ben�Hall�(‘Bibil’�Station,�Muttaburra)�completes�the�wet�work�phase�of�the�2010�Ernest�Henry�Mining�Cloncurry�Stockman’s�Challenge

Year�Ten�student�–�Jill�McGee,�plays�Cloncurry�State�School’s�new�bass�guitar�purchased�with�funds�from�the�XCPPNQ�in�support�of�the�school’s�instrumental�music�program



Sustainable communitiesTownsville operations

Stakeholder�engagement�and�consultationOur Townsville operations identify its key stakeholders as:

■■ residents of Townsville

■■ Xstrata employees and contractors, unions and other organisations that represent these groups

■■ Traditional Custodians – the Girambilbarra people


■■ local, state, and national governments and their agencies


■■ local schools

■■ local, regional, national, and international media


■■ XCPPNQ partners.


■■ Distributing The Townsville News, a bi-monthly newsletter, and 10 editions of the Mine to Market newsletter to around 500 key stakeholders

■■ Distributing Well @ Work healthy lifestyle quarterly newsletter to employees

■■ Conducting tours of the Townsville operations for students from local schools, engineering students, retired professionals and business people, personnel from other mining companies, and potential and existing customers of the Xstrata Technology Group

■■ Holding an annual Key Stakeholder Information Evening and Community Information Session to share information on our business activities

■■ Conducting a 360° Key Stakeholder Survey to gain feedback on issues of importance to the community and to determine where best to direct our future efforts.

Community�feedbackThe Community Attitudes Survey (CAS) conducted in 2009 identified five key areas of concerns facing the community and action plans were developed to address these concerns. We continued to address these in 2010.

Key areas of concern to Townsville residents were the Global Financial Crisis (GFC) and the resultant job losses, and unemployment in the community. Xstrata is addressing these concerns by maintaining employee levels at our Townsville operations, continuing delivery of the Graduate and Vacation Work programs, and providing work experience opportunities for local students in our operations.

Another area of concern was businesses in Townsville going bankrupt. Xstrata is addressing this issue by continuing to support local business, suppliers and contractors through our operations. Please refer to page 23 for more information on Xstrata’s policy in regard to using local suppliers.



Children�participating�in�activities�during�the�Xstrata�Annual�Children’s�Exhibition,�‘Play�Lunch’

A final issue of concern was law and order and although presently this is not a concern that Xstrata is addressing, we are committed to using stakeholder feedback to refine, where appropriate, our operational responses to these issues contained in the 2010 stakeholder engagement plan.

Corporate�Social�Involvement�programIn 2010, the XCPPNQ supported eight initiatives in the Townsville community with a program value of $153,000. A selection of these community partnerships is outlined in the table on page 76.

The Townsville operations also invested around $91,000 in 2010 on sponsorships, donations and other community support initiatives in Townsville (see pie graphs on this page).

This included goods and monetary donations to Wulguru, Stuart, Oonoonba and Garbutt State Schools; Books in Homes; Perc Tucker Regional Gallery; Reef HQ Turtle Hospital; Salvation Army Red Shield Appeal; Kith and Kin Association; Endeavour Foundation; Cootharinga Society; Alzheimer’s North Queensland Inc; OptiMIND Challenge; Australian Volunteer Coast Guards – Townsville Flotilla; involvement with new recycling initiative MobileMusters and continued participation in Planet Ark’s Cartridges for Planet Ark.

Community�grievancesXstrata Copper’s Townsville operations received no community complaints in 2010.

Left:�Xstrata�Greek�Fest�2010

Above:�Xstrata�Percival�Portrait�Award�Merv Sharkey�–�Manager�Commercial�and�Logistics,�Judge�Andrew�Sayers�from�Canberra�and�Tait Adams�subject�of�winning�artist�Ted May’s�portrait

Indigenous�rights�and�Aboriginal�Cultural�HeritageThe Girambilbarra people are the traditional custodians of the land on which we operate. In 2010 there were no incidents of Indigenous rights being violated, and no Aboriginal cultural heritage sites were disturbed by our operations during the year.

Mine�closureOur Townsville operations finalised preliminary closure plans for our copper refinery and port operations. These plans identify risks for operations, decommissioning and post closure, stakeholder identification and future engagement strategies, specific studies for completion, environmental monitoring requirements, forecasting of projects until closure to progressively rehabilitate sites and provide cost estimates for provisioning. These conceptual plans progress to detailed closure plans within three years of a site ceasing operations.

“ In addition to the XCPPNQ, the Townsville operations invested around $91,000 in 2010 on sponsorships, donations and other community support initiatives in Townsville.”

TotalCSIexpenditurebytype–Townsvilleoperations



� development

11%� Education

5%� Environment

9%� Health


XCPPNQexpenditurebytype–Townsvilleoperations



� development

6%� Education

4%� Environment

11%� Health


Sponsorships,donations,in-kindcommunitysupport–Townsvilleoperations



� development

20%� Education

5%� Environment

7%� Health




Townsville�operations

Xstrata Community Partnership Program North Queensland projects

Environment


Sustainable environmental practices

Hermit Park State School

Funding to further develop the school’s environmental program

2008–10 The school has created a ‘live reef’, a hydroponics garden and constructed a real life working comet windmill on school grounds. The windmill is used to pump water to the school’s toilet cisterns and sprinkling systems.

Education


Technology in the classroom

Wulguru State School

Developing ways to integrate technology into the curriculum using a variety of applications

2008–10 Since 2008, five Interactive Whiteboard systems have been provided to classes, and a LEGO Educational Program has been rolled out providing student resources and teacher curriculum support in the area of technology.



Drama and self development for young people

Lifeline North Queensland

Developing personal growth and enhancing self-esteem, decision making and social skills in young people

2008–10 The creative program was extended to the youth of Magnetic Island giving them an opportunity to workshop ideas in areas including song writing, movie making, music, design and theatre.

Friday Night Juniors

Townsville and District Rugby Union

Developing the local rugby union junior program

2008–10 Since 2008, player and team numbers have increased significantly with over 1,100 junior players and 44 teams now registered. The junior program is played in a positive, non-confrontational environment giving players opportunities to learn ball skills and teamwork participation.

Health


Emergency Health Equipment

Townsville Hospital Foundation

Funding emergency support equipment for the Hospital’s Emergency Department

2008–10 Vital equipment purchased includes a BARD portable ultrasound Bladder Scanner, Oxylog II ventilating machines, portable operating lamp and diagnostic sets.

Therapy Dogs Delta Society Australia – Townsville Therapy Dog Program

Funding to recruit, train and accredit dogs and their handlers to visit hospitals, aged care facilities, day respite centres, mental health care units and palliative care centres

2008–10 Our funding support has enabled Delta Townsville to expand its number of volunteer teams to 36, with an additional 16 teams accredited in 2010.

Artandculture


Live Theatre Tropic Sun Theatre Company

Support for the annual Shakespearean production

2008–10 Tropic Sun launched its 2010 program with a new name – Full Throttle Theatre – and a new direction. The company presented to Townsville audiences ‘Nocturnal’ – a dynamic and challenging theatrical experience featuring 34 local young, emerging and independent artists and theatre technicians to replace their Shakespearean piece.

Cultural treat Greek Fest Support for annual Greek cultural festival

2008–10 The 2010 Festival attracted a 27,000 strong crowd. The success of this partnership was recognised when the Xstrata Greek Fest was named by the Townsville City Council as the Community Event of the year at the 2010 Australia Day Awards Ceremony.



Two very lucky green turtles, Torres and Barnie have embarked on their new life in the Great Barrier Reef Marine Park after being nursed back to health at the Turtle Hospital.

Fred Nucifora, Reef HQ Aquarium Director said both turtles had recovered well following the special care and rehabilitation they had received at the Aquarium.

“We’re delighted that Torres and Barnie the green turtles are healthy enough to be released back into their natural environment,” he said.

“It’s fantastic for us to see first-hand how the hospital can benefit these protected and iconic species of the Great Barrier Reef.”

Torres was brought to Reef HQ in 2006 weighing a tiny 366 grams. After four years of rehabilitation, Torres weighed a healthy 45 kilograms and was fit for release. Torres grew faster and larger than green turtles of a similar age due to the optimal conditions provided at the Aquarium.

Barnie was admitted to the Turtle Hospital in April 2010 suffering from a range of health problems, but was rehabilitated and also released back into the Marine Park.

Both turtles are fitted with an acoustic tag that transmits a signal to local receivers across Cleveland Bay, Magnetic Island and other regional areas across the Marine Park. In addition, Torres has been fitted with a satellite tag where researchers and the public can follow his movements (visit www.reefhq.com.au).

Dr Mark Hamann, Principal Research Fellow and Senior Lecturer with James Cook University, said very little research had been conducted on turtle movements within the Marine Park, in particular released rehabilitated turtles, and turtles like Torres that had never been in the wild.

Xstrata Copper has donated more than $14,000 since 2009 to support the work of Reef HQ Aquarium’s Turtle Hospital, which won the New Tourism Development Award at the 2010 Townsville Airport North Queensland Tourism Awards.

Case study

Xstrata Copper supports Reef HQ Aquarium’s Turtle Hospital

The Turtle Hospital in Townsville provides a dedicated facility where

sick and injured marine turtles can be cared for and rehabilitated. It

plays a key role in raising community awareness about threatened

species and encouraging behavioural change that contributes to

nature conservation.

“ It’s fantastic for us to see first-hand how the hospital can benefit these protected and iconic species of the Great Barrier Reef.”

Injured�turtle�Torres�is�released�in�the�Great�Barrier�reef�Marine�Park�after�being�nursed�back�to�health�at�reef�HQ�Aquarium’s�Turtle�Hospital



Adi�Endro�–�Environmental�Advisor,�and�ryan�Francis�–�Graduate�Environmental�Advisor,�sample�water�at�Mount�Isa�Golf�Club,��adjacent�to�the�Xstrata�Mount�Isa�Mines�lease


Environmental performanceWe aim to preserve the health, functions and long-term viability of the natural environments affected

by our operations. In line with Xstrata Copper’s Sustainable Development (SD) Policy, we operate

according to industry-leading environmental norms and, where relevant, eliminate, mitigate or repair

the environmental impact of our operations.

Environmentalprotectionexpendituresandinvestmentsbytype–XstrataCopperNorthQueenslandDivision

Expenditure/investment category 2010

Capital $15,717,641

Clean up costs for remediation of spills 0

Environmental consultants/contractors $2,509,154

Environmental personnel – employees $2,723,356

Licences/liability insurance $751,436

Rehabilitation and decommissioning costs $469,639

Research and development $1,556,692

Treatment and disposal of waste* $5,371,179

Treatment of emissions $210,000

Monitoring and analysis equipment $1,043,361

Other operating expenses $3,613,005

Total $33,965,464

* The significant increase in expenditure compared to 2009 is due to ESP stockpiled material treatment.

EnvironmentalIncidentClassification

Incident Category Environmental impact

1 Negligible incident

2 Minor incident

3 Significant incident

4 Serious incident

5 Disastrous incident

The environmental management systems in place at our sites and operations are aligned with Xstrata’s Business Principles and SD Standards against which we regularly test our performance.

Our operations and projects must comply with norms that sometimes go beyond legal requirements. We have set robust targets for our operations in terms of carbon intensity, energy intensity, fresh water consumption in arid areas and sulphur dioxide (SO2) emissions.

We manage biodiversity-related risks and seek to minimise or mitigate any negative impact on biodiversity that may be caused by our operations.

Xstrata Copper is committed to its recycling business in North America. This extends the useful life of metals and helps to reduce electronic scrap, which is an increasing source of environmental concern and landfill waste.

When environmental incidents do occur we determine the cause and take steps to prevent recurrence. Xstrata Copper also plans and implements the closure of operations in a way that is consistent with its commitment to sustainable development and the prevailing regulation where our operations take place.

We believe that superior environmental management results in increased efficiency, lower risk and higher overall performance of our operations. It is also critical to maintain our social licence to operate.

We aim to minimise the environmental impacts of the Xstrata Copper North Queensland Division’s operations. We will achieve this by managing risks, seeking opportunities to avoid, minimise and mitigate impacts through the efficient use of natural resources, pollution control, waste management and biodiversity conservation.

In 2010, the Division invested almost $34 million on environmental protection, management and initiatives.

Environmental�incidents�and�complianceIn 2010 no Category 3 (significant) incidents occurred at any of the Xstrata Copper North Queensland operations.

Two prosecutions and fines were recorded in 2010 as a result of incidents that occurred in late 2008 and early 2009.

In July 2010, Xstrata Mount Isa Mines pleaded guilty in the Brisbane Magistrates Court to one charge under the Aboriginal Cultural Heritage Act 2003 and was fined $80,000 in respect of inadvertent damage to cultural heritage objects while a contractor worked to upgrade a road in Mount Isa in 2008. Draft internal Aboriginal Cultural Heritage and Land Clearance procedures had been developed in consultation with the Kalkadoon people and were being trialled when the incident occurred. The procedures were reviewed in the light of the incident and are now in place. We take the issue of protecting Aboriginal cultural heritage very seriously and deeply regret this incident.

In August 2010, Ernest Henry Mining did not challenge proceedings brought forward by

the Department of Environment and Resource Management in relation to stormwater discharges that occurred in early 2009. Ernest Henry Mining was fined $100,000, and no conviction was recorded.

The Xstrata Copper North Queensland Division has established environmental plans, management systems and procedures at its operations. Xstrata Copper reviewed and improved its ISO 14001-compliant environmental management systems through continually involving operational areas in its development, using feedback from the Xstrata SD Assurance Program, specialist audits, and other internal and external environmental benchmarking activities.


0

1,200

200

1,000

600

Greenhousegasemissions–XstrataCopperNorthQueensland†

813

811 85

1

80

8

788

’000s tonnes CO2-e

2006 2007 20102008 2009

800

400

Climate�changeAs established in Xstrata Copper’s SD Policy, we set targets to reduce our direct and indirect greenhouse gas emissions and work with governments, organisations and other groups to address climate change.

The Xstrata Copper North Queensland Division is committed to managing energy use and the emission of associated greenhouse gases. We recognise that the future impacts of climate change including increased regulation, higher energy costs, and physical impacts such as drought and flooding, present a risk to our operations.

We support a Climate Change Policy which leads to reductions in global emissions and introduces a carbon cost that is shared across the community. However, we believe that the policy must not prejudice Australian trade competitiveness causing the loss of Australian output and jobs simply to have the production and emissions move off-shore.

Carbonemissions

The Xstrata Copper North Queensland Division sets annual targets for energy and carbon intensity levels for each major operating area. The targets are set with the aim of reducing, where possible, intensity levels year on year. Energy efficiency improvement and awareness programs are run to highlight opportunities for actions to achieve these targets.

The amount of carbon emissions from our north west Queensland operations is heavily influenced by changing mineral properties and production rates. As ore grades decline, higher volumes of ore will need to be processed in order to recover equivalent amounts of contained metal. This increase in processing will increase the site’s energy consumption making continued reductions in carbon intensity and energy intensity a significant challenge going forward. Furthermore, the Ernest Henry mine is transforming from an open cut to underground mine in 2010–12 which will result in significant changes to energy use and related emissions. In 2010, the Xstrata Copper North Queensland Division’s total greenhouse gas emissions was 851,000 tonnes of carbon dioxide equivalents (CO2-e), an increase from the 2009 total of 811,000 tonnes of CO2-e.

Carbon intensity for the Division was higher during 2010, at 3.0 tonnes of CO2-e per tonne of contained metal compared to 2.9 tonnes of CO2-e per tonne of contained metal in 2009. This increase is due to an increase in mining activity (mainly at Ernest Henry Mining) relative to metal production in 2010 compared to 2009.

