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Title: NORTHPARKES MINES

Authors: A Butcher1, R Cunningham2, K Edwards3, A Lye4, J Simmons5, C Stegman6 and A Wyllie7.

1. Manager, Ore Processing and Logistics, Northparkes Mines, PO Box

995, Parkes NSW 2870, Australia. 2. Manager, Special Projects and Tunnel Boring Systems (TBS),

Northparkes Mines, PO Box 995, Parkes NSW 2870, Australia. 3. Manager, Health, Environment, Safety, Communities and Farms

Northparkes Mines, PO Box 995, Parkes NSW 2870, Australia. 4. General Manager, Projects, Northparkes Mines, PO Box 995, Parkes

NSW 2870, Australia. 5. Personal Assistant to the Managing Director, Northparkes Mines, PO

Box 995, Parkes NSW 2870, Australia. Email: Jane.Simmons@riotinto.com

6. Managing Director, Northparkes Mines, PO Box 995, Parkes NSW 2870, Australia. Email: Craig.Stegman@riotinto.com

7. Superintendent, Mine Design, Northparkes Mines, PO Box 995, Parkes NSW 2870, Australia.

Publication: AMMOP Contact person: Craig Stegman Managing Director

Northparkes Mines PO Box 995, Parkes NSW 2870, Australia Phone: +61 2 6861 3117 Mobile: +61 (0) 457 430 897 Fax: +61 2 6861 3102 Email: Jane.Simmons@riotinto.com

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INTRODUCTION

Overview Northparkes Mines (Northparkes), an unincorporated joint venture between Rio Tinto (80 per cent), Sumitomo Metal Mining Oceania (13.3 per cent) and Sumitomo Corporation (6.7 per cent), operates block cave and open cut mines and an ore processing plant located 27 km north of Parkes in central New South Wales (Figure 1). The mine site is located at an elevation of 230 m above sea level on the plains to the west of the Great Dividing Range in the headwaters of the Bogan River, which is part of the Murray Darling Basin. The land surrounding the operations is mainly used for farming (a mixture of dry land cereal cropping and sheep/cattle grazing). Annual rainfall is in the range of 400 - 1000 mm (average 600 mm). Northparkes Mines owns 6000 hectares of land around the mine, of which the mining leases cover 1630 hectares. The remaining land is actively farmed. Production commenced in 1993 and the operation has produced approximately 750 000 tonnes of copper and approximately one million ounces of gold to the end of 2010 (approximately 20 per cent from open pit and 80 per cent from underground). Ore is currently sourced from the E48 Lift 1 block cave mine (the third block cave) and open cut stockpiles. Approximately 5.8 Mt/a of ore is processed annually on site, producing 140 000 - 150 000 t of copper and gold concentrates that are shipped to custom smelters in Japan, China and India for smelting and refining. A production summary is given in Table 1. The current life of mine is 2024, based on Reserves of 75.5 Mt of ore grading 0.82 per cent copper and 0.32 g/t gold (as of 31 December 2010). Northparkes has a large resource base of 287.8 Mt grading 0.57 per cent copper and 0.26 g/t gold.

Northparkes currently has approximately 700 full-time equivalent employees, comprising approximately 300 staff and 400 contractors. Most employees live in Parkes and the neighbouring town of Forbes. History North Limited acquired the Northparkes project through its merger with Peko Wallsend in the 1980s. North approved the Northparkes project, comprising underground block cave and open cut mines and concentrator, in 1992 following an extensive and lengthy studies phase. The low-grade nature of the Northparkes deposits and their relative depth precluded many conventional underground mining methods. North subsequently formed the Northparkes joint venture with Sumitomo Metal Mining Oceania and Sumitomo Corporation in 1993 in order to obtain a development partner with downstream smelting and refining capability. Rio Tinto acquired North Limited in 2000 and assumed management of the Northparkes joint venture. The joint venture partners approved construction of the E26 Lift 2 block cave mine in 2001. Mining of the Lift 1 block cave mine was completed in October 2003 prior to completion of the Lift 2 mine. Concentrator production was maintained by undertaking a further cutback in the E27 open cut mine. Production from the Lift 2 mine began in August 2004. The joint venture partners approved the E48 Lift 1 block cave mine in November 2006. Large-scale production from the E26 Lift 2 block cave mine ceased in August 2007, much earlier than planned and again prior to completion of the new block cave mine. As a result, further mining took place in the E22 pit and an extension of the Lift 2 block cave mine, the E26 Lift 2 North block cave, was constructed. These two ore sources allowed concentrator

