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HIGH CAPACITY TRANSHIPMENT SYSTEMS

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“Mining The Pilbara” Port Hedland 9th July 2014

About CSL

Why Transhipment

Transhipment Solutions

Transhipment Evolution

Next Generation of Transhippers

Agenda

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• HISTORY

• 1845: The first of the original companies founded

• 1913: 11 shipping companies merged to create Canada Steamship Lines

• 2013: Centenary celebrations

• CORE BUSINESS

• Designs, builds, owns and operates bulk material handling assets

• Handles nearly 100 Million tons of bulk cargo annually, including ~ 30 million tons transhipment

• GLOBAL

• Largest owner of self-unloader vessels in the world

• Operations in Asia, Australia, Africa, the Americas and Europe

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About CSL

CSL’s WORLDWIDE FLEET

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About 70 bulkers and transhippers

A quicker route to market

Earlier cash-flows, to fund the high cost of upstream infrastructure projects

Earlier royalty payments to fund Government projects

Earlier economic stimulus trickling down through the economy

Reduced risk of environmental wars

Transhipment – The Benefits

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Economies of Scale not otherwise available (up scaling to Cape vessels)

Minimal Investment in Shore side Infrastructure

Minimal Port Infrastructure

Minimal or No Dredging

Minimal Environmental Impact

Transhipment – The Savings

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Transhipment Solutions Approach

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High Volume Systems

Gravity based

Reliable Built-for-Purpose solutions

“Incremental Engineering” around proven solution – No prototyping

Focus on safety/environment

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Transhipment Solutions TSV – Optimization

Red numbers = laytime for a 172,000dwt Cape in days All basis Single shore loader: 6,000 TPH

4.2d

5.7d

8.1d

2.1d

2.9d

4.1d

2.0d

2.3d

2.7d

-

2,500,000

5,000,000

7,500,000

10,000,000

12,500,000

15,000,000

17,500,000

20,000,000

22,500,000

25,000,000

5 nm 20 nm 40 nm

Distance Shore to Anchorage

MT

/An

nu

m

20,000 MT TSV Annual Throughput (300 days/80%)

3.2d

3.9d

5.1d

1.7d

2.0d

2.6d

1.7d

1.9d

5 nm 20 nm 40 nm

Distance Shore to Anchorage

40,000 MT TSV Annual Throughput (300 days/80%)

Transhipment Solutions Incremental Expansion

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$-

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

$14.0

$16.0

$18.0

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

$/t

Million Tonnes

Transhipment Cost per Tonne

1 TSV

2 TSV

3 TSV

Transhipment in The Pilbara - Potential

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Oceanic Bathymetry

Limited opportunity for new deep water ports … little spare capacity in the current deep water ports

Typically – deep water (25m) found 10 - 20 nm from shore; means significant channel dredging to accommodate cape ships

Capital & Environment

$billion savings in infrastructure & port dredging

Limited environmental impact minimizing the “eco-wars”

Uncertainty

Volume ramp-up, Fluctuating iron ore price,

Lead time

Reduced Capex because of smaller infrastructure

Smoother approval process

Leads to earlier start up

PORT HEDLAND

14m channel + tide = max depth ~ 22m

Cape ship departures restricted to high tides

Transhipment – Better Port Utilization

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Cla

ss A

- H

r 0

.0

Cla

ss A

- H

r 1

.0

Cla

ss A

- H

r 2

.0

Cla

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- H

r 3

.0

Cla

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- H

r 4

.0

Cla

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- H

r 5

.0

Cla

ss B

/C -

Hr

6.0

Cla

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/C -

Hr

7.0

Cla

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/C -

Hr

8.0

Cla

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/C -

Hr

9.0

Cla

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/C -

Hr

10.

0

Cla

ss B

/C -

Hr

11.

0

Cla

ss A

- H

r 1

2.0

Cla

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- H

r 1

3.0

Cla

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- H

r 14

.0

Cla

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- H

r 1

5.0

Cla

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r 1

6.0

Cla

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r 1

7.0

Cla

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/C -

Hr

18.

0

Cla

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/C -

Hr

19.

0

Cla

ss B

/C -

Hr

20.

0

Cla

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/C -

Hr

21.

0

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Hr

22.0

Cla

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Hr

23.

0

Tid

e

Tide restrictions ____ Cape departures ____ Under utilized

Biggest Ship Biggest Cargo Most Efficient

Date 11 Feb 2014 5 Dec 2013 3 May 2014

Ship CSB Glory Hugo N Bao Fu

Deadweight 315,063 dwt 297,088 dwt 250,877 dwt

Cargo Lift 235,512 mt 263,962 mt 247,572 mt

% Cargo to DWT 74.75% 88.85% 98.68%

Transhipment – Better Port Utilization

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Some Port Hedland Statistics 1

1 Port Hedland Port Authority Website

Transhipping Potential on the Pilbara Coast

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Transhipping Options

Transhipment Small Port Development

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A suitable strip of coastal land

Build a stock pile pad, or load direct from a rail car dumper

Construct a jetty

Add a conveyor and ship-loader …

Out to Depth of 6.5m

Transhipment Small Port Development

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No Tugs

No Pilots

Fixed Loader & Conveyor

Short Jetty 6.5m draft

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Transhipment Evolution

“Interim Solutions” – Existing Gravity Self-Unloaders

“Lakers” – topping off capes for export “Lakers ” – blending off-shore

“CSL Atlas” - transhipping Iron ore in Liberia “CSL Spirit” - transhipping Iron ore in Canada

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Transhipment Evolution Generation Change

Iron ore in Whyalla – 1st Generation Iron ore in Whyalla – 2nd Generation

Interim Solutions – Iron Ore West Africa High Capacity TSV – 3rd Generation

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Transhipment Evolution “2nd Generation CSL WHYALLA” – TSV Conversion

Prior to conversion

Transhipping off Whyalla Cape loading boom fitted

Existing SUL boom replaced

Transhipment Evolution “2nd Generation CSL Trimnes” – Next conversion

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Transhipment Evolution - Trimnes Conversion Plans

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Installation of shiploader

Bigger Bow/stern thrusters

Single point loading system

Upgraded winches

New auxiliary engines

Bridge Modification

Plastic lining in cargo holds

Fendering installed

Modification of incline boom

Hold strengthening for heavy cargoes

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CSL Whyalla – Transhipping Iron Ore

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Next Generation Transhipment Shuttle Vessels

Flexible Design – Built for Purpose

Environmentally friendly – zero dust

Single Point Loader system if required

Gravity based unloading system

Up to 10,000tph peak transhipment rate with two ship-loaders

Up to 5,000tph peak transhipment rate with a single ship-loader

Highly maneuverable with azimuth thrusters – no tugs required

Loading directly to Capes.

30k – 60k tonnes dwt 12k – 25k tonnes dwt

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NO PORT? NO PROBLEM!