The Division’s total greenhouse gas emissions are comprised of direct and indirect emissions (please refer to the Energy use by source table on page 81). Direct emissions are those which are generated by on-site activities, such as driving a diesel powered truck. Indirect emissions are those which are generated by an external supplier that provides a product or service to the operation, for example emissions generated by a power station that supplies electricity to the site.

In 2010, the Xstrata Copper North Queensland Division’s direct emissions accounted for 333,000 tonnes of CO2-e of the total greenhouse gas emissions, compared to 309,000 tonnes of CO2-e in 2009. Indirect emissions accounted for 518,000 tonnes CO2-e of the total greenhouse gas emissions, compared to 501,000 tonnes of CO2-e in 2009.

EnergyThe Xstrata Copper North Queensland Division increased its total energy consumption in 2010 to 8.4 petajoules (PJ) compared to 7.9 PJ in 2009. Total energy consumption increased due to an increase in mining and mineral processing activity in 2010 compared to 2009.

“ We support a Climate Change Policy which leads to reductions in global emissions and introduces a carbon cost that is shared across the community.”

NationalGreenhouseandEnergyReportingSystem(NGERS)

Xstrata Holdings Pty Ltd was registered in accordance with National Greenhouse and Energy Reporting Act 2007 and our annual report was submitted to government in October 2010. The Xstrata Copper North Queensland Division’s activities are reported as part of the Xstrata Holdings Pty Ltd submission.

Prior to the introduction of the National Greenhouse and Energy Reporting System (NGERS), our operations collected carbon activity data and reported greenhouse gas emissions in our annual sustainability reports and annual submissions under the Australian Government’s Greenhouse Challenge Plus and the Energy Efficiency Opportunities program.

Due to the detailed and evolving mandatory reporting requirements of NGERS, we continue to review our existing data and reporting systems to improve data integrity and compliance. This process was applied to 2010 data in this report and has been retrospectively applied to previous years’ data. Changes to our GHG and energy data in this report is due to the way energy use for on-site generation of electricity is reported at Xstrata Mount Isa Mines. This has resulted in revisions to previously reported figures to now align with legislated Australian Government reporting requirements under NGERS. The changes at Xstrata Mount Isa Mines also results in a revision of Xstrata Copper North Queensland Division figures.

†� �2007–09�figures�have�been�restated�to�account�for�a�change�in�the�reporting�methodology�related�to�the�on-site�generation�of�electricity.

Environmental performance


0

12,000

2,000

10,000

6,000

Energyuse–XstrataCopperNorthQueensland^

8,10

0

7,9

00

8,40

0

7,30

0

7,4

00

‘000s GJ

2006 2007 20102008 2009

8,000

4,000

0

60

10

50

30

Energyintensity–XstrataCopperNorthQueensland^

GJ per tonne contained metal

2006 2007 2011*2008 2009

*�Target

40

20

2010

29 29 29

27

30 29

The Division’s energy consumption by source can be found in the table below.

Energy intensity was 29 gigajoules (GJ) per tonne of contained metal in 2010 consistent with the result achieved in 2009.

EnergyEfficiencyOpportunitiesProgram

Xstrata Holdings Pty Ltd is a participant in the Australian Government’s Energy Efficiency Opportunities (EEO) Program. Participants are required to assess their operations for energy saving opportunities and to publicly report on initiatives where the payback period for an initiative is less than four years.

The report for the 2009–10 reporting period, including details of the Xstrata Copper North Queensland Division’s EEO initiatives, is located on the Xstrata Mount Isa Mines website at www.mountisamines.com.au.

As part of the 2010 EEO program, we continued to engage the workforce in identifying and evaluating energy saving opportunities. Xstrata Copper’s north Queensland operations have identified a number of energy saving initiatives. These include the Parkside Solar Project at Mount Isa (see case study on page 85), diesel fuel filtering at Ernest Henry Mining and the optimisation of ventilation and refrigeration systems servicing underground copper mining at Mount Isa Mines. Details on each of these are included in the EEO public report referenced above. Work will continue to evaluate and develop business cases for cost effective and technically feasible EEO opportunities in 2011.

Energyusebysource(GJ)–XstrataCopperNorthQueensland

Consumption 2010

Direct

Coal 318,700

Coke 22,800

Diesel 2,264,000

Natural gas 2,655,800*

Other sources (other energy sources such as LPG, petrol, and oils and greases) 121,200

Indirect

Electricity 3,049,500

Total 8,431,900

* The increase in natural gas use from the figure reported in 2009 (1.4 million GJ) is a result of the 2010 figure now including the gas used to generate electricity on site. Prior to 2010, only the natural gas used in the processes (i.e. the smelters) was included in the reported figure.

recycled�water�is�pumped�to�a�spraying�unit�to�suppress�dust�on�the�run�Of�Mine�(rOM)�

pad�at�Ernest�Henry�Mining

^� �2007–09�figures�have�been�restated�to�account�for�a�change�in�the�reporting�methodology�related�to�the�on-site�generation�of�electricity.

0

6

1

5

3

Carbonintensity–XstrataCopperNorthQueensland^

tonnes CO2-e per tonne contained metal

2006 2007 2011*2008 2009

*�Target

4

2

2010

2.9 3.0

3.0

3.03.2

2.9



Water�managementEffective water management and conservation is critical to the long-term viability of the Xstrata Copper North Queensland Division. Our operations have taken an integrated approach to water management.

Our key focus is to minimise fresh water usage and maximise process water recycling and usage at our operations. Alternative water sources to fresh water used at our operations include harvested stormwater, underground mine dewatering, water recycled internally within plant areas, return water from tailings thickeners and tailings decant water.

BiodiversityBiodiversity and its management are of strategic importance to the Xstrata Copper North Queensland Division. We are committed to the integration of biodiversity conservation considerations into environmental and social decision making in the search for sustainable development outcomes.

0

15.0

2.5

12.5

7.5

Wateruse–XstrataCopperNorthQueensland

8.9

8.5

8.59.

39.5

GL

2006 2007 20102008 2009

10.0

5.0

In 2010 Xstrata invested in excess of $8.7 million at its north Queensland operations on a range of initiatives to further improve the management and reduction of emissions. Further information on these initiatives can be found throughout this section.

Our north Queensland operations do not emit ozone depleting substances.

Waste�and�tailings�managementXstrata’s Product Stewardship standard requires that all operations eliminate, reduce, reuse, recycle where practicable or responsibly dispose of waste generated. In line with this standard, the Xstrata Copper North Queensland Division has a waste management system that is continually evolving to suit the needs of operational areas.

At its core is a waste management contract for general waste and scrap metal collection based on a ‘polluter pays’ principle. Waste costs are distributed to departments according to the volume they generate. The incentive is that any money received through scrap metal recovery in their area is credited back to the department responsible for that area.

MaterialsThe Xstrata Copper North Queensland Division is committed to the efficient use of input materials and actively seeks opportunities for reducing input consumption. Material usage is recorded at our operations to ensure they can be tracked and managed responsibly. Where practical alternatives exist, hazardous materials are replaced by less hazardous products, to ensure the impact from our operations is reduced and appropriately managed on an ongoing basis. Consumption information is also used as part of the National Pollutant Inventory (NPI) and other reporting requirements.

EmissionsEmissions monitoring, control and impact reduction strategies are a major component of environmental management at the Xstrata Copper North Queensland Division. Each of our north Queensland operational sites are complemented with their own comprehensive network of dust monitoring systems. These systems are essential to minimise the impact of our activities on the environment and on the communities in which we operate.

Phil�Abel�–�Apprentice�Electrician,�and��robert�Van�ryt�–�Electrician,�recycle�fluorescent�light�tubes�using�a�Fluro�Disposal�Machine



Totalmaterialsusage–XstrataCopperNorthQueenslandDivision

ProductAnnual usage

Acetylene (m3) 4,823

Cement (t) 111,720

Coal (t) 11,802

Coke (t) 846

Flocculants (t) 496

Gelatin (t) 22

Grinding media (t) 15,772

Lime/limestone – other purposes

(t) 13,206

Limestone – flux (t) 8,760

Oils and greases – lubricating, hydraulic, cooling

(kL) 2,556

Oxygen purchased (not made on site)

(m3) 22,100

Silica (t) 32,956

Sodium carbonate (t) 60

Sodium hydroxide (t) 34

Sulphuric acid (t) 1,579

Thiourea (t) 28

Tyres used – large vehicles, heavy equipment

No. 431

Tyres used – light vehicle No. 2,529

Xanthates and other floatation reagents

(t) 1,774

Fuel consumed

Diesel (kL) 58,654

Kerosene (used but not combusted)

(kL) 15

LPG (kL) 322

Unleaded fuel (kL) 258

Wood (t) 184

Explosives

Explosives (t) 10,997

Majorwastestreamsanddisposal/treatmentmethods–XstrataCopperNorthQueenslandDivision

Waste type Amount Treatment methods

Recycled/reused

Batteries (t) 112 Recycled off site

Conveyor belt (m) 2,322 Repaired and reused on site

General/domestic waste (t) 36 Recycled

Scrap metal (t) 4,364 Recycled off site

Waste oil (kL) 885 Recycled off site

Spent electrolyte (t) 4,244 Recycled in Xstrata Mount Isa Mines’ electrostatic precipitator dust leaching plant

Waste sent to landfill

General waste – to landfill on site*

(t) 6,544 General waste at Xstrata Mount Isa Mines and EHM is disposed of in on-site landfills

General waste – to landfill off site*

(t) 138 General waste from the Townsville copper refinery, and some general waste from EHM is sent to off-site landfills

Hazardous wastes – disposed on site

(t) 10,927 Xstrata Mount Isa Mines maintains a regulated landfill; in which some of hazardous wastes generated on site, and by other Xstrata North Queensland operations is disposed

Scrap metal – to on-site landfill

(t) 268 Scrap metal that is unable to be reclaimed for recycling is disposed of in the Xstrata Mount Isa Mines regulated landfill

Mining wastes

Excavated materials, overburden and waste rock

(t) 16,782,266 Stored as per Department of Environment and Resource Management (DERM) requirements

Processing wastes

Tailings (t) 17,991,087 Stored as per DERM requirements

(t) 2,722,245 Recycled as underground fill in the copper operations at Xstrata Mount Isa Mines (includes tailings waste from the copper and zinc-lead concentrators)

* From 2010, general waste will be broken down into general waste disposed to landfill on site, off site, and recycled. This figure was previously combined.

Above:�Wild�camels�graze�alongside�the�Duchess�Highway�near�Mount�Isa

Left:�Townsville�operations’�Environmental�Advisors�check�the�copper�refinery’s�first�flush�and�stormwater�drainage�system

Landdisturbed(ha)–XstrataCopperNorthQueensland

2009 2010

Rehabilitation during the year 28 25

Total rehabilitation completed to date 160 185

Area disturbed during the year 23 39

Totalareadisturbed 3,155 3,266



Over the years, copper’s uses have multiplied, thanks to its unique combination of properties. Copper is both malleable and ductile, that is it can be shaped into a variety of forms, such as wire or thin sheets, and is a highly efficient heat and electrical conductor1. It is estimated that around 70% of all copper consumed is used for its thermal and electrical properties.

This versatility, combined with copper’s durability, makes it a key component of everyday life, from the coins in our pockets to the roofing of our homes and the power lines that provide us with electricity.

New uses are also constantly appearing as technology advances, whether in communications, computers or medicine. Furthermore its extensive use in ‘green’ technologies such as solar cells, water heating panels and electric vehicles, ensures that copper will continue to play a key role in a sustainable future.

Copper�and�healthCopper is essential to plant and animal life. As a micro-ingredient of many common foods, it plays a vital role in human health. Children suffering from a low copper intake can experience growth difficulties and weak bones while in adults a lack of copper can result in increased infections and heart and liver complaints.

According to the US Department of Agriculture, the recommended daily intake of copper for adults is 1–2 mg. This is typically obtained naturally through a balanced diet as copper is contained in foods such as milk, nuts and chocolate.

Copper also makes another important contribution to human health through its ability to destroy bacteria. Officially recognised by the US Environmental Protection Agency in 2008, copper and copper alloys can kill 99.9% of bacteria within two hours. As a result, copper is now increasingly used as a surfacing material in hospitals, helping to prevent the spread of the hospital-acquired infections that are one of today’s most significant healthcare problems.

The main organisation responsible for publicising information about copper uses is the International Copper Association (ICA). Since 2009, ICA has been chaired by Xstrata Copper Chief Executive Charlie Sartain and our company is committed to increasing awareness of the uses of copper.

Copper�and�sustainable�developmentCopper is one of the oldest metals known to man. It is estimated that around 80% of the copper that has been mined over the centuries is still in circulation as copper is 100% recyclable, one of its distinguishing features.

“ Copper is one of the oldest metals known to man. It is estimated that around 80% of the copper that has been mined over the centuries is still in circulation ...”

1 www.copperinfo.com

Lee�Kingdom�and�Glenn�Farley�–�Air�Quality�Controllers,�in�Mount�Isa’s�Air�Quality�Control Centre

Product�responsibilityXstrata’s SD Standards provide guidelines to ensure that the impacts and risks associated with our products and services are identified, analysed, evaluated and minimised. Material safety data sheets are completed for products and intermediaries, including products’ physical and chemical composition, risks to human health, handling, transport, storage and exposure control.

A number of initiatives are in place at our north Queensland operations to facilitate and encourage responsible product design, and use, reuse, recycling and disposal of our products. This has been achieved through continuous improvements in our emissions reduction, materials use, waste management and environmental management systems and strategies.

In 2010, there were no significant fines for non-compliance with laws and regulations concerning the provision and use of products across the Xstrata Copper North Queensland Division.



We are committed to a process of continuous, proactive environmental improvement. Emissions monitoring, control and impact reduction strategies are a major component of environmental management at our operations in north Queensland. In 2010 we implemented a solar panels initiative in Mount Isa that demonstrates our leadership in environmental performance.

The initiative involved the installation of 96 Solar PV systems that have 155 kilowatts of total generating capacity. The solar panels will provide renewable electricity supply to apartments in the Xstrata Parkside accommodation complex used by Xstrata Mount Isa Mines for employee and contractor accommodation. The panels will provide export power to the local electricity grid at times when the apartments are not occupied.

Pieter Swart, Environment Manager North Queensland said the installation of the solar panels highlights to Queensland communities the benefits of renewable energy.

“These solar panels provide clean energy for our apartment complex in Mount Isa and demonstrate the effectiveness of solar technology to communities in north west Queensland,” said Pieter.

“Other environmental benefits include reduced use of fossil fuel generated electricity, reduced carbon dioxide emissions and lower energy costs.

“Again, this highlights to our local community and other stakeholders our commitment to investing in renewable energy and the process of proactive environmental improvement,” he said.

The installation will have metering of power generated by the solar panels to provide quantifiable results. The data will also be used for community promotion of and education about solar energy. It is estimated that this initiative will reduce greenhouse gas emissions by 500 kilograms of CO2-e per day.

The solar panels initiative will be eligible to create renewable energy certificates in accordance with the Australian Government’s renewable energy target scheme. In this way the project is supported by government, as well as through policies to encourage solar installations on households such as solar feed in tariffs.

The installation of the solar panels was completed in December 2010 and will operate indefinitely. Xstrata invested more than $900,000 on the implementation of this initiative.