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production to be maintained in full through the transition period, which was extended by nearly a year due to a nine-month suspension of construction of the E48 Lift 1 mine in 2009 due to the global financial crisis. Production ramp-up from the E48 Lift 1 block cave mine commenced in 2010 with the new block cave mine becoming the main ore source in late 2010. Operating strategy, constraints and innovation Northparkes’ current operating strategy primarily reflects the unique configuration of the E26, E22, E27 and E48 deposits. The deposits are all relatively small compared to porphyry copper deposits worldwide, although they are vertically continuous and in close proximity to each other. At the time of mine start-up, the deposits were regarded as low-grade. In addition, the deposits are hosted in very competent rock-types. Whilst the near-surface portions of the deposits were ideally suited to open cut mining, the deeper sections were more problematic. They could not be economically extracted by conventional underground mining methods like long-hole open stoping. The small footprints of the deposits and competent rock-types appeared to preclude caving mining methods. After much research and study, Northparkes finally adopted a highly modified block cave mining method to extract the deeper resources. Block caving has allowed Northparkes to achieve very low mining costs and high productivities by industry standards, mainly through the application of very efficient automated material handling and comminution systems that minimise ore re-handle, including high speed electric load haul dump units, jaw-gyratory crushers, high-speed conveyors and shaft hoisting systems. However, all of Northparkes’ block caves are characterised by high height to width ratios and cave footprints that are very close to the minimum hydraulic radius required to initiate continuous caving. This has required considerable innovation to improve caveability, including hydro-fracturing and drilling and blasting of the rock mass to reduce rock strength. The block cave layout has evolved considerably since the first block cave mine, with each subsequent mine representing an improvement on the previous version. Other factors that have influenced the design and operating strategy of Northparkes operations include: • The construction lead-time for block cave mines is significant and typically of the order of

three to four years, requiring significant upfront planning. • Block cave production rates are intimately tied to the rate of caving; production rates will

be reduced if cave propagation slows. Likewise, there is a much higher chance of incomplete reserve recovery in block cave mines compared to more conventional mining methods. As a result, it has been important for Northparkes to establish alternate ore sources to cope with production shortfalls from the block cave mines.

• The closeness of Northparkes’ deposits has also allowed considerable sharing of infrastructure, including mine access, material handling and ventilation systems, and also facilitated the sequential extraction of progressively deeper and lower-grade ore bodies.

• Proximity to major established infrastructure, including the Newell Highway, the junction of Australia’s east-west and north-south rail corridors that provide rail access to a number of ports, regular air-services to Sydney and the main Australian East Coast electricity grid.

• Proximity to a number of key regional centres, including Parkes, Orange and Dubbo, which provides ready access to a significant pool of employees and contractors, as well as engineering and maintenance groups. This has also allowed Northparkes to operate as a residential operation.

• Lack of appreciable water resources in close vicinity to the mine has required Northparkes to source its water from the Lachlan River and aquifers 60 km to the south of the mine. Many townships and other industries also depend on these resources,

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especially during droughts, highlighting the importance of minimising water usage and improving water recycling.

• Location within traditional farming areas has resulted in a strong focus on creating a effective buffer between neighbouring farming operations and the mine, including minimising noise, traffic interactions and continuing to use available land for cropping.