Case�study

Installation of solar panels in Mount Isa

Top:�Kevin�Lu�–�Electrical�Engineer,�and�Bruce�Valentine�–�Engineering�Superintendent,�inspect�a�section�of�the�solar�panel�installation�at��Mount�Isa�Mines’�Parkside�Accommodation

Left:�Solar�panel�installation�at�Mount�Isa�Mines’�Parkside�Accommodation



At Xstrata Mount Isa Mines, we recognise that the future

impacts of climate change including increased regulation,

higher energy costs, and physical impacts such as drought

and flooding, present a risk to our operations.

Environmental performanceMount Isa Mines copper operations

Environmental�challengesThe key environmental challenges for the Mount Isa Mines copper operations include:

■■ regulatory transition from the Mount Isa Mines Limited Agreement Act 1985, to the Environmental Protection Act 1994

■■ minimising emissions to air from the Mount Isa Mines copper smelter and dust from surface operations

■■ managing site stormwater according to HAZDAM requirements

■■ preparing for and reducing our contribution to climate change

■■ minimising fresh water consumption and maximising process water reuse

■■ planning for effective progressive rehabilitation

■■ minimising waste generation and maximising materials recycling.

Environmental�protection�expendituresSince taking ownership of the Mount Isa Mines operations in 2003, Xstrata has invested in excess of $275 million on over 220 environmental initiatives. In 2010, the Mount Isa Mines copper operations invested more than $29.4 million on environmental protection expenditures and investments.

Environmental�incidents�and�complianceIn 2010, the Mount Isa Mines copper operations recorded a total of 48 minor environmental incidents, of which 45 were considered Category 1 (negligible), and three of the incidents were considered Category 2 (minor). All incidents were investigated and corrective measures implemented to prevent recurrence. In 2010, no Category 3 (significant) environmental incidents were reported. Regulatory non-compliances associated with the environment were reported to the Queensland Department of Environment and Resource Management (DERM).

One prosecution that resulted in a fine of $80,000 was received by the Mount Isa Mines copper operations in 2010 due to an incident that occurred in September 2008. Please refer to page 79 for more detail.

Transition�from�the�Mount�Isa�Mines�Limited�Agreement�ActIn May 2008, the Queensland Government passed legislation to transition Xstrata Mount Isa Mines from the Mount Isa Mines Limited Agreement Act 1985 to the Environmental Protection Act 1994. The existing Mining Plan 2010–15 originally established under the Mount Isa Mines Limited Agreement Act 1985 will remain the guiding document for environmental management on site until the transition period expires and Xstrata Mount Isa Mines is provided with a new Environmental Authority beyond May 2011.

During the transition period Xstrata will work closely with the Queensland Government and other key stakeholders to implement the upcoming changes to our environmental regulation. Various studies were undertaken during this period to improve understanding of environmental conditions and to help develop new Environmental Authority conditions.

Mount�Isa�landscape



Climate�Change

Carbonemissions

In 2010, Xstrata Mount Isa Mines copper operations’ total greenhouse gas emissions was 482,000 tonnes of carbon dioxide equivalents (CO2-e), a decrease from the 2009 total of 491,000 tonnes of CO2-e.† Carbon intensity for the site remained at 2.3 tonnes of CO2-e per tonne of contained metal in 2010.

Our operations’ total greenhouse gas emissions are comprised of direct and indirect emissions (please refer to the Energy use by source table on page 88). In 2010 the Xstrata Mount Isa Mines copper operations’ direct emissions accounted for 193,000 tonnes of CO2-e of the total greenhouse gas emissions, compared to 207,000 tonnes of CO2-e in 2009.† Indirect emissions accounted for 289,000 tonnes CO2-e of the total greenhouse gas emissions, compared to 284,000 tonnes of CO2-e in 2009.†

Carbonemissionreductionthroughoperationefficiencies

The energy efficient 30 megawatt (MW) Xstrata Power Station (XPS) continues to be operated as a base load power station. Due to its higher efficiency compared to alternate power supplies, the XPS reduces indirect emissions by 65,000 tonnes of CO2-e each year. The XPS is being expanded to a capacity of 39 MW with the expansion project to be completed in the second quarter of 2011.

The Mount Isa Mines copper operations’ underground Pelton Wheel generator added 3,200 megawatt hours (MWh) of zero emissions electricity to the site’s power network in 2009. The generator acts as a small hydro power station, which recovers the potential energy from chilled water being piped 800 metres underground to cool the copper mine. Rather than using a pressure relief valve to dissipate the pressure in the pipeline, the pressure drives a turbine which in turn drives a generator. As a result we achieve an indirect emission saving of 2,000 tonnes of CO2-e annually.

Environmentalprotectionexpendituresandinvestmentsbytype–MountIsaMinescopperoperations

Expenditure category 2010

Capital* $14,708,000

Environmental consultants/contractors $2,089,656

Environmental personnel – employees $1,813,293

Licences/liability insurance $435,998

Rehabilitation and decommissioning costs $19,036

Research and development $1,371,342

Treatment and disposal of waste $4,936,329

Treatment of emissions $210,000

Monitoring and analysis equipment $727,988

Operating costs – other $3,124,302

Total $29,435,945

0

3.0

0.5

2.5

1.5

Carbonintensity–MountIsaMinescopperoperations^

Tonnes CO2-e per tonne contained metal

2006 2007 2011*2008 2009

*�Target

2.0

1.0

2010

2.3

2.3

2.2

1.9

1.8 1.

9

0

600

100

500

300

Greenhousegasemissions–MountIsaMinescopperoperations^

473 49

1

482

479

442

‘000s tonnes CO2-e

2006 2007 20102008 2009

400

200

† 2009 figures have been restated to account for a change in the reporting methodology related to the on-site generation of electricity.

Sulphur�dioxide,�a�by-product�of�the�copper�smelting�process,�is�transferred�

directly�to�the�Incitec�Pivot�Acid�Plant�via�a�dedicated�pipeline


* The majority of this expenditure was related to the Smelter Emissions Project and the tailings reclaim water line installation.



0

6

1

5

3

Freshwateruse–MountIsaMinescopperoperations

3.9

4.6 4.7

4.4

4.8

GL

2006 2007 20102008 2009

4

2

0

7,500

1,250

6,250

3,750

Energyuse–MountIsaMinescopperoperations^

5,30

0

5,30

0

5,10

0

4,4

00

4,20

0

‘000s GJ

2006 2007 20102008 2009

5,000

2,500

0

30

5

25

15

Energyintensity–MountIsaMinescopperoperations^

GJ per tonne contained metal

2006 2007 2011*2008 2009

*�Target

20

10

2010

25

24 24

18

17

21

Energyusebysource(GJ)–MountIsaMinescopperoperations

Consumption 2010

Direct

Coal 318,700

Coke 22,800

Diesel 511,000

Natural gas 2,370,500

Other sources (other energy sources such as LPG, petrol, and oils and greases)

77,100

Indirect

Electricity 1,840,100

Total 5,140,200

Left:�A�newly�installed�pump�system�at�Death�Adder�Gully�helps�to�reduce�stormwater�run�off�from�the�Mount�Isa�Mines�lease

Above:�ryan�Francis�–�Graduate�Environmental�Advisor�consults�with��Adi�Endro�–�Environmental�Advisor�over��bore�sample�readings

Percentageandtotalvolume(ML)ofwaterrecycledandreused–MountIsaMinescopperoperations

2009 2010

Total water used (includes potable, raw groundwater and recycled/process water)

19,100 19,833

Total water recycled or reused* 12,600 12,353

Percentage of water recycled and reused* 66 62

* Does not include the use of groundwater, however groundwater is included as part of the total water used.




EnergyIn 2010, the Mount Isa Mines copper operations had a total energy consumption of 5.1 petajoules (PJ) compared to 5.3 PJ in 2009. This decrease was primarily due to reduced consumption of natural gas and coal. Energy intensity remained stable in 2010 at 24 gigajoules (GJ) per tonne of contained metal, the same result we reported in 2009.

Water�managementFreshwatersupplyanduse

Fresh water consumed at the Mount Isa Mines copper operations is sourced from Lake Moondarra and Lake Julius. These two dams are used in combination to ensure fresh water supply to Mount Isa Mines as well as the Mount Isa community. Lake Moondarra reached 87% capacity in March 2010 and Lake Julius reached 100% in February 2010. Of the fresh water consumed in 2010, 100% was sourced from Lake Moondarra. In 2010, a total of 4,670 ML of fresh water was consumed by the Mount Isa Mines copper operations, including mining, processing and smelting operations. The water intensity figure for 2010 was 21.75 kilolitres per tonne of contained metal.

Surfacewater

Surface water in the Mount Isa Mines region flows into the Leichhardt River and then into Lake Moondarra approximately 15 kilometres downstream of the major site operations.

Water discharged off site is sampled and analysed; and results have been provided to the Department of Environment and Resource Management.

In 2010, approximately $4 million was spent on installing a new tailings reclamation line, enabling water that would otherwise be lost to evaporation in the tailings dams, to be reused as process water on site. Refer to case study on page 95 for more information. Other improvements to water management systems on site during 2010 have included cleaning out antipollution ponds, relining drains, and increasing stormwater pumping capabilities.

During 2010 there were no instances of stormwater discharging off site from copper mining or processing areas at the Mount Isa Mines site.

Significant improvements have been made across site over the past few years in order to maximise reuse of stormwater in the process water circuits. In particular, we have focused on improving stormwater management in areas associated with potential off-site discharge points. In 2010, the final stage of the Death Adder Gully (DAG) improvements was completed, including installation of a pumping system to enable water at the DAG weir to be pumped back into Barracks Dam, which forms part of the site-wide water management strategy.

BiodiversityThe Mount Isa Mines copper operations manage approximately 30,000 hectares (ha) of land on mining lease ML8058, for the copper and zinc businesses, within the Mount Isa Inlier bioregion and Australia’s tropical savannas. ML8058 is characterised by rugged, rocky hills and poor shallow soil. Low open woodland with Eucalyptus, Corymbia and Acacia species predominates, with a ground layer of Triodia species (Spinifex) which reflects the complex geology, infertile soil and semi-arid climate.

In 2010, 11 ha of land was disturbed by our Mount Isa Mines copper operations (see table below) for the construction of infrastructure and to support mine development. Opportunity for rehabilitation on ML8058 is limited because most areas currently disturbed are considered ‘active’ and are not available for rehabilitation. Numerous rehabilitation studies were progressed in 2010 to develop best practice rehabilitation techniques specifically tailored to the local environment.

During the year we continued biodiversity management planning comprising various projects and internal systems updates with outcomes from the ML8058 biodiversity study, which was finalised early in the year.

Effectsonlocalenvironment

As part of the biodiversity management planning in 2010, recommendations from the ML8058 biodiversity study were developed and will remain ongoing in 2011.

Biodiversity projects targeted key threatening processes for biodiversity on the lease and included development of a fire management plan, and a pest management plan. No known effects were identified on the Red Goshawk, which is listed as ‘vulnerable’ under national legislation and International Union for Conservation of Nature (IUCN) Red List. During 2010, areas of conservation significance were managed by existing land management systems. No disturbed areas were identified during the biodiversity study as being of conservation significance.

Management of sulphur dioxide (SO2) emissions forms part of the biodiversity strategy as SO2�fallout from the smelters can have a localised impact on vegetation. The introduction of the acid plant in 2000, owned and operated by Incitec Pivot, reduced SO2 emissions from the copper smelter by 78% during 2010.

Habitatsprotectedorrestored

The conservation significance of ML8058 has been interpreted with respect to the surrounding landscape, the conservation status of the species present and the potential and actual threats operating on the lease. Our copper operations are within a traditionally grazed area and confined to a minimal footprint. However there were some habitats identified during the 2009 biodiversity study which are deemed to be of conservation significance.

A Conservation Management Plan was developed in 2009 based on the outcomes of the study in relation to these regional ecosystems, and the plan was finalised and communicated to key stakeholders early in 2010.

Following the vegetation survey conducted as part of the biodiversity study, seeds were collected from a community of Eucalyptus nudicaulis trees. The conservation status of this species is being reviewed and may be classified as vulnerable. Seeds were propagated and distributed into the community during various environment events such as World Environment Day and Green Week.

Landdisturbed(ha)–MountIsaMinescopperoperations

2009 2010



Area disturbed during the year 23 11




0

2.0

0.5

1.5

1.0

AmbientPM10lead-in-air90dayaverageconcentrationsformonitoredsites

µg/m3

2006 2007 20102008 2009

Mount Isa Mines Limited Agreement Act level

MonitoringLocations

RSLMiles St

BSDRacecourse

Kruttschnitt Oval

0

240

40

200

120

Annual*sulphurdioxide(SO2)emissions–MountIsaMinescopperoperations

117^

134

44*

*

12213

0

‘000s tonnes

2006 2007 20102008 2009

160

80

*�� National�Pollutant�Inventory�(NPI)�reporting�year�was�1�July�2009�–�30�June�2010.

**��Please�refer�to�the�National�Pollutant�Inventory�(NPI) commentary�on�this�page�and�page�91�for�an�explanation�on�the�decrease�in�emissions�from�2009�to�2010.

^�� The�2008�fi�gure�has�been�restated�from�129�to�117�to�correct�a�previous�error.

EmissionsXstrata Mount Isa Mines is committed to a process of continuous proactive environmental improvement. Emissions monitoring, control and impact reduction strategies are a major component of environmental management.

In July 2007, Xstrata Mount Isa Mines established the Smelter Emissions Project to assess the feasibility to further improve the capture and treatment of emissions from the lead and copper smelters. In 2010, Xstrata invested in excess of $8.7 million on a range of initiatives to limit emissions as part of this project.

At Xstrata Mount Isa Mines we have a comprehensive SO2 and dust monitoring network to measure and manage the impact of emissions on the community.

The Air Quality Control (AQC) monitors 10 SO2 real-time monitoring stations located in the community to ensure that the smelters operate within accepted regulatory limits. These in turn direct operations at our Mount Isa copper and lead smelters and Incitec Pivot’s acid plant. No Mount Isa resident lives more than 1,200 metres from one of the real-time SO2�monitors.

There are also five high-volume dust samplers located throughout the community to monitor levels of respirable lead, cadmium and arsenic in the air. These high-volume dust samplers collect samples of PM10 and PM2.5; that is, particulate matter less than 10 and 2.5 microns in size respectively, which are then analysed at an external laboratory. Refer to the map on page 91 for monitor location.

Xstrata’s air quality monitoring system provides data which indicates that ambient 90-day average lead-in-air (PM10) concentrations in Mount Isa remained lower than the Mount Isa Mines Limited Agreement Act 1985 air standard during 2010. Ambient lead-in-air (PM10) concentration data for 2006–10 is shown in the graph on this page.

Dust generation is controlled primarily by regularly watering unsealed roads, keeping vehicle traffic volumes and speeds to a minimum and planning blasting to coincide with favourable weather conditions. Dust suppressant additives are also used at our operations and a road sweeper is used to maintain reduced levels of dust on the sealed road areas.

Annualsulphurdioxide(SO2)emissions

The annual average ground level SO2 concentration was recorded as 16 micrograms per cubic metre (µg/m3) in 2010 which has remained consistent with the 2009 average, and is an improvement on the 2008 average of 26 µg/m3. The 2010 result is well below the Mount Isa Mines Limited Agreement Act’s required level of 80 µg/m3.

Westerly winds have a significant impact on our Mount Isa operations. In 2010, the Mount Isa Mines AQC restricted copper smelter operations (including complete and partial shutdowns) for 889 hours, compared to 931 hours during 2009.

The copper smelter recorded SO2 emissions of 43,600 tonnes in the 2009–10 National Pollutant Inventory reporting year. The copper smelter has achieved a 487,000 tonne (92%) decrease on SO2 emissions (from 530,600 tonnes) since the acid plant was introduced in 2000.

NationalPollutantInventory(NPI)

The NPI is an initiative of the Federal Department of Environment, Water, Heritage and the Arts. The online database contains information relating to the emission of 93 substances from industrial facilities and diffuse (non-industrial) sources across Australia.

Lee�Kingdom�–�Air�Quality�Controller,�analyses�wind�and�weather�data�received�from�a�doppler�radar



The NPI does not measure emissions into the community itself and cannot be used directly to determine the potential impact of these emissions on the community and the environment.

Due to the proximity of Xstrata Copper and Xstrata Zinc’s mining, processing and smelting operations in Mount Isa, emissions are reported to the NPI as a single operational footprint. As a result, Xstrata Mount Isa Mines is comparable to the sum of multiple individual mines and industrial facilities listed on the NPI.

Xstrata Mount Isa Mines reported substantial decreases in five of the six emissions compounds to the NPI database for which it was the major contributor for the 2009–10 period. This included decreases in beryllium, arsenic, lead, antimony and sulphur dioxide. These decreases were due to an improved confidence in emissions estimates; a reduction in feed through the copper smelter; a focus on continuous environmental improvement; and an increase in the treatment of gas at Incitec Pivot’s acid plant, which takes sulphur dioxide gas from the copper smelter and turns it into liquid sulphuric acid. An increase in cadmium emissions was due to a change in the feed grade of the concentrates processed in the zinc-lead processing stream.

A summary of Xstrata Mount Isa Mines’ reported emissions for which it was the major contributor the previous year is outlined in the table on this page.

Information on the NPI and estimated on-site emissions at the source are available from www.npi.gov.au.

Emissionsreductionstrategies

A number of major projects are underway at Xstrata Mount Isa Mines to manage emissions as well as to assess the potential for impact from emissions, including the Smelter Emissions Project, and the Lead Pathways Study.

Smelter Emissions Project

Xstrata established a Smelter Emissions Project team in 2007 to characterise smelter emissions, identify opportunities to significantly increase the capture and treatment of emissions, and design and implement controls to realise those opportunities. As part of the Smelter Emissions Project, Xstrata Copper has been assessing the feasibility of and progressively implementing opportunities from over 120 emissions reduction initiatives.

Summaryoftopeightofthemostsignificanton-siteemissionsestimatesasreportedtotheNationalPollutantInventory(NPI)*

2009–10

% change to previous

year 2008–09


year 2007–08


year

Antimony (t) 5 -34% 8 -60% 21 -21%

Arsenic (t) 18 -54% 40 -37% 64 -15%

Cobalt (t) 9 -86% 68 83 37 290%

Copper (t) 28 -71% 95 -72% 338 -18%

Cadmium (t) 12 42% 9 -17% 10 144%

Lead (t) 118 -44% 209 -21% 263 -15%

Sulphur dioxide (t) 176,103 -33% 262,626 5% 249,131 19%

Zinc (t) 71 -70% 238 -25% 316 -30%

* The Xstrata Mount Isa Mines NPI report includes on-site emissions estimates for the copper and zinc-lead businesses in Mount Isa. Due to geographical location, George Fisher Mine and Handlebar Hill open cut (both zinc-lead operations) submit separate reports.

RSL Club, Barkly Highway

Erap St

Racecourse, Simpson St

Sunset State School

Qld Country Credit Union,Camooweal St

Outback at Isa

Kruttschnitt Oval

Incitec Pivotacid plant car park

FN Land,Fourth Ave

Parkside Flats, Railway Ave

Brett Ave

Opal St

Kookaburra St

Miles St

North

XstrataMountIsaMines

XstrataMountIsaMines

SO2�MonitorsDErM�Ambient�Metals�MonitorHi-Volume�Monitors



In 2010 Xstrata invested in excess of $8.7 million on a range of initiatives to limit emissions.

Smelter Emissions Projectactivitiesundertakenin2010

■■ Designed and constructed off-site trials of Isasmelt furnace feed port sealed feeder prototype

■■ Gas handling system condition audits and repairs

■■ Designed, constructed and installed new ventilation system and new matte spout hood on rotary holding furnace No.1

■■ Decommissioned 70 metre high 650 fan stack, and redirected emissions to 153 metre high main copper smelter stack

■■ Completed computational fluid dynamics study to investigate the feasibility of a new converter hood design

■■ Carried out improved sealing trials on converter No.2 – sealed opsis, pyro, rear flap and water cooled front panel

■■ Designed and installed gland boxes on converter crossover damper actuators

■■ Designed and installed proportional control system on converter crossover damper

■■ Carried out feasibility study for new hood and ventilation system on rotary holding furnace No.2 hood system

■■ Completed pre-feasibility study of central copper smelter control room

■■ Carried out Isasmelt throat sealing trials

■■ Designed Isasmelt throat seal, lance box seal, and combustion air addition system

■■ Designed and procured Isasmelt furnace feed moisture analyser

■■ Designed and procured camera system for smelter emissions monitoring

■■ Procured open path sulphur dioxide analyser for fugitive emissions monitoring

■■ Completed sealing and pressurisation of Isasmelt furnace control room

■■ Installed Isasmelt tapping floor air lock and locker room

■■ Modelled copper smelter emissions – Phase 2

■■ Modelled copper smelter and Incitec Pivot acid plant emissions

■■ Developed key performance indicators (KPIs) and worked with smelter operations to embed ‘Operational Best Practices for Reduced Emissions’.

In 2011, work will continue on assessing the feasibility of, and implementing opportunities to significantly increase the capture and treatment of smelter emissions.

Lead Pathways Study

In late 2006, Xstrata commissioned an independent Lead Pathways Study to examine potential sources of lead in the Mount Isa community from both naturally occurring minerals and those from mining operations.

The Lead Pathways Study is a comprehensive research program being conducted by the University of Queensland’s Centre for Mined Land Rehabilitation in collaboration with the National Research Centre for Environmental Toxicology.

The Study has three phases to enable us to better understand potential pathways of lead into the Mount Isa community through land, air and water.

We are committed to this study and we will continue to act on its recommendations and keep the Mount Isa community informed of the study’s progress.

Read more about the Lead Pathways Study in the case study on page 93 of this report.

Waste�and�tailings�managementAt the Xstrata Mount Isa Mines copper operations all non-salvageable waste is disposed of in line with our strict waste management systems and legislative requirements. In 2010, over 3.5 million tonnes of waste material was recycled. The major components being 2.7 million tonnes of tailings used as underground fill in the copper underground operation, 86,500 tonnes of reprocessed copper reverts, and 700,000 tonnes of copper slag from our copper smelter.

Other regulated wastes that were recycled include wastes such as oil (336 kilolitres), batteries (106 tonnes) and non-hazardous recyclable waste mainly being scrap metal (2,866 tonnes) as well as conveyor belt (2,322 metres). A large proportion of the scrap metal is exported to South East Asia for recycling.

There were no significant environmental spills at the Mount Isa Mines copper operations during the year.

Tailings at our copper operations are stored as per the Tailings Placement Strategy. Currently, tailings dams seven and eight store all tailings produced by the operations. These two active dams at Mount Isa are split into an eastern and western fan. Tailings deposition is alternated between the two on a regular basis to keep the fans moist to reduce the likelihood of dusting by wind gusts.

Left:�Andrew�Nielsen�–�Electronics�Technician,�inspects�an�SO2�monitor�located�within�the�Mount�Isa�community

Above:�Five�TEOM�dust�sampling�monitors�are�stationed�within�the�Mount�Isa�community

“ In 2010 Xstrata invested in excess of $8.7 million on a range of initiatives to limit emissions.”



In late 2006 Xstrata Mount Isa Mines commissioned the Lead Pathways Study to better understand the potential pathways of lead in the Mount Isa community.

The Lead Pathways Study is an independent research program being undertaken by the University of Queensland’s Centre for Mined Land Rehabilitation in collaboration with the National Research Centre for Environmental Toxicology. The study has three phases of assessing potential pathways of natural and industrial sources of lead in the Mount Isa community through land, air and water.

In October 2010, the Lead Pathways Study team invited homeowners in Mount Isa to participate in the Phase Two (Air) house dust sampling program. Local homeowners showed full support for the house dust sampling program with the project team receiving over 100 requests to participate.

The project team identified the required 44 properties in line with the Property Selection protocol, to ensure a broad variety of houses were sampled, and to ensure a geographic representation of houses from across Mount Isa.

Chief Operating Officer, Xstrata Copper North Queensland, Steve de Kruijff said it was great to see the Mount Isa community support this landmark study.

“Our aim is to ensure this independent study delivers a comprehensive analysis of potential pathways of lead into the Mount Isa community,” Mr de Kruijff said.

“The collected dust samples from each house will be assessed for lead levels and potential human health impacts in various parts of the house.

“An analysis of these dust samples will also be used to compare lead samples taken at various sites across our operations, as well as naturally occurring lead sources across the community,” he said.

In July 2009 the Lead Pathways Study released its Phase One (Land) report; finding that the risk to human health from historical mine sediment is low.

Despite this finding, Xstrata has invested around $2.7 million to remove over 160,000 tonnes of soil containing historical mine sediment from the Leichhardt River. Xstrata is committed to the Lead Pathways Study and will continue to act on its recommendations.

Xstrata Mount Isa Mines anticipates that the Phase Two (Air) report will be delivered in late 2011, and the Phase Three (Water) report will be delivered in mid-2011.

Case�study

Mount Isa homeowners support Lead Pathways Study

Xstrata takes the health and safety of the Mount Isa community

very seriously and understands the unique situation of mining

and smelting operations situated close to town amid an area of

naturally-occurring lead mineralisation.

Associate�Professor�Barry�Noller�collects�a�house dust�sample�for�analysis�from�Member�for Mount�Isa�–�Betty�Kiernan’s�residence



Totalmaterialsusage–MountIsaMinescopperoperations

ProductAnnual usage

Raw materials and consumables


Cement (t) 94,585

Coal (t) 11,802

Coke (t) 846

Flocculants (t) 378



(t) 6,638

Limestone – flux (t) 8,760


(kL) 1,483


(m3) 18,529

Silica (t) 32,956

Sodium carbonate (t) 60

Sodium hydroxide (t) 34


(No.) 217

Tyres used – light vehicle (No.) 2,184


(t) 1,513

Fuel consumed

Diesel* (kL) 13,243

Kerosene (used but not combusted)

(kL) 15

LPG (kL) 299


Wood (t) 184

Explosives


* In previous sustainability reports, ‘Diesel’ was reported as ‘Diesel non-transport’ and ‘Diesel transport’. From 2010, consumption will be recorded as one total amount.

Seepage from the tailings dam is captured in seepage ponds and pumped back to the tailings dam to prevent off-site discharges. Seepage to groundwater is monitored through a series of groundwater bores. Assessment of tailings’ chemical properties indicates that they are non-acid forming.

Visual operational inspections are regularly completed on the tailings dams and seepage ponds. External consultants undertake monthly and annual inspections of each of the tailings dam walls, and an annual inspection to assess the hydraulic and structural integrity of the dam.

At this time, tailings waste is recycled as much as possible as underground fill. Filling of stopes is vital to ongoing development of the underground mines. By using tailings material in the fill process, the volume of consumables such as cement is significantly reduced and is a good example of product stewardship in the business.

Two major research and development projects were initiated in 2008 to assess long-term closure options and potential environmental impacts from the tailings dams. These projects will be used to refine closure criteria for the dams to ensure that they are safe, stable and non-polluting in the long term.

Waste sludges generated at our operations generally contain economically viable concentrations of copper. These are stockpiled to dry and then re-processed through our processing plants to recover metal. If sludges are of no commercial value then they are deposited in a designated cell at the site’s licensed hazardous waste facility.

The table below identifies the major waste streams of the Mount Isa Mines copper operations and the disposal or treatment method for each.

Product�responsibilityA number of initiatives are in place at our Mount Isa Mines copper operations to facilitate and encourage responsible product design, and use, reuse, recycling and disposal of our products. This has been achieved through continuous improvements in our emissions reduction, material use, waste management and environmental management systems and strategies.

MaterialsWe are committed to the efficient use of input materials. As a result we are actively seeking opportunities to reduce input consumption.

Majorwastestreamsanddisposal/treatmentmethods–MountIsaMinescopperoperations


Recycled/reused

Batteries (t) 106 Recycled off site

Conveyor belt (m) 2,322 Repaired and reused on site

Scrap metal (t) 2,886 Recycled off site

Waste oil (kL) 336 Recycled off site


General waste (t) 5,163 General waste is disposed of in on-site landfills

Hazardous wastes (t) 7,584 Mount Isa Mines maintains a regulated landfill in which the majority of hazardous wastes generated on site are disposed where appropriate

Processing wastes

Tailings (t) 3,899,436 Tailings storage facility

(t) 2,722,245 Recycled as underground fill in the copper operations. Tailings waste is from both the copper and zinc-lead concentrators.

Copper reverts (t) 86,500 Recycled in the copper smelter

Copper slag (t) 700,000 Recycled in the copper concentrator

Refractory block (t) 1,800 Recycled

We believe that effective management of input materials makes good business sense as it reduces our operating costs and reduces the impact on natural resources. For example, a significant amount of cement is saved by using tailings in filling operations of the underground copper operations. Projects to improve the recycling and reuse of process water also have the benefits of a reduction in fresh water consumption, and potential flow-on benefits with respect to energy efficiency.



Case�study

Engineering a sustainable water supply at Xstrata Mount Isa Mines

“After the drought had eased, we continued the project because our findings demonstrated how much water we could save into the future,” he said.

The $4 million pump station and pipeline construction commenced in May and the pipeline was commissioned in September 2010. The new pump station is located at the south-eastern base of Xstrata Mount Isa Mines’ Tailings Storage Facility.

The pipeline feeds the reclaimed water back into the system to be used by the zinc-lead and copper concentrators. A flow meter at the new pump station measures the amount of water reclaimed by the new system. Fresh water consumption is also monitored using flow meters across the Xstrata Mount Isa Mines lease.

The eight kilometre long pipeline had to be laid over difficult and remote terrain to reclaim the water. Through an innovative design and the support of multiple local contracting companies and Xstrata personnel, the project has proved a great success, and highlights our commitment to proactive environmental improvement.

When severe water restrictions were about to be introduced in 2008 as result of drought conditions, Xstrata dedicated a team to investigating water saving opportunities across our Mount Isa operations.

Matt O’Neill – Mount Isa Copper Operations Infrastructure Manager, helped identify this water saving initiative and said it provided many benefits to both Xstrata operations and the local environment.

“One of the benefits of this project is that we don’t have to rely on Lake Moondarra as the sole provider of water supply in order to sustain our operations,” said Matt.

“The region’s Drought Management Plan would restrict our water allocation by 30% when dam levels dropped to critical levels.

As a result of this initiative, recycled water can now be pumped from the tailings dam back into our operations at a rate of up to 200 litres per second.

Adam Purkis – Acting General Manager Engineering Support and Major Projects, said the water recycling project, which reclaims processed water from the tailings dam for use in our operations, is expected to significantly reduce our copper operations’ fresh water consumption.

“The pumping station and pipeline is able to return 17 megalitres of reclaimed water per day,” said Adam.

“This significantly reduces the need for additional fresh water in the zinc-lead and copper concentrators and demonstrates our commitment to sustaining local resources,” he said.

Effective water management and conservation is critical to the

long-term viability of our business. The implementation of a

uniquely designed pipeline and pump station at the Mount Isa

site in 2010 demonstrates our commitment to leadership in

environmental performance.