General infrastructure Northparkes requires approximately 3600 ML water per annum to process a nominal 5.8 Mt of ore. Most of this water is sourced from a bore field adjacent to the Lachlan River approximately 60 km south of the mine. A small amount of water is also abstracted from the Lachlan River. Water is piped to Parkes via infrastructure shared with the Parkes Shire Council and then to the mine through a dedicated water pipeline. Electricity needs of approximately 215 GWh, at an average load of around 24.5 MW, are met entirely from the main East Coast Australian electricity grid. The bulk of the electricity is consumed by the underground crushers and hoist and the grinding circuit in the concentrator. Future plans In August 2010 Northparkes Mines announced the approval for a $90 million pre-feasibility study (subsequently increased to $115 million) assessing the potential to extend mine life beyond 2024. This project envisages a large-scale mining and processing operation based on a series of larger lower-grade resources located within existing mining leases. The key part of the pre-feasibility study will be a major evaluation drilling program, involving in excess of 155 km of drilling, which will assess identified copper and gold mineralisation within the existing mining leases beneath current mining operations on the E26, E48 and E22 deposits, and at the GRP314 area of mineralisation (Figure 2). Central to the pre-feasibility study will be community consultation and the assessment of both existing and new technology that will deliver environmental outcomes including improving water, energy efficiency and biodiversity. It is anticipated that the pre-feasibility study will take approximately two years to complete at which time the Joint Venture partners will determine whether to progress to a feasibility study.

GEOLOGICAL DESCRIPTION Exploration activities in the Northparkes area were initially undertaken by the corporate exploration groups of Geopeko and North Limited until 1998. From 1998 onwards, Northparkes has managed all exploration in the district, focussing exclusively on the Goonumbla Volcanic Complex. A combination of magnetic, gravity and electrical geophysical surveys, bedrock geochemistry, geological interpretation and deep diamond drilling has been used to help discover new porphyry systems including the GRP314 deposit. Recent exploration activities have provided extensive deep drill coverage in the mine corridor. This has led to the discovery of additional mineralisation at depth beneath existing mining operations at E22, E26 and E48 deposits. The ore reserves and resources according to the JORC code are listed in Table 2. The Northparkes deposits occur within the Ordovician Goonumbla Volcanics of the Goonumbla Volcanic Complex (Simpson et al, 2000). The Goonumbla Volcanics form part of the Junee-Narromine Volcanic Belt of the Lachlan Orogen (Glen et al, 1998). The Goonumbla Volcanics consist of a folded sequence of trachyandesitic to trachytic volcanics and volcaniclastic sediments that are interpreted to have been deposited in a submarine environment. The Northparkes deposits are typical porphyry copper systems in that the mineralisation and alteration are zoned around quartz monzonite porphyries. The porphyries form narrow (typically less than 50 m in diameter) but vertically extensive (greater than 900

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m) pipes. Mineralisation extends from the porphyries into their host lithology. The E26 and E48 deposits range from 60 m to 400 m in diameter (>0.4 per cent copper) and extend vertically for more than 1100 m. Figure 3 shows a north-south geological cross-section of the main resources. Sulfide mineralisation occurs in quartz stockwork veins, as disseminations and fracture coatings. Highest grades are generally associated with the most intense stockwork veining. Sulfide species in the systems are zoned from bornite-dominant cores, centred on the quartz monzonite porphyries, outwards through a chalcopyrite-dominant zone to distal pyrite. As the copper grade increases (approximately >1.2 per cent copper), the content of covellite, digenite and chalcocite associated with the bornite mineralisation also increases. Gold normally occurs as fine inclusions within the bornite. Bornite is the predominant ore mineral in all deposits. Copper to gold ratios differ between the different deposits and within individual deposits. The E22 and E27 deposits have lower copper to gold ratios compared to the E26 and E48 deposits. In all deposits, the copper to gold ratio decreases towards the centre of the deposit. All the Northparkes deposits are cross cut by late faults/veins filled with quartz-carbonate and minor gypsum, anhydrite, pyrite, tennantite chalcopyrite, sphalerite and galena. The associated sericite alteration extends up to 10 m from the fault. Tennantite, which contributes arsenic to the final copper concentrate, is present in higher concentrations in the E48 deposit. Oxide mineralisation blankets were well developed over the E22 and E27 deposits. The upper blanket was gold-rich and copper-poor. The lower blanket was enriched in copper by supergene processes. The dominant copper oxide minerals at E22 and E27 were copper carbonates (malachite and azurite) and phosphates (pseudomalachite and libethenite) with lesser chalcocite, native copper, cuprite and chrysocolla. A gold-poor, less well developed, supergene copper blanket was also developed over the E26 deposit. At E26 the oxide copper minerals included atacamite, clinoatacamite and sampleite, in addition to those copper minerals observed in E22 and E27. The Goonumbla Volcanics at Northparkes have undergone little deformation, with gentle to moderate bedding dips as a result of regional folding. The dominant structure observed to date in the Northparkes area is the Altona Fault, an east dipping thrust fault, which truncates the top of E48 and GRP314, and is known to extend from east of E26 to E27. MINING OPERATIONS – UNDERGROUND Overview Northparkes was the first mine in Australia to use a variation of the cost-effective block cave mining technique in its underground operations. Northparkes is currently mining its third block cave mine (Table 3 and Figure 4). Pre-production mining development work consists of establishing two working levels, the undercut level and extraction level, at the base of each ore block, as well as the development to support the associated material handling system. Northparkes has developed its own unique extraction level layout that locates the material handling system, including crusher, to the side of the extraction level, thereby alleviating the need to construct a third level dedicated to haulage. Similarly, it has established the extraction level as the primary ventilation level, thereby eliminating development to support mine ventilation. The undercut level, which is used to initiate caving, is 14 - 20 m vertically above the extraction level; the height being dependent on the undercutting method. Undercutting, which involves sequential firings of overlapping fans of blast holes to create the initial void for caving, is the rate controlling step for production ramp-up, controlling both the rate of undercutting ore and then