Above:�The�new�pump�station�installed�at�Tailings�Dam�8�as�part�of�the�tailings�pipeline�project�to�reclaim�process�water



Environmental performanceErnest Henry Mining

Environmentalprotectionexpendituresandinvestmentsbytype–EHM


Capital �$19,800

Environmental consultants/contractors

�$419,498

Environmental personnel – employees

�$660,062

Licences/liability insurance �$287,762

Rehabilitation and decommissioning costs

�$432,847

Research and development �$185,350

Treatment and disposal of waste

$396,566

Monitoring and analysis equipment

�$93,084

Operating costs $449,308

Total $2,944,277

Environmental�challengesThe key environmental challenges at Ernest Henry Mining (EHM) include:

■■ maximising the efficient use of water

■■ improving stormwater management during high rainfall events

■■ modelling groundwater drawdown and recharge (post-closure)

■■ developing sustainable capping strategies for the tailings dam and waste rock dumps

■■ updating the Mine Closure Plan

■■ reducing EHM’s financial liability

■■ improving biodiversity and land use planning.

Environmental�protection�expendituresIn 2010 Ernest Henry Mining invested $2.9 million on environmental protection, management and initiatives.

Managingenvironmentalrisks

EHM continues to maintain its area specific environmental Aspects and Impacts Registers. These registers are used to monitor controls that are implemented to minimise environmental risks. They also identify where additional controls can be implemented to further reduce environmental risk at the mine. The main risks and controls identified in these registers are integrated into the budget planning process.

Continuousenvironmentalimprovement

In 2010, EHM continued to manage an Environmental Improvement Plan (EIP), which listed key environmental improvement initiatives developed from the Aspects and Impact Registers. An EIP is developed annually to encourage continual environmental improvement at our operation.

Our main focus during the year was further improving water use efficiency and the management of stormwater on site.

Megan�Moar�–�Environmental�Field�Technician,�conducts�surface�water�monitoring�at�Ernest�Henry�Mining



0

450

75

375

225

Greenhousegasemissions–EHM

224

201

246

23124

7


2006 2007 20102008 2009

300

150

0

0.06

0.01

0.05

0.03

Carbonintensity–EHM

Tonnes CO2-e per tonne ore processed

2006 2007 2011*2008 2009

*�Target

0.04

0.02

2010

0.03

0.03

0.02

0.02

0.02

0.02

Environmental�incidents�and�complianceEHM had no environmental incidents greater than Category 1 (negligible) in 2010.

In August 2010, EHM was fined $100,000 by the Department of Environment and Resource Management (DERM) as a result of an extreme rainfall event that occurred in 2009 that contributed to the release of stormwater that did not comply with the water quality limits in the EHM Environmental Authority Conditions (electrical conductivity (salinity) and sulphate levels were slightly above permitted limits).

There was one non-compliance with the EHM Environmental Authority licence conditions in 2010. This was related to an adjustment to a Financial Assurance bond required by DERM.

Climate�change

Carbonemissions

In 2010, EHM’s total greenhouse gas emissions was 246,000 tonnes of carbon dioxide equivalents (CO2-e) up from the 2009 total of 201,000 tonnes of CO2-e. Carbon intensity for the site in 2010 was 0.03 tonnes of CO2-e per tonne of ore processed, the same intensity as 2009.

EHM’s total greenhouse gas emissions are comprised of direct and indirect emissions (refer to the Energy use by source table on this page). In 2010, EHM’s direct emissions accounted for 124,500 tonnes of the total CO2-e greenhouse gas emissions, compared to 89,000 tonnes of CO2-e in 2009. Indirect emissions accounted for 122,000 tonnes of CO2-e of the total greenhouse gas emissions, compared to 112,000 tonnes of CO2-e in 2009.

As a proportion of total energy used, the ratio of diesel to power use increased in 2010. As the combustion of diesel produces less CO2-e emissions per unit of energy than the generation of power, this meant that while energy intensity increased, carbon intensity as a proportion of total production was stable. The increase in the proportion of diesel consumption was due to the need to go deeper into the pit (longer haul distance) to extract ore.

Clockwise�from�top:�Lil�Howarth�–�Environmental�Advisor,�conducts�an�Environmental�Audit�with David Tempany�from�Hastings�Deering�in�EHM’s�heavy�vehicle�workshopA�water�bird�at�EHMEHM’s�rehabilitated�south�waste�rock�dump



target by 9% with an average of 373 litres per tonne of ore milled. This was a 19% reduction on 2009 consumption.

In 2010, EHM consumed 3,687 megalitres (ML) of water from Lake Julius, which was only 56% of our 6,500 ML allocation.

Stormwatermanagement

After the extreme rainfall events of 2009, a number of stormwater management improvements were made including the construction of large sediment dams, the installation of pumping infrastructure and changes to on-site water management strategies.

Improvements completed in 2010 include:

■■ Redesign of the tailings evaporation dam to increase its stormwater retention capacity from being able to contain a one in 10 year 60 day rainfall event plus process flows, to a one in 100 year 60 day rainfall event plus process flows

■■ Alterations and maintenance of site drainage systems to improve the separation of clean and potentially mine impacted stormwater

■■ Development of a Storm Trigger Action Response Plan to provide guidance to site personnel in high rainfall/storm events

■■ Changes to water use priorities to further increase stormwater retention capacity and to reduce the potential mineral content of stormwater on site

■■ Installation of laser guidance systems on equipment used for progressive rehabilitation of waste rock dumps, to improve surface drainage and reduce the potential for percolation of rainfall into the dumps.

These improvements resulted in the successful capture and containment of 100% of stormwater on site in 2010 despite receiving 850mm of rain during the year against a region average of 485mm. Whilst EHM is authorised under its Environmental Authority to release stormwater from site, subject to compliance with strict quality criteria, full containment of all stormwater on site is considered a better risk management strategy for reducing potential impacts on the environment.

Groundwatermanagement

EHM continued to pump groundwater via dewatering bore 05 (DWB-05) from the eastern rim of the EHM pit. This dewatering process is necessary to ensure dry mining conditions and to maintain pit wall stability.

extend the mine life to 2024 by developing an underground operation, the EEO program was reinstated in late 2010, with an EEO workshop. A number of energy savings ideas were canvassed and a cost benefit analysis of these ideas will be completed in 2011. Those rated as delivering the most cost effective energy reductions will be implemented at an appropriate time.

Water�managementErnest Henry Mining’s primary water sources are groundwater pumped from the open pit, DWB05, and Lake Julius. A key focus for EHM is to minimise the use of Lake Julius water and maximise the use/reuse of ground, storm and process water.

Improvements in site water management processes not only reduces the consumption of water but also minimises any potential impacts from stormwater runoff from mine impacted areas.

LakeJuliuswateruse

In 2009, the consumption of Lake Julius water averaged 458 litres per tonne of ore milled. In 2010 EHM set an ambitious target to reduce this consumption by 10% to less than 410 litres per tonne of ore milled. Despite the mechanical failure of the dewatering bore DWB05 in August 2010 which impacted EHM’s ability to reach this target, we still managed to exceed this

EnergyIn 2010, EHM’s total energy consumption increased to 2.6 petajoules (PJ) compared to 2.0 PJ in 2009. This was due to increased mining (up 29%) and processing activity (up 23%) during the year. Energy intensity increased by only 4% (from 0.25 to 0.26 GJ per tonne of ore processed) despite a 29% increase in total material moved. This was primarily due to a large reduction in the ratio of overburden to ore removed from the open pit.

EnergyEfficiencyOpportunities(EEO)Program

Xstrata Holdings Pty Ltd, which incorporates the Xstrata Copper North Queensland Division, is a participant of the Australian Government’s EEO Program. Further information regarding this can be found on page 81 of this report.

EEO activity at EHM was suspended in 2010 due to imminent mine closure in 2011. However, when the decision was made to

0

4,500

750

3,750

2,250

Energyuse–EHM

2,20

0

2,0

00

2,60

0

2,4

00

2,60

0

‘000s GJ

2006 2007 20102008 2009

3,000

1,500

0

0.450

0.075

0.375

0.225

Energyintensity–EHM

GJ per tonne ore processed

2006 2007 2011*2008 2009

*�Target

0.300

0.150

2010

0.25 0.

26

0.200.

21

0.24

0.19

Energyusebysource(GJ)–EHM

Consumption 2010

Direct

Diesel 1,743,000

Other sources (other energy sources such as LPG, petrol, and oils and greases)

41,000

Indirect

Electricity 774,000

Total 2,558,000

“ Our main focus in 2010 was further improving water use efficiency and the management of stormwater on site.”



0

6

1

5

3

TotalLakeJuliuswateruse–EHM*

4.9

3.9

3.7

4.8

4.6

GL

2006 2007 20102008 2009

4

2

*�Previously�reported�as�fresh�water�use.

0

750

125

625

375

LakeJuliuswateruse–EHM

428 45

7

373

436

543

Litres per tonne ore milled

2006 2007 20102008 2009

500

250

0

100

80

40

Groundwaterreused–EHM

78 78

49

64

61

% groundwater reused

2006 2007 20102008 2009

60

20

0

100

80

40

Tailingsunderflowdensities–EHM

69 68

71

6564

% solids

2006 2007 20102008 2009

60

20

Pat�Windsor�–�Environmental�Advisor,�and�Jess�Naylor�–�Graduate�Environmental�Advisor,�inspect�vegetation�on�Ernest�Henry�Mining’s�rehabilitated�south�waste�rock�dump

In August 2010, due to a mechanical malfunction, this pump ceased operation. Dewatering has recommenced via sump pumps at various locations inside the pit. DWB-05 will be recommissioned in 2011.

An Environmental Impact Study (EIS) conducted in 1996 identified that dewatering activities were likely to have an impact on the surrounding environment. As a result, EHM developed a groundwater model and implemented a monitoring program to routinely measure water levels and quality in up to 64 bores surrounding the mine. The monitoring data is used to identify any changes that are occurring, or to predict any future potential changes to regional groundwater resources.

In 2009, a bore census commenced of all regional pastoralist bores that had the potential to be impacted by EHM’s dewatering activities. The data gathered from this census is used to improve the EHM groundwater model’s predictive capability to identify any potential long-term impacts. In 2010, improvements were made to the census process to obtain more detailed data and the census area was also extended to include pastoralist properties located further from the mine site. The groundwater model will be updated as new data becomes available. The information obtained from the model will be provided to local landholders and used for developing mine closure strategies in consultation with local stakeholders.

Reuse of groundwater

Groundwater pumped from the EHM pit is used during the ore concentrating processes and also for dust suppression around site. The mechanical failure of DWB05 restricted our ability to reuse groundwater during 2010, and while we didn’t achieve our target of 80% groundwater reuse we still used 49% of the volume pumped.

Tailings�densitiesAutomation of the tailings underflow pumps continued to provide consistency to tailings underflow densities in 2010. Increased tailings underflow densities results in less water consumed in processing and less contained within the mine’s tailings, which is eventually lost to evaporation.

During 2010, tailings underflow densities in the concentrator were maintained at an average, solids to water percentage of 71%, which exceeded the 2010 target of 70%.



EmissionsEmissions to air, land and water are closely monitored and results are communicated to the government through the National Pollutant Inventory (NPI) and to neighbouring properties on a regular basis.

EHM has a comprehensive copper concentration and dust monitoring network that measures emission levels in the vicinity of our leases. In 2010, EHM continued to monitor dust deposition rates and copper concentrations up to 15 kilometres from the mining leases. There are no residences located in this area and due to low rainfall and cattle grazing activities the background dust levels are normally quite high. Monitoring results are compared against the Department of Environment and Resource Management’s criteria in the EHM Environmental Authority.

Dust suppression techniques continued to be used at EHM. Water carts were utilised in the pit area and on unsealed roads, and spray systems were used on conveyors and stockpiles in the processing area. Water used for dust suppression is mainly sourced from pit dewatering activities. Effective dust suppression is important to maintain a safe work environment for our people.

NationalPollutantInventory(NPI)

Ernest Henry Mining reported to the NPI for the Australian financial year 2009–10 as per Federal Government requirements.

The NPI provides data on on-site emissions only and identifies potential hazards associated with listed substances. As a result of an increase in ore and waste tonnage, longer hauling distances and an increased rate of development in the underground mine, EHM saw an increase in emissions over the 2009–10 NPI reporting year from the previous year on nine reportable substances. Detailed information regarding EHM’s NPI performance can be accessed via www.npi.gov.au.

Waste�and�tailings�management

Wasterockandtailings

In 2010, EHM continued to characterise and selectively handle all waste rock from the pit. The aim of selective handling is to minimise any risks to ground and surface water from potential acid mine drainage. To manage these risks, any waste rock that is potentially acid forming is encapsulated within the

The underlying land tenure of the EHM project area, located in black soil plains country, is the Fort Constantine Pastoral Lease with over 100 years of grazing history. Only ephemeral creeks and rivers are found in the area surrounding our operation. The closest permanent water bodies include Chinaman Creek Dam 45 kilometres away and the ephemeral Cloncurry River, approximately 10 kilometres to the west of the mine site.

There were no species of significance listed under the International Union for Conservation of Nature (IUCN) Red List found on or in the immediate vicinity of the mining lease prior to disturbance. No new species of flora or fauna were identified in 2010.

EHM continued to undertake aquatic ecological health assessments at downstream locations, and results indicate that the ecological health of these locations remain in good condition.

Rehabilitation occurs on an annual basis by the University of Queensland’s Centre for Mined Land Rehabilitation (CMLR). EHM consults with CMLR on a regular basis regarding our rehabilitation practices.

Ernest Henry Mining’s biodiversity initiatives in 2010 included ongoing aquatic and rehabilitation monitoring.


There were no habitats protected or restored by, or adjacent to EHM in 2010. Our operation is located within a heavily grazed area.

Biodiversity�managementErnest Henry Mining manages an area of approximately 7,000 ha of land situated within the Gulf Plains Bioregion just north of the border with the North West Highlands Bioregion of Queensland. Defining areas based on biodiversity values is a complex process and involves the identification of geology, landforms, watercourses and floral and faunal communities and examining the subsequent interactions.

A Biodiversity Strategy, Operational Guideline, Biodiversity and Land Management Plan, and a Weed Management Plan have been developed as part of our progress towards Xstrata’s SD Standard for Biodiversity and Land Management. We are committed to developing and implementing scientifically sound technologies and procedures for the effective management and conservation of biodiversity in the rehabilitation of disturbed land to a planned post-completion use.

Our biodiversity commitments include:

■■ responsible stewardship of land under our management

■■ identification of biodiversity conservation opportunities

■■ involvement of community and relevant stakeholders in the management of identified biodiversity issues.

Megan�Moar�–�Environmental�Field�Technician�(left),�and�Lil�Howarth�–�Environmental�Advisor,�collect�animal�traps�at�EHM�as�part�of�the�feral�animal�management�program



Majorwastestreamsanddisposal/treatmentmethods–EHM

Waste type Amount Treatment method

Recycled/reused

General/domestic waste* (paper)

(t) 1 Recycled

Scrap metal (t) 1,245 Recycled off site by a scrap metal contractor

Waste oil (kL) 534 Collected and treated off site by licensed contractors


General waste – to landfill on site*

(t) 1,381 Disposal in a non-hazardous landfill on site

General waste – to landfill off site*

(t) 35 Disposal in a non-hazardous landfill off site

Mining wastes

Excavated materials, overburden and waste rock

(t) 16,782,266 Stored as per Plan of Operations

Processing wastes

Tailings (t) 9,180,989 Stored in a licensed facility as per Plan of Operations

* From 2010, general waste will be broken down into general waste disposed to landfill on site, off site, and recycled. This figure was previously combined.

centre of the waste rock landform. This rock is then covered with benign, competent waste rock on the outside surface of the waste rock landform. These landforms are also designed to shed surface water and thereby minimise any potential percolation of rainfall into the core of the dumps. When any area of the waste rock dump reaches its full design height, or areal extent, these areas are progressively rehabilitated with vegetation native to the region. All of these control measures combined greatly reduce any potential for acid mine drainage.

EHM continues to stockpile benign, competent waste rock to ensure sufficient material is available to complete construction of the waste rock landform and tailings dam to the required specifications.

EHM continued to manage tailings produced from our concentrator according to regulatory requirements. The tailings storage facility is audited annually by independent Registered Professional Engineer Queensland (RPFQ)

certified engineers to certify its environmental performance complies with all relevant regulatory requirements.

Two PhD studies being managed by the University of Queensland in cooperation with EHM continued in 2010. These studies are investigating the potential ‘Environmental Risks of Tailings Seepage in Naturally Mineralised Areas’ and ‘An examination of Options for Tailings Revegetation’, and we will support these studies through to 2013.

Generalwaste

General waste from EHM and our residential village is contained and disposed of on site in accordance with Environmental Authority conditions. Waste aluminium cans from the EHM village are donated to the local Lions Club for recycling. Other materials such as metal tin cans, cardboard and waste cooking oil are recycled. Scrap steel is collected, taken off site and recycled. Around 1,245 tonnes of scrap metal was recycled in 2010.

Landdisturbed(ha)–EHM

2009 2010



Area disturbed during the year 28


Regulatedwaste

Regulated wastes are removed from site by licensed contractors and transported to Townsville for recycling or disposal. Scrap tyres are disposed of within designated cells in the waste rock dumps.

Rehabilitation

Around 1,665 hectares (ha) of land has been disturbed by our operation. During the life of the mine, disturbed areas are progressively rehabilitated to match the surrounding landscape. In 2010, EHM rehabilitated a further 25 ha, bringing total land rehabilitated to date to 185 ha.

During 2010, the tailings capping trials continued, involving three trial plots 30 metres by 30 metres in surface area, two of which are store and release capping designs.

The objective of these trials is to determine the most effective cover design to minimise any potential post-closure environmental risks. During the year, we commenced a Tailings Revegetation trial to ascertain suitable tailings remediation. The objective of the field trials is to assess the physical constraints, water storage and salt stratification within the tailings profile with the use of different amending materials. This information can then be used for long-term modelling of tailings revegetation.

In 2011, EHM will continue to rehabilitate disturbed land on the waste rock landforms as it becomes available.

MaterialsA wide range of raw materials and other consumables are used at EHM. The table below shows the main materials consumed at our operations by weight or volume in 2010. There was a significant increase in cement use due to the advancement of the underground decline and construction of the magnetite plant and shaft sink. There was also an increase in diesel and electricity use as a result of more material movement and mill throughput.

Transporting�product,�goods�and�materialsIn 2010, there were no environmental incidents associated with the transportation of concentrate between EHM and the Mount Isa copper smelter.



decommissioning and rehabilitating areas affected by activities associated with mining and minerals processing are incorporated into long-term financial models. The main aspects requiring investigation include potential long-term impacts on local groundwater resources, the stability of the waste rock landforms and the tailings storage facility.

Current long-term predictions of groundwater drawdown have indicated that the evaporation rate of water from the open pit will have a limited impact on groundwater recovery post-closure. Accordingly, comprehensive plans are being developed to address social, labour, environmental and economic issues associated with closure. Throughout the life of an operation the closure plan, which includes environmental costing to achieve an agreed post completion land use, is updated to reflect resource models. Closure planning at EHM is well progressed with ongoing rehabilitation of waste rock landforms and long-term groundwater modelling.

The plan is reviewed annually and updated as required to reflect the latest closure strategies developed as part of our ongoing groundwater studies, revegetation, and tailings capping trials. As the underground development will extend EHM’s mine life through to 2024 these changes will be incorporated into the 2011 Mine Closure Plan.

Totalmaterialsusage–EHM

ProductAnnual usage



Cement (t) 17,135

Flocculants (t) 118


Lime/Limestone – other purposes

(t) 6,543


(kL) 1,050


(m3) 3,571


No. 214

Tyres used – light vehicle No. 345


(t) 261

Fuel consumed

Diesel (kL) 45,148

LPG (kL) 21


Explosives


Product�responsibilityEHM aims to reduce, reuse and recycle materials wherever practicable within its operations, including input, product and waste streams. In 2010 this included:

■■ the first production of magnetite (this change decreases the volume of tailings moving forward by approximately 25%)

■■ continuing the recycling of waste oil, scrap metal, printer cartridges, food metal tins, aluminium cans and batteries

■■ reducing the volume of plastic and metal five and 20 litre containers by buying coolant and lubricants in bulk

■■ completing an operational review of tailings management strategies

■■ implementing further site water management improvements to increase water reuse and recycling.

Projects scheduled for 2011 at EHM include increasing the magnetite recovery by installing an IsaMill in the concentrator, and evaluating tailings re-mining for magnetite and/or cobalt.

Mine�closure�planningEHM maintains a Mine Closure Plan which is reviewed periodically and includes closure cost estimates. The anticipated costs of

Left:�Pat�Windsor�–�Environmental�Advisor,�and�Jess�Naylor�–�Graduate�Environmental�Advisor,�inspect�vegetation�on�EHM’s�rehabilitated�south�waste�rock�dump

Above:�Lil�Howarth�–�Environmental�Advisor,�collects�data�for�EHM’s�Tailings�Columns�Trial




case�study

Stuart Creek Biodiversity Study

Xstrata Copper manages biodiversity-related risks and seeks to avoid, minimise or mitigate any negative effects on the regional biodiversity caused by our operations.

During 2010, the Townsville copper refinery commissioned consultants RPS Group to undertake a biodiversity assessment of Stuart Creek, which forms the catchment for the refinery. The assessment identified key biodiversity values and assessed the condition of the riparian vegetation and aquatic ecosystems of Stuart Creek near the refinery.

Stuart Creek is located within the Ross River Basin and provides an important biodiversity corridor due to its connectivity within the landscape. This creek is the last remaining fresh water system within the Ross River Basin that retains open estuarine connections, providing an important migratory breeding and nursery area for a variety of estuarine species.

Xstrata is committed to the integration of biodiversity conservation

considerations into environmental and social decision making in the

search for sustainable development outcomes.

A number of suitable monitoring locations were identified as part of the assessment, including upstream reference sites and test sites immediately adjacent to and downstream of the copper refinery. The study involved an assessment of the overall ecological health of the system. It looked at creek vegetation, with permanent photographic monitoring points established to visually monitor any changes in condition over time. Aquatic monitoring was undertaken as part of the study, which concentrated on the ecology and water quality of Stuart Creek. Incidental observations of native flora and fauna utilising the ecosystems of Stuart Creek were also recorded.

Kelly Malone – Health, Safety, Environment and Training Superintendent at the Townsville operations, said there were no species of significance identified.

“The Biodiversity Assessment of Stuart Creek resulted in the development of measurable biodiversity indicators that may be used for future impact assessments.

“It will also inform practical mitigation measures and solutions to assist Xstrata Copper in achieving its sustainable development objectives,” said Kelly.

The study highlights our commitment to managing biodiversity-related risks with clear linkages to Xstrata’s SD Standard 10 (regarding Environment, Biodiversity and Landscape Functions). The results of this inaugural assessment will provide a benchmark of condition as the basis for determining changes in the ecosystem health of Stuart Creek over time.

Above:�Casey�richardson,�Environmental�Vacation�Student,�and�Elizabeth�Hunnam,�Environmental�Advisor,�sample�water�quality��at�Stuart�Creek

“ The study highlights our commitment to managing biodiversity- related risks.”



Environmental performanceTownsville operations

Environmental�challengesThe key environmental challenges of our Townsville operations include:

■■ improving dust and stormwater management practices at our port operations

■■ improving stormwater management at our copper refinery and port operations

■■ integrating energy conservation practices within our operations to minimise our carbon intensity and carbon footprint

■■ minimising fresh water consumption and maximising process water reuse

■■ minimising waste generation and maximising materials recycling

■■ managing impacts on the surrounding environment in conjunction with continual growth.

In 2010, the Townsville operations invested almost $1.6 million on environmental protection, management and initiatives.

Environmentalprotectionexpendituresandinvestmentsbytype–Townsvilleoperations


Capital �$989,841

Environmental personnel – employees

�$250,001

Licences/liability insurance �$27,676

Rehabilitation and decommissioning costs

�$17,756

Treatment and disposal of waste

�$38,284

Monitoring and analysis equipment

�$222,289

Operating costs �$39,395

Total $1,585,242

Environmental�incidents�and�complianceIn 2010 there were no fines, penalties or prosecutions received by our Townsville operations, and we were fully compliant with government licence conditions. Our port operations achieved its 2010 target of zero Category 2 environmental incidents. At the copper refinery we did not achieve this target, recording two Category 2 (minor)environmental incidents during the year (detailed below).


The first Category 2 incident involved the failure of the lining within a process wash water bund, which allowed process wash water to leak into communication conduits, and then feed into a sediment pit within the site’s internal drainage system. The process water was contained within the internal drainage system and no off-site discharge occurred. There was no regulatory exceedance resulting from this incident.

Elizabeth�Hunnam�–�Environmental�Advisor,�checks�the�ambient�real�time�dust�monitor�for�shipping�activities�at�Xstrata�Copper’s�Townsville�port�operations



The second Category 2 incident was recorded when approximately 2,000–4,000 litres of electrolyte spilt due to a process hose clamp coming loose. Again, the entire spill was contained within the internal drainage system, and subsequently recovered and treated. No off-site discharge occurred, and no environmental impacts resulted from this incident.

Full incident investigations took place for both incidents and corrective measures were taken to prevent a recurrence.

Climate�change

Carbonemissions

In 2010, the Townsville copper refinery’s total greenhouse gas emissions was 121,000 tonnes of carbon dioxide equivalents (CO2-e) a slight increase on the 2009 total of 117,000 tonnes of CO2-e. Carbon intensity for the copper refinery in 2010 remained consistent with 2009 at 0.42 tonnes of CO2-e per tonne of contained metal.

The port operations’ total greenhouse gas emissions were 1,700 tonnes of CO2-e in 2010. They accounted for only 1.4% of the Townsville operations’ emissions and have remained at similar levels for the past five years.

The Townsville operations’ total greenhouse gas emissions are comprised of direct and indirect emissions. In 2010, the Townsville operations’ direct emissions accounted for 15,000 tonnes of CO2-e of the total greenhouse gas emissions, compared to 13,000 tonnes of CO2-e in 2009. Indirect emissions accounted for 106,000 tonnes CO2-e of the total greenhouse gas emissions, compared to 104,000 tonnes of CO2-e in 2009.

EnergyIn 2010, the Townsville copper refinery increased its total energy consumption to 723,000 gigajoules (GJ) compared to 671,000 GJ in 2009. This was due to an increase in the volume of copper anode processed through the refinery. In addition to the anode produced in Mount Isa, the refinery continued to process imported anode. The refinery had 4% greater production in 2010 compared to 2009.

A table detailing energy consumption by source can be found on page 106.

Energy intensity increased to 2.5 GJ per tonne of contained metal compared to 2.4 GJ per tonne of contained metal in 2009.

0

0.750

0.125

0.625

0.375

Carbonintensity–Townsvillecopperrefinery

Tonnes CO2-e per tonne contained metal

2006 2007 2011*2008 2009

*�Target

0.500

0.250

2010

0.42

0.42

0.42

0.41

0.4

6

0.43

0

150

25

125

75

Freshwateruse–Townsvillecopperrefinery

116

114

127

11011

7

ML

2006 2007 20102008 2009

100

50

0

150

25

125

75

Greenhousegasemissions–Townsvillecopperrefinery

114 117 12

1

9697


2006 2007 20102008 2009

100

50

0

12

2

10

6

Freshwateruse–Townsvilleportoperations

5.1

7.7

5.3

3.7

3.2

ML

2006 2007 20102008 2009

8

4

Elizabeth�Hunnam�–�Environmental�Advisor,�conducts�dust�deposition�monitoring�at�Xstrata�Copper’s�Townsville�port�operations



0

4,500

750

3,750

2,250

Energyuse–EHM

2,20

0

2,0

00

2,60

0

2,4

00

2,60

0

‘000s GJ

2006 2007 20102008 2009

3,000

1,500

0

0.450

0.075

0.375

0.225

Energyintensity–EHM

GJ per tonne ore processed

2006 2007 2011*2008 2009

*�Target

0.300

0.150

2010

0.25 0.

26

0.200.

21

0.24

0.19

The Townsville port operations’ energy consumption was 10,400 gigajoules (GJ) in 2010 up from 10,200 GJ in 2009 (please note that the 2009 report had incorrectly stated in the text that energy consumption was 10 GJ for 2009, when it was actually 10 terajoules (TJ), or 10,200 GJ. This accounted for only 1.5% of the Townsville operations’ energy consumption. The port operations’ energy is sourced from a combination of electricity and diesel and consumption levels have remained constant for the past five years.

Water�use�and�managementA number of key stormwater management initiatives were completed in 2010:

■■ The expansion of the Townsville copper refinery’s irrigation area. Currently, the refinery uses sustainable irrigation practices as a method of stormwater and extracted groundwater control as per our Environmental Licence conditions. In an effort to increase our capacity to deal with extreme rainfall periods we expanded our irrigation area by 13 hectares and installed two new travelling irrigators. Final commissioning of the irrigators will take place in 2011.

■■ Our port operations commissioned a study to identify options to improve the quality of the stormwater discharged from site. The study examined site characteristics, current water quality, desired outcomes and the current first flush capture system to provide an analysis of the options available. The Townsville operations consume potable water and are considered a small consumer of water in a regional context. Fresh water consumed at Xstrata Copper’s Townsville operations is sourced from the local supply system fed from the Ross River Dam. In 2010 potable water consumption at the copper refinery increased by 11% with a total consumption of 127 megalitres (ML) recorded.

Potable water use at our port operations decreased by 31% from 2009, with a total of 5.3 ML consumed in 2010. This is consistent with 2008 consumption as 2009 was an unusually dry year which resulted in increased potable water use.

Our Townsville operations put significant effort into capturing and reusing process water and stormwater where possible to minimise potable water consumption. The copper refinery used approximately 81 ML of captured stormwater and process water for irrigation.

Energyusebysource(GJ)–Townsvilleoperations

Consumption 2010

Direct

Diesel �5,500

Natural gas �285,300

Other sources (other energy sources such as LPG, petrol, and oils and greases) �2,400

Indirect

Electricity �429,800

Total 723,000

Bob�Griffin�–�Port�Operations�Coordinator,�inspects�the�Xstrata�Port�sump�system,�which�allows�capture�and�reuse�of�stormwater



Following the completion of the port operations’ eastern yard upgrade project in 2009 at a value of $2.4 million, stormwater metal concentrations have reduced by up to half that of pre-upgrade analysis results. The upgrade included the installation of the eastern yard stormwater controls for the tippler rail corridor, roof stormwater and side road water catchments.

In 2010, the Townsville copper refinery discharged approximately 941 ML of stormwater and our port operations discharged approximately 86 ML. This is a substantial increase on previous years which is attributed to record rainfall during the year.

BiodiversityOur Townsville operations had no significant regional effects on the environment in 2010.

An Environmental Management Plan for biodiversity and land management is in place for the Townsville operations along with a Weed Management Plan for the copper refinery.