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the start of production from draw points. Northparkes has consistently set record levels for undercutting. During the recent E48 campaign, an average of twelve draw bells and 7000 m2 of undercut were blasted per month, allowing the undercutting to completed in 12 months. Rapid undercutting can in part be attributed to firing draw-bells in a single firing using electronic detonators. Following draw bell blasting, the associated draw points are brought into production with production rates ramped up to full production over a period of three to six months. A number of undercutting methods have been used. The E26 Lift 1 cave utilised a double undercut (two undercut levels) in an attempt to increase productivity from the cave during production ramp-up. Subsequent caves relied upon a single undercut level. Both the E26 Lift 1 and Lift 2/2N caves employed an advanced undercut method; essentially, draw points and draw bells were installed after the undercut level had been blasted. In contrast, the E48 Lift 1 cave utilised a post-undercut method where draw points and draw bells were constructed prior to undercut blasting. The advanced undercut method is best suited to higher stress conditions where it is important to minimise openings to preserve the strength and integrity of the extraction level rock mass. Geotechnical description Northparkes has established comprehensive geotechnical models for all of its block cave mines. The models are based on geotechnical logging of extensive diamond drill core data sets, augmented by mapping of underground openings established during the early study phases. For example, a total of 57 NQ and HQ drill holes and wedges for 35 000 m of drilling were completed at the E48 Project and an exploration drive was developed across the E48 extraction level during the feasibility study to validate the drill core data. The geotechnical core logging comprises both interval logging and detailed oriented fracture logging. This data allows the rock mass to be characterised in terms of rock quality designator (RQD) and the various rock mass rating systems (MRMR, Q system and RMR system), fracture density and fracture orientations. In addition, geophysical logging of selected drill holes is undertaken to compliment the geotechnical logging. Other data collected includes point load strength tests, over-core stress measurements and UCS rock strength measurements. The Northparkes rock mass, including the E48 and E26 deposits, is a highly jointed rock mass with fracture frequencies of between three and 20 per metre and with fracture density increasing with copper grade. The volcaniclastic and volcanic units tend to be more highly fractured than the monzonites and porphyries. Rock strengths range from 90 - 150 MPa with locally weaker zones associated with late stage shears. The maximum principle stress direction is sub-horizontal and striking northwest-south east with a magnitude of 30 - 40 MPa at the E48 extraction level. The minimum principle stress direction is sub-vertical. Standard ground support comprises 2.4 m resin-encapsulated rock bolts installed on a one metre pattern, complimented with 50 - 75 mm of fibre-reinforced shotcrete. All intersections are cable bolted using twin-strand 6 m long cables. In areas of higher stress, for example, draw points, additional cabling, meshing and strapping will be installed. Mine planning practices and procedures Block cave reserves are estimated with PCBC software based on mixing and dilution parameters derived from reconciliations of earlier block cave mines (eg E26 Lift 1 and Lift 2). Recent upgrades to the software, including template mixing, have allowed the effects of lateral flow and toppling to be better estimated. However, it is still necessary to closely monitor actual draw point grades and draw point geology to validate the reserve models, including the effects of preferential migration of finer particles and of dilution. Checks are also

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made by shadowing the PCBC models with REBOP simulations (particle flow models). Reserves are typically estimated by depleting the original reserves for production and accounting for cave shape. Production plans are based on life of mine PCBC models based on the predicted draw plan. Northparkes mostly draws its block caves to an even height of draw. However, once break through has occurred, selective draw can be established to achieve either higher grade production and/or to stimulate cave propagation. However, a minimum draw is generally maintained across the extraction level to minimise the potential for localised loading on the level. Mining process and equipment Figure 5 shows the layout of the E26 Lift 2 Block Cave mine and Table 4 gives a list of the underground mining equipment. Figure 6 shows the E48 Lift 1 mine material handling system. Mine access for all personnel and equipment is provided by surface portal and decline. The decline has a standard 6 m by 6 m arched profile. The hoisting shaft represents the second means of egress and the ore skips can be fitted with a man-riding cage in the event that personnel cannot egress the mine via the decline. The mine ventilation system consists of two surface mounted 750 kW exhaust fans mounted above a system of vertical and lateral return air raises. The primary air intakes are the main decline and the hoisting shaft. Draw is balanced to control air velocity in the hoisting shaft due to the risk of displacing hoisting components at excessive air velocities. The ventilation system typically operates at airflows of 390 - 400 m3 per second, which are shared across the various work areas, Water inflows to the mine are relatively modest – of the order of 3 - 5 L/s. Dewatering systems are installed at the base of each extraction level and are designed to cope with large inflows from the cave volume and subsidence zone. The mining process involves recovery of broken rock from the draw points by 14 t capacity electric Load Haul Dump Units (LHDs), which tram the ore to a primary crushing station, consisting of plate feeder and jaw gyratory crusher, located on the margin of the extraction level. Typically, four to five LHDs operate on a continuous basis to achieve daily production targets of 18 kt per day. Oversize rock is broken on the extraction level using specialist secondary breaking drills. Draw point hang-ups are addressed with a combination of water cannons and high hang-up drill rigs. Extraction level layout has evolved considerably to address a range of design elements, including: • concurrent LHD operations to maximise extraction level productivity; • LHD access to multiple drives to improve operational flexibility; • roadway designs to allow high-speed (fourth gear) LHD tramming; • crusher configuration to reduce the volume of secondary breaking; • ventilation flows and dust suppression systems to ensure dust from loading operations is

minimised; • drainage to control water flows and direct away from the extraction drives; • communications systems to allow single point control of extraction level operations; • maintenance facilities located on the margins of the extraction level to maximise LHD

availability; and

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• extraction level infrastructure to support operations, maintenance and service crews, including crib rooms and fresh air bases.

The material handling system employed at Northparkes has been designed to minimise ore rehandling and is fully automated. Ore is fed to a coarse ore bin that feeds the primary crusher. Two jaw crushers were employed in the E26 Lift 1 mine but subsequent mines utilise a single jaw-gyratory crusher. Crushed ore is fed onto high-speed inclined conveyors via an ore pass that also provides storage capacity. Ore is conveyed to the underground loading station, which consists of three ore passes feeding the hoisting system. The hoisting system consists of a ground mounted friction winder with integrated drum and rotor, servicing two 16 t payload skips in counterbalance, running on rope guides in the 6 m diameter concrete-lined shaft. Considerable work has been undertaken to improve the capability of the hoisting system, which represents the mining operations’ key bottleneck. This work has mainly focused on improving the availability of the hoisting system. Hoisted ore is transferred via a short conveyor to a secondary crushing station located near the head frame. The secondary crusher, which was installed as part of the E48 Project, reduces the ore to a P80 of 55 mm, improving the overall capacity of the concentrator circuit. Ore from the secondary crusher to then conveyed to the concentrator by a curved high speed conveyor that skirts the E48 subsidence zone. The underground mining operation has approximately 80 full-time employees, consisting of mine management and operations, technical services and maintenance teams. The operations team has four crews working 12-hour shifts. Each crew consists of a team leader, five LHD operators, three secondary breakers, two conveyor belt runners and a SCADA/Database operator. A service crew is also employed to maintain basic infrastructure and services in the mine, including road grading and stores transport. The technical services team comprises approximately 12 staff including mining and geotechnical engineers and technicians. Approximately 25 mechanical and electrical maintenance personnel manage the physical assets in the mine. Cave management, ore control and reconciliation procedures Northparkes has developed a comprehensive cave management system based on its experiences with operating the E26 block caves. These management systems are designed to manage the specific catastrophic safety risks particular to block caves; namely airblast, surface subsidence and inrush and large-scale rock falls. The system is also designed to support maximising reserve recovery and optimising mine production. The system is based on a large number of monitoring systems, including real-time microseismic event monitoring, open hole surveys using probes and video cameras, time domain reflectometers installed in grouted boreholes, convergence monitoring using extensometers and manual measurements of mine openings on the extraction level and in key underground infrastructure, draw point fragmentation and geology mapping, draw point grade sampling, subsidence zone volume estimates and water inflow measurements. These data are reviewed on a monthly basis and monitored against triggers that form part of formal triggered action response plans (TARPs) that have been developed in conjunction with the mining inspectorate. Draw point grade control samples are collected at a rate of two to three samples per draw point per month to allow monthly reconciliations of sampled grade against concentrator grades and predicted reserve grades. Towards the end of the life of the block cave mine, the grade control samples are used to determine draw point shut-off strategies.