Xstrata Copper manages an area of 1,100 hectares (ha) of land in the Townsville State Development Area. A significant percentage of this land is used for cattle grazing. The Townsville copper refinery

The port operations’ first flush stormwater and washdown water is captured using a comprehensive sump system. These waters are then treated for discharge and/or recycled to above ground storage tanks that are used to wash down conveyors, hoppers and chutes between changes of conveyed material. In 2010, 0.6 ML of water was reused at our port operations.

There are a number of stormwater controls in place at the copper refinery. These controls include first flush capture and treatment and storage dams. All stormwater from site goes through these controls prior to being discharged. The stormwater then drains across a flood plain area and a minor creek system that eventually makes its way to Cleveland Bay. Ongoing monitoring of the flood plain area and creek systems is undertaken and all results are forwarded to the Department of Environment and Resource Management (DERM).

Stormwater improvements at our copper refinery are investigated and implemented annually. At our port operations, stormwater is captured and treated in sumps before being discharged into the Port harbour located in Cleveland Bay. Water quality monitoring occurs at the four licensed discharge points and is provided to DERM for review.

encompasses approximately 90 ha on which there is no regular significant land disturbance or rehabilitation required.

Our copper refinery land is bordered by Stuart Creek, a permanent fresh water creek. An independent biodiversity assessment study of Stuart Creek was conducted in 2010 (see case study page 103). Weed management works were undertaken in 2010 with the clearing of 20 ha invaded predominately by Chinee apple (Ziziphus mauritiana) and Leucaena (Leucaena leucocephala). The cleanup of the 20 ha paddock was in accordance with our Pest Management Plan. Further work will be undertaken in 2011.

The Port of Townsville conducted biodiversity assessments in the port harbour on behalf of its users.

The International Union for Conservation of Nature (IUCN) Red List indicates that no species of biodiversity significance are located within or near our Townsville operations.


There were no habitats protected or restored by, or adjacent to, the Townsville operations in 2010. Both our copper refinery and port operations are located in industrial areas.

Elizabeth�Hunnam�–Environmental�Advisor�(right),�and�Casey�richardson�–�Environmental�Vacation�student,�conduct�groundwater�and�surface�water�monitoring�at�Xstrata�Copper’s�Townsville�copper�refinery



EmissionsDue to the characteristics of the materials being handled at our Townsville port operations, dust management is integral to minimising impacts from the operations on the local community and environment.

At the port facility we have two real-time ambient air quality monitors in place downwind of the shiploader. These monitors allow the assessment of our management practices for product loading and handling. Additional dust control measures in place at our port operations include enclosed product handling areas and moisture control. Recycled water is used to maintain product moisture.

During the year we continued to investigate and implement dust management strategies at our port facility. The investigation assessed dust suppression and management options for the train wagon tippler, the ship load out facilities and the bulk storage shed at the port facility. At the copper refinery, stack emission monitoring was conducted twice and full compliance for emission monitoring was achieved.

Majorwastestreamsanddisposal/treatmentmethods–Townsvilleoperations



Recycled/reused

Batteries (t) 0.15 Recycled


Scrap metal (t) 233 Recycled

Waste oil (kL) 13 Recycled

Spent electrolyte (t) 4,244 Reused in Xstrata Mount Isa Mines’ electrostatic precipitator dust leaching plant


General waste – to landfill off site

(t) 94 Landfill disposal

Hazardous waste – disposed off site

(t) 3,101 Disposed at Mount Isa Mines’ regulated landfill


Recycled/reused


Waste oil (kL) 2 Recycled


General waste – to landfill off site

(t) 9 Landfill disposal

Regulated waste (t) 242 Various off-site disposal and treatment facilities

Totalmaterialsusage–Townsvilleoperations

Product UnitAnnual usage


Acetylene (m3) 116

Gelatin (t) 22


(t) 25


(kL) 23

Sulphuric acid (t) 1,579

Thiourea (t) 28

Fuel consumed

Diesel (kL) 263

LPG (kL) 2


Waste�and�tailings�managementThe Townsville operations are guided by a Waste Management Plan that clearly defines the waste types that are generated at our operations and details the correct disposal methods and locations in accordance with Queensland Waste regulations.

The Waste Management Plan ensures that all regulated waste movement and disposal is tracked using Queensland Government waste tracking certificates. All potentially hazardous wastes are handled within a solids waste storage facility.

A number of waste streams are transported to Mount Isa Mines for disposal in regulated tailings dams or licensed landfill, but where possible recycling is conducted. A waste recycling program is a key component of the Townsville operations’ waste management system. The program includes glass, plastics, paper, cardboard, scrap metal, waste oil and spent electrolyte, which makes up a significant amount of the regulated waste

disposed off site. Spent electrolyte is reused at Xstrata Mount Isa Mines as an acid leaching agent for the copper smelter’s Electrostatic Precipitator dust leaching plant.

The table on this page identifies the major waste streams generated in 2010 at our Townsville operations.

MaterialsDue to the nature of the processes at the Townsville copper refinery only small amounts of input materials are required, as outlined in the materials usage table below.

Product�responsibilityPractices of recycling major by-products from various steps in the refining process continued in 2010. Approximately 728 tonnes of slimes by-product were sold within Xstrata for the recovery of precious metals.

Transporting�product,�goods�and�materialsIn November 2009, subsidence of a roadway caused the spillage of zinc concentrate into the harbour at our Townsville port operations. Significant incident recovery and remediation work was completed under the supervision of the Department of Environment and Resource Management. Ongoing monitoring and testing continued in 2010 to ensure any potential for environmental impacts are mitigated. An independent assessment found no significant potential environmental harm existed following the recovery actions.



Captured stormwater is used to irrigate pastures and produce fodder for cattle. This water is monitored to ensure it meets appropriate guidelines. An environmental assessment was completed in 2009 which confirmed that the soils across the irrigated areas have not been impacted and that the irrigation practices remain sustainable.

This report also reviewed the option of opening a second irrigation area immediately to the north of the main irrigation dam. A key driver for this investigation was to allow an increase in the land under irrigation, and to help improve the overall stormwater management process at the Townsville copper refinery. Following the investigation, Xstrata Copper decided to proceed with the upgrade.

Instead of relying on one irrigator in times of frequent rainfall events, the new Southern Irrigation Area has two irrigators that can work in tandem, which reduces the impact of plant breakdown. Additionally, the irrigation pump at the main irrigation dam has been upgraded to allow more rapid transfer of water between the two irrigation dams.

Increasing the capacity to sustainably irrigate Townsville’s copper refinery increases the ability to capture stormwater for reuse and decreases the chance of any potential uncontrolled releases of water and any resultant soil degradation. The Townsville region predominately contains sodic soils which have the ability to erode rapidly under such events. The current land use for the irrigation areas is grazing, so good soil stability is key to sustaining land use into the future.

“Overall this project allows greater capture of stormwater while maintaining control to prevent potential dam overtopping or unsustainable irrigation during high rainfall periods where capacity has historically been stretched and management needs more intensive,” said Rodney Cooper – Environmental Advisor at the Townsville operations.

Xstrata Copper invested $100,000 in the upgrade which included site preparation and service roads to allow ease of access during wet periods. The 2010–11 wet season has caused some delays in commissioning the system, which is due for completion in 2011.

Case�study

Townsville copper refinery’s sustainable irrigation expansion

The Townsville copper refinery currently uses a sustainable

irrigation method to manage site stormwater runoff and

extracted groundwater.



Above:�New�irrigation�equipment�was�installed�at�the�Townsville�coppery�refinery

Summary of key sustainability data


Economiccontribution 2008 2009 2010

Division revenue (USD $ million)Employee wages (AUD $ million)Division royalties, taxes and charges (AUD $ million)Corporate Social Involvement (including public infrastructure) (AUD $ million)Apprenticeships, scholarships and training (AUD $ million)

1,743297

62.63.1

12.1

913325404.114

2,20533458.1

1.713

Corporategovernanceandethics

Total value of financial and in-kind contributions to political partiesPercentage of security personnel trained in human rightsPercentage of suppliers and contractors screened on human rights

Nil100%

Nil

Nil100%

Nil

Nil100%

Nil

Ourpeople

Total workforceEmployeesContractorsTotal women employed

(No.)(No.)(No.)(No.)

3,5522,801

751404

3,5092,865

644420

3,9312,8871,044

422

Total employees covered by collective agreements Average hours of training per employeePercentage of employees hired from local area

(%)(No.)

49.988

Not recorded

52.1131

60.9

54.1138

60.6

FatalitiesTotal Recordable Injury Frequency Rate (TRIFR)Lost Time Injury Frequency Rate (LTIFR)Disabling Injury Severity Rate (DISR)Health and safety prosecutionsHealth and safety finesOccupational illnesses

(No.)

(No.)($)

(No.)

010

0.7123.8

NilNil12

08.30.9

138.8NilNil10

07.40.7

130.6NilNil19

Community

Community complaints (No.) 50 143 124

Environment

Direct energy use Total energy useEnergy intensityCarbon intensity

(PJ)(PJ)

(GJ per tonne contained metal)(tonnes CO2-e per tonne contained metal)

5.38.1292.9

5.07.9292.9

5.48.4�29

3.0

Direct greenhouse gas emissionsTotal greenhouse gas emissionsSulphur dioxide emissions Ground level sulphur dioxide concentration Copper smelter downtime

(CO2-e thousand tonnes)(CO2-e thousand tonnes)

(thousand tonnes)(annual average micrograms per cubic metre)

(hours)

32581311726

1,021

30981113416

931

3338514416

889

Total fresh water use*Total recycling and reuse of water

(GL)(GL)

8.9 8.512.6

8.512.3

Land disturbedTotal land rehabilitated (to date)

(ha)(ha)

13132

23160

39185

Category 3 (significant) incidentsCategory 4 (serious) incidentsCategory 5 (disastrous) incidents

(No.)(No.)(No.)

000

100

000

ProsecutionsFines

(No.) ($)

00

00

2$180,000

* Does not include dirty water from mine dewatering, or groundwater consumed.


Indicator Description Level Reference

Strategy & analysis

1.1 Statement from the most senior decision maker about the relevance of sustainability to the organisation and its strategy

p.2-3

1.2 Description of key impacts, risks, and opportunities p.5,15-17

Organisational Profile

2.1 Name of the organisation IFC

2.2 Primary brands, products, and/or services IFC

2.3 Operational structure of the organisation IFC

2.4 Location of organisation’s headquarters IFC

2.5 Number of countries where the organisation operates, and names of countries

IFC

2.6 Nature of ownership and legal form IFC

2.7 Markets served including geographic breakdown, sectors served, and types of customers/beneficiaries

p.22

2.8 Scale of the reporting organisation p.1

2.9 Significant changes during the reporting periods p.13

2.10 Awards received in the reporting period p.17

Report Parameters

3.1 Reporting period for information provided p.13

3.2 Date of most recent previous report p.14

3.3 Reporting cycle p.13

3.4 Contact point for questions regarding the report or its contents

IFC

3.5 Process for defining report content p.13

3.6 Boundary of the report p.13

3.7 State any specific limitations on the scope or boundary of the report

n/a No specific limitations

3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities

n/a -

3.9 Data measurement techniques, and the basis of calculations

n/a Did not substantially

diverge from the GRI indicator

protocols

3.10 Explanation of the effect of any re-statements of information provided in earlier reports, and reasons

n/a No re-statements of information

3.11 Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied

n/a No significant changes

3.12 Table identifying the location of the standard disclosures report

p.111–112

3.13 Policy and current practices with regard to external assurance

p.14

Governance, Commitments and Engagement

4.1 Governance structure of the organisation p.18

4.2 Indicate whether the Chair of the highest governance body is also an executive officer

n/a Refer to Xplc 2010 Sustainability

Report4.3 State the number of members of the highest governance

body that are independent, and/or non-executiven/a

4.4 Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body

n/a

4.5 Linkage between compensation and the organisation’s performance (including social and environmental performance)

n/a

4.6 Processes in place for the highest governance body to ensure conflicts of interest are avoided

n/a

4.7 Process for determining the qualification and expertise of Board members on economic, environmental, and social topics

n/a

4.8 Statements of mission or values, codes of conduct, and principles

p.15

4.9 Procedures for overseeing the identification and management of economic, environmental, and social performance

p.18

4.10 Processes for evaluating Board performance, particularly with respect to economic, environmental and social performance

n/a Refer to Xplc 2010 Sustainability

Report


4.11 Explanation of whether and how the precautionary approach or principal is addressed by the organisation

p.15

4.12 Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organisation subscribes or endorses

p.19

4.13 Memberships in associations and/or national/international advocacy organisations

p.19

4.14 List of stakeholder groups engaged by the organisation p.13,57,60,68,74

4.15 Basis for identification and selection of stakeholders p.57

4.16 Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group

p.57,60-61,68,74

4.17 Key topics and concerns raised through stakeholder engagement, and how the organisation has responded

p.57-58,61, 68-69,74-75

Economic indicators

EC1 Direct economic value generated and distributed p.22-23

EC2 Financial implications, other risks and opportunities for the organisation’s activities due to climate change

p.80

EC3 Coverage of the organisation’s defined benefit plan obligations

p.44

EC4 Significant financial assistance received from government p.25

EC5 Range of ratios of standard entry level wage compared to local minimum wage at significant locations of operation

p.43

EC6 Policies, practices and proportion of spending on locally-based suppliers at significant locations

p.23

EC7 Procedures for local hiring, and proportion of senior management hired from the local community

p.43,44,49,53

EC8 Development and impact of infrastructure investments and services provided primarily for public benefit

p.22-23,58,69

EC9 Understanding and describing significant indirect economic impacts, including the extent of impacts

Environmental indicators

EN1 Weight of materials used by weight or volume p.83,94,102,108

EN2 Percentage of materials used that are recycled input materials

Not material

EN3 Direct energy consumption by primary energy source p.80-81,88-89, 97,105-106

EN4 Indirect energy consumption broken down by primary source

EN5 Energy saved due to conservation and efficiency improvements

p.81,85,87, 90-92,97

EN6 Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements

EN7 Initiatives to reduce indirect energy consumption and reductions achieved

EN8 Total water withdrawal by source p.82,88-89,98,106

EN9 Water sources significantly affected by withdrawal of water

n/a No water sources significantly

affected

EN10 Percentage and total volume of water recycled and reused

p.82,88,98-99, 106-107

EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

p.89,100,107

EN12 Description of significant impacts of activities on biodiversity in protected areas and areas of high biodiversity value

EN13 Habitats protected or restored

EN14 Strategies, current actions, and future plans for managing impacts on biodiversity

EN15 Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk

EN16 Total direct and indirect greenhouse gas emissions by weight

p.80,87,97,105

EN17 Other relevant indirect greenhouse gas emissions by weight

Data is currently not recorded

EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved

p.80-81,85,87, 90-92

GRI indexThis table indicates where to locate information relating to GRI G3 indicators and principles

in this report or other publications.

fully reported partially reported not reported n/a = not applicable


GRI index


Environmental indicators

EN19 Emissions of ozone-depleting substances by weight p.82

EN20 NOx, SOx, and other significant air emissions by type and weight

p.90-91

EN21 Total water discharge by quality and destination p.89,98,106-107

EN22 Total weight of waste by type and disposal method p.83,94,101,108

EN23 Total number and volume of significant spills p.92,101,108

EN24 Weight of transported, imported, exported, or treated hazardous waste

p.83,94,101,108

EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by discharges of water and runoff

n/a No water bodies or habitats

significantly affected

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation

p.84,94,102,108

EN27 Percentage of products sold and their packaging materials that are reclaimed by category

n/a -

EN28 Value and number of significant fines and non-monetary sanctions for non-compliance with environmental laws and regulations

p.79,86,97,104

EN29 Significant environmental impacts of transporting products and other goods and materials

p.94,101,108

EN30 Total environmental protection expenditures and investments by type

p.79,86,96,104

MM1 Amount of land disturbed or rehabilitated p.83,89,101,107

MM2 The number/percentage of sites identified as requiring biodiversity management plans, and with plans in place

p.89,100,107

MM3 Total amounts of overburden, rock, tailings and sludges and their associated risks

p.82,92,94,101,108

Labour Practices and Decent Work

LA1 Total workforce by employment type, employment contract, and region

p.43-44,47, 48-49,54

LA2 Total number and rate of employee turnover by age group, gender, and region

p.43-44,47, 48-49,54

LA3 Benefits provided to full-time employees that are not provided to temporary or part-time employees, by major operations

p.44,48,53

LA4 Percentage of employees covered by collective bargaining agreements

p.43,45,50,54

LA5 Minimum notice period(s) regarding significant operational changes

p.43

LA6 Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor and advise on occupational health and safety programs

p.45,54

LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities by region

p.29-33,35-36, 38-40

LA8 Education, training, counselling, prevention, and risk-control programmes in place regarding serious diseases

p.29-40

LA9 Health and safety topics covered in formal agreements with trade union

p.43

LA10 Average hours of training per year per employee by employee category

p.47,49,54

LA11 Programs for skills management and lifelong learning p.43,45,49-50,53

LA12 Percentage of employees receiving regular performance and career development reviews

p.43,45

LA13 Composition of governance bodies and breakdown of employees per category according to gender, age group, minority group membership, and other indicators of diversity

p.47,49,54

LA14 Ratio of basic salary of men to women by employee category

p.43

MM4 Number of strikes and lock-outs exceeding one week’s duration by country

n/a No strikes or lock-outs

MM12 Approach to identifying, preparing for, and responding to emergency situations

p.31,32,35-36,39

MM13 Number of new cases of occupational disease by type. Programmes to prevent occupational disease

p.30,32-33,36, 39-40


Human Rights

HR1 Percentage and total number of significant investment agreements that include human rights clauses or human rights screening

n/a No significant investment

agreements in 2010

HR2 Percentage of significant suppliers and contractors that have undergone screening on human rights and actions taken

p.19

HR3 Employee training on policies and procedures concerning aspects of human rights

p.19

HR4 Total number of incidents of discrimination and actions taken

p.43

HR5 Operations identified in which the right to exercise freedom of association and collective bargaining may be at significant risk

p.43,50,54

HR7 Operations identified as having significant risk for incidents of forced or compulsory labour

p.19

HR8 Percentage of security personnel trained in policies or procedures concerning human rights

p.19

HR9 Total number of incidents of violations involving rights of indigenous people and actions taken

p.62,70,75

MM5 Total number of operations taking place in or adjacent to Indigenous Peoples’ territories, and number and percentage of operations or sties where there are formal agreements with Indigenous Peoples’ communities

p.62-63,70,75

Society

SO1 Nature, scope, and effectiveness of any programs and practices that assess and manage the impacts of operations on communities, including entering, operating, and exiting

p.57-77

SO2 Percentage and total number of business units analysed for risks related to corruption

p.18

S03 Percentage of employees trained in organisation anti-corruption policies and procedures

p.18

S04 Actions taken in response to incidents of corruption n/a No incidents of corruption

SO5 Public policy positions and participation in public policy development and lobbying

p.19

SO6 Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country

p.19

SO7 Total number of legal actions for anti-competitive behaviour, anti-trust, and monopoly practices and their outcomes

p.19

SO8 Monetary value of and total number of fines or non-monetary sanctions for non-compliance with laws/regulations

p.62,79,86,97,110

MM6 Number and description of significant disputes relating to land use, customary rights of local communities and Indigenous Peoples

p.62

MM7 The extent to which grievance mechanisms were used to resolve disputes relating to land use, customary rights of local communities and Indigenous Peoples, and the outcomes

p.57-77

MM8 Number (and percentage) of company operating sites where artisanal and small-scale mining (ASM) takes place on, or adjacent to, the site; the associated risks and the actions taken to manage and mitigate these risks

n/a No artisinal mining and small-scale

mining taking place

MM9 Sites where resettlements took place, the number of households resettled in each, and how their livelihoods were affected in the process

n/a No resettlement

MM10 Number and percentage of operations with closure plans p.94,102

Product Responsibility

PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures

p.82,84,94,102

PR3 Type of product and service information required by procedures, and percentage of significant products and services subject to such information requirements

n/a

PR6 Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship

n/a

PR9 Monetary value of significant fines for non-compliance with laws/regulations concerning the provision and use of products and services

n/a No fines

MM11 Programs and progress relating to materials stewardship p.82,84,94,102

fully reported partially reported not reported n/a = not applicable

GlossaryALABCAustralia-Latin America Business Council.

AQCAir Quality Control centre. The centre monitors sulphur dioxide emissions and weather conditions and directs the operations of the Mount Isa Mines smelters to control sulphur dioxide concentrations within license limits.

ARGAustralian Railroad Group.

ATSI Aboriginal and Torres Strait Islander.

AusIMMAustralian Mining Institute of Mining and Metallurgy.

AWAs Australian Workplace Agreements.

BiodiversityAn abbreviation of ‘biological diversity’ that means the variability among living organisms from all sources, including land based and aquatic ecosystems of which they are a part. These include diversity within species, and of ecosystems.

BusinessPrinciplesXstrata’s Statement of Business Principles sets out the ethical framework for the way we work globally. The statement sets out specific aspirations and commitments that apply to the company’s relations with its customers, employees, stakeholders, partners, suppliers and in the communities where it operates.

Carbonintensity Calculated as CO2-e tonnes per tonne of product.

CASCommunity Attitudes Survey.

ClosurePlanA formal document detailing a costed conceptual outline of how the operation will be completed, taking into account the options available to deal with prevailing social and environmental issues.

CMLRCentre for Mined Land Rehabilitation.

CO2-eCarbon dioxide equivalent is a standard metric by which greenhouse gases other than carbon dioxide are converted to CO2 equivalence to facilitate comparisons and quantification.

CommoditybusinessXstrata’s activities are structured into global commodity businesses organised along commodity lines.

CommunitygrievancesAny issue raised by a member of the community relating to the operation in question, whether resolved or not. This can relate to an enquiry or other incident or non-compliance.

CPRSCarbon pollution reduction scheme.

CRLCopper Refinery Limited.

CSICorporate Social Involvement.

Cu copper.

DAGDeath Adder Gully.

DEEWRFederal Government Department of Education, Employment and Workplace Relations.

DERMQueensland Department of Environment and Resource Management.

DISR–DisablingInjurySeverityRate= (LTI days lost + RWI days lost) x 1,000,000/hours worked in the reporting period.

DMPDrought Management Plan.

DPM–DieselParticulateMatter– consisting of small particles that aggregate to form chains to make larger particles which are usually less than one micron.

EBAsEnterprise Bargaining Agreements.

EEOEnergy Efficiency Opportunity.

EGRUEconomic Geology Research Unit.

EHMErnest Henry Mining.

EIPEnvironmental Improvement Plan.

EISEnvironmental Impact Statement.

EITEEmissions Intensive Trade Exposed.

EITIExtractive Industries Transparency Initiative aims to increase transparency in transactions between governments and companies within extractive industries.

EMESRTEarth Moving Equipment Safety Round Table.

EMPEnvironmental Management Program.

EMSEnvironmental Management System(s).

ERTEmergency Response Team.

ESIAEnvironmental and Social Impact Assessment.

ESLEnglish as a second language.

ETSEmissions trading scheme.

FatalityA death resulting from an occupational injury or disease/illness and identified within the reporting period.

FIFO Fly-in/fly-out (type of employee/contractor).

FeedOre entering the beginning of a unit process.

FreshwaterUntreated water extracted from ground water, dams or rivers.

GETGround Engaging Tools.

GFCGlobal Financial Crisis.

GFMGeorge Fisher Mine.

GHG–GreenhousegasAny gas that absorbs infra-red radiation in the atmosphere, causing the warming of the earth’s atmosphere.

GJGigajoules (1 GJ = 1,000,000,000 joules).

GlobalCompactThe UN Global Compact is a voluntary corporate responsibility initiative to advance ten universal principles in the areas of human rights, labour, the environment and anti-corruption.

GRI–GlobalReportingInitiativea multi-stakeholder, international process whose mission is to develop and disseminate globally applicable Sustainability Reporting Guidelines to assist corporations in reporting on the economic, environmental, and social performance of their operations.

H1N1 Influenza A virus.

ha Hectares (1 ha = 10,000 square metres).

HoursworkedTotal number of hours worked by employees in the reporting period, including overtime and training, excluding leave, sickness and other absences, including the total number of contractor hours worked on site during the year.

HPRIHigh Potential Risk Incident.

IBAIndigenous Business Australia.

ICAInternational Copper Association.

IEPIndigenous Employment Program.

ICMMInternational Council on Mining and Metals.

ISOInternational Standardisation Organisation.

ISO14001 The International Standardisation Organisation’s standard for environmental management systems.

ITEAsIndividual Transitional Employment Agreements.

IUCNInternational Union for Conservation of Nature.

JRCJob Role Criteria.

JSAJob Safety Analysis.

KgKilogram (1 kg = 1,000 grams).

kLKilolitre (1 kL = 1,000 litres).

KmKilometre (1 km = 1,000 metres).

kWKilowatt (1 kilowatt = 100,000 watts).

LanddisturbedLand disturbed by operational activities.

LandrehabilitatedLand disturbed by operational activities and then reshaped and revegetated.

LDPLeadership Development Program.

Localsupplier– a supplier from the nearest regional centre with proximity to our mining operations.

LPGLiquid petroleum gas.

LPSLead Pathways Study.

LSILife Styles Inventory.

LTI–LostTimeInjuryAn occupational injury or disease that results in days away from work on any rostered shift subsequent to that on which the injury occurred. A fatality is also recorded as an LTI.

LTIFR–LostTimeInjuryFrequencyRateLost time injury frequency rate = LTI x 1,000,000/hours worked in the reporting period.

M3Cubic metres.

MaterialityDisclosing all information of significant concern to stakeholders for assessing our economic, environmental, and social performance.

MCAMinerals Council of Australia.

MICCMount Isa Chamber of Commerce.

MICOMount Isa copper operations, consisting of the Enterprise and X41 underground copper mines and the copper concentrator.

MISCMining Industry Skills Centre.

MISCATMount Isa Safe Community Action Team.

MITAMount Isa Tourism Association.

MITEZMount Isa to Townsville Economic Zone.

MLMegalitre (1 megalitre = 1,000,000 litres or 1,000 kilolitres).

ML8058the Xstrata Mount Isa Mines mining lease.

MountIsaMinesLimitedthe copper and zinc-lead business operating on ML8058.

MRRTMinerals Resource Rent Tax.

MTIMedical Treatment Injuries – an occupational injury/illness which is not classified as an LTI or RWI, but which results in loss of consciousness or medical treatment after first aid.

MWMegawatt, a unit for measuring electric power, which has the value of 1,000,000 watts or 1,000 kilowatts.

MWhMegawatt hours.

μg/dlMicrograms per decilitre.

μg/m2/dayMicrograms per square metre per day.

NGERSNational Greenhouse and Energy Reporting System.

NGOsNon-governmental organisations.

NICPNational Indigenous Cadetship Program.

NISCNational Industry Skills Centre.

NNTTNational Native Title Tribunal.

NOHSCNational Occupational Health and Safety Commission.

NOxOxides of nitrogen (nitric oxide and nitrogen dioxide).

NPINational Pollutant Inventory. Australia’s national public database of pollutant emissions.

NWQIRIINorth West Queensland Indigenous Resource Industry Initiative.

NWQMPNorth West Queensland Minerals Province.

OccupationalillnessAn occupational illness is registered when it is confirmed as a work-related compensable case by a medical practitioner/physician.

OEMsOriginal Equipment Manufacturers.

OreA mineral-bearing rock from which metal can be extracted.

Oz Ounces.

ParticulateemissionsControlled discharges from stacks containing microscopic solids in the form of dust

or smoke.

PASSPositive Attitude Safety System.

PERReview Performance and career development review.

PJPetajoules (1 PJ = 1,000,000,000,000,000 joules).

PM10Particulate matter less than 10 microns in size.

PPEPersonal protective equipment.

QMEAQueensland Minerals and Energy Academy.

QMLQueensland Medical Laboratory.

QRCQueensland Resources Council.

RecycledwaterRecycled/re-used water is water that has been used at least once in a process within the operation or at another operation within the organisation; and that would otherwise be part of a waste stream; and if not re-used, would require the input of raw water.

RedListIUCN Red List of Threatened Species.

RehabilitationIn this report, rehabilitation is defined as disturbed areas that have been prepared for rehabilitation and seeded.

RFDSRoyal Flying Doctor Service.

RSPTResources Super Profit Tax.

RWIsRestricted Work Injuries.

SDSustainable Development.

SDStandardsA set of 17 Standards which set out corporate performance expectations for each operation and against which sites and commodity businesses are independently audited through the Xstrata SD Assurance Program.

SO2Sulphur dioxide.

STEPersStructured Training and Employment Projects – Employment Related Services.

StormwaterRainfall that does not infiltrate into the soil but runs overland into creeks, catchment areas or man-made water storage facilities, such as dams (i.e. unplanned discharge of water).

SWOSafe Work Observations.

TailingsandtailingsdamsThe fine fraction of waste rock remaining after the mining and on-site processing of mineral resources. Tailings are piped into engineered impoundments known as tailings dams.

t tonnes.

TARPTrigger Action Response Plan.

TELTownsville Enterprise Limited.

TMSTraining Management System.

TOTTownsville Ocean Terminal.

Townsvilleoperations– Townsville copper refinery and port operations.

TPUGTownsville Port Users Group.

TRIFR–TotalRecordableInjuryFrequencyRate= (LTI + RWI + MTI) x 1,000,000/hours worked.

TWLThermal work limit.

UNUnited Nations.

WastewaterdischargedTotal volume of effluent discharged to: surface water for irrigation; third parties for treatment; and rivers or oceans.

WBVWhole Body Vibration.

WHOWorld Health Organisation.

XCPPNQXstrata Community Partnership Program North Queensland.

XplcXstrata plc.

XPSXstrata Power Station.

XstrataMountIsaMinesXstrata Copper and Xstrata Zinc operations on ML8058.

XTXstrata Technology.

MIM1700 04/11

www.xstrata.com

Xstrata�Queensland�Limited ABN�69�009�814�019

GPO Box 1433 Brisbane Queensland Australia 4001 Tel +61 7 3295 7500 Fax +61 7 3295 7640

Mount Isa Mines Limited ABN: 87 009 661 447

Private Mail Bag 6 Mount Isa

Queensland 4825 Australia

Tel +61 7 4744 2011Fax +61 7 4744 3731

Ernest Henry Mining Pty Ltd ABN: 18 008 495 574

PO Box 527 Cloncurry


Tel +61 7 4769 4500Fax +61 7 4769 4555

Copper Refineries Pty Ltd ABN: 12 009 676 975

PO Box 5484 Townsville


Tel +61 7 4781 8211Fax +61 7 4778 2308

Documents

Xstrata Copper North Queensland - Mount Isa Mines · opportunity 43 Non-discrimination policy 43 Labour relations 44 Mount Isa Mines ... and the Townsville port facilities and logistics