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Innovation and improvement Notable technology applications included the application of microseismic and other remote monitoring cave management systems, hydro-fracturing for cave propagation, use of electric loaders and jaw-gyratory crushers. Northparkes’ block caves are amongst the most heavily monitored in the industry, which reflects the complexity associated with block cave mines characterised by small footprints, high heights of draw and relatively strong rock mass. The development of very sensitive microseismic monitoring systems in the pre-production stages of mine development has allowed Northparkes to very accurately map and track the distribution of micro-seismic events in the mine environment, leading to an improved understanding of cave propagation processes, as well as improving safety management and reserve recovery. Hydro-fracturing was first applied at Northparkes in 1998 to assist with the Lift 1 cave propagation in areas of competent rock mass and relatively low stress environment. Hydro fracturing proved successful in stimulating cave propagation in the E26 Lift 1 cave and has been applied to the E26 Lift 2 North and E48 Cave volumes prior to caving. Whilst difficult to quantify, hydro fracturing is believed to have substantially assisted cave propagation in both cases. The use of six electric powered loaders as the primary production fleet was the first of its size in the industry. This application provided many benefits over conventional diesel powered loaders, most notably reduced maintenance costs, longer equipment life and a significant reduction in carbon emissions and corresponding ventilation requirements. This loader fleet has demonstrated superior performance over an extended period of time with operational lifetimes of in excess of 13 years and 30 000 operating hours. A single jaw-gyratory crusher was installed as part of the E26 Lift 2 mine. The primary advantage of this style of crusher over conventional crushers is its ability to accept a maximum rock size of three cubic metres whilst achieving a consistent P80 of 120 mm, thereby dramatically reducing the secondary breaking burden on the Extraction Level. As a result, a grizzly screen is not required on the crusher feed bin, although a rock breaker is fitted to the crusher to address periodic blockages in the crusher and on the plate feeder. MINING OPERATIONS – OPEN PIT Overview Open cut mining has been used to access the near surface portions of the copper-gold deposits at Northparkes, initially to allow accelerated ore processing prior to commissioning of underground operations, but also to supplement underground production during the transition from one cave to another. As a result, open cut mining has typically been undertaken on a campaign basis, often relying upon contractor mining. The most recent campaign in E22 pit, which was completed in September 2010, was managed by utilising a number of major contractors. All heavy earthmoving equipment (excluding drill rigs) was supplied by a contractor as a maintained dry hire fleet with rates based on engine hour utilisation. Drilling was undertaken by a specialist drilling contractor on fixed and metre rates. Operators were sourced from a local labour hire company on casual rates and explosives where supplied by a contractor with loading and tie by Northparkes operations team. A total of 25 Mt of rock was extracted from the E22 pit during this campaign, including 12 Mt of ore. Nine million tonnes of ore has been stockpiled for future processing. Geotechnical description

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The E22, E26 and E27 open cuts were all roughly circular in shape, with diameters of up to 600 m and ultimate depths of up to 220 m. The E22 and E27 pits were both mined in three stages; the initial pit followed by two cut-backs. Typical ore waste ratios were of the order of 1:2. Each of the open cut mines at Northparkes encountered very weak surface clays and weathered rock to depth of 30 - 50 m before transitioning to highly fractured unweathered volcanic and intrusive porphyry rock-types, the latter often located in the pit centre. These rock types were over-printed by widely spaced, large-scale, steeply dipping sericite-altered fault zones. Fracture density and hydrothermal alteration intensity typically increased towards the porphyries. In addition, most fractures dipped inwards to the pit centre. As a result, pit wall stability was a major challenge during mining operations. Batter angles in the surface clays and weathered rock were between 30 - 45 degrees. Whilst this produced stable walls in most circumstances, there were localised failures due to a combination of surface and ground water and larger scale discontinuities. As a result, considerable focus was placed on managing drainage around the pit walls and on drilling depressurisation holes in the pit walls. Batter angles in the sulfide rock in the early mining campaigns were in the range of 55 degrees to 60 degrees. However, by reducing blast damage through the use of trim shots, pre-split drilling and reduced blast bench heights and introducing a range of ground support (shotcrete and cable bolting), batters were successfully steepened to 80 to 90 degrees. Berms were initially 5 m wide but were increased to 8 m in later mining campaigns in conjunction with the steeper batters to improve catch capacity. Bench heights were typically 20 - 21 m. A combination of geotechnical mapping, constant wall monitoring and ground penetrating radar was also employed to assist with pit wall management. Mine planning Pit designs were based on Whittle optimisation utilising long-term metal price assumptions and minimum mining width criteria based on mid-sized excavator-truck fleet. Mining process and equipment Mining of the open pits typically involved medium-sized (180 to 220 t) hydraulic excavator in backhoe configuration and a fleet of 85 - 100 t trucks, together with an array of conventional ancillary equipment, including rotary blast hole drill rigs, graders, dozers and water carts. All pits utilised a single 20 - 23 m wide 1:7 ramp for access. The width was based on two-way traffic for the haul trucks. The ramp width was reduced in single lane near the pit bottom. Initial excavation of weathered clay and rock did not require blasting and could be ‘free dug’. However, at depths of between 10 m and 30 m, harder rock was encountered which required blasting before excavation. The standard blast hole pattern was 3.5 m x 4 m with a blast bench height of 5 - 7 m. Hole diameter ranged from 102 mm in early campaigns to 15 mm in later campaigns. ANFO was used in the upper benches but emulsion was used in lower benches where ground water was likely to be encountered. Latter mining campaigns used Unitronic electric detonators. Hole diameter ranged from 102 mm and 89 mm blasting drill holes for Unitronic electric detonators.

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Waste rock removed from the open cuts has been formed into sound bunds around the perimeter of the pits to minimise transmission of noise and dust to neighbouring properties. The waste rock has also been used in the construction of the tailings storage facilities. Ore was either directly tipped on a run of mine stockpile near a surface crusher for immediate processing or placed in a series of grade-controlled stockpiles. Ore control and reconciliation procedures Early campaigns used reverse circulation drilling for grade control. However, reverse circulation caused significant delays to the mining process and was replaced with blasthole cone sampling with one sample per blast hole. Whilst sample quality was reduced, overall sample density was higher, resulting in an overall improvement to grade control quality. Quality control through the onsite lab was checked by using field duplicates every 25 samples and inserting certified standards every 40 samples. Grade control blocks were estimated by block modelling methods using kriging. A minimum practical mining block was set at 15 x 20 m. A range of high, low and marginal grade bands were used for stockpiling with the waste material cut-off based on break-even processing costs based on long term forecast prices. PROCESSING OPERATIONS Mineralogy and characterisation The E48 ore body is the dominant supply of ore to the concentrator, with 100 per cent of supply provided since late 2010. Stockpiles of open cut E22 ore are held, and provide a buffer for short supply from the underground mine. The main copper bearing minerals from all ore bodies processed are bornite and chalcopyrite. The E22 ore is lower grade than the E48 ore body and is characterised by lower bornite: chalcopyrite ratios. As copper grade increases the content of covellite and chalcocite associated with the bornite mineralisation increases. Rare visible gold occurs as inclusions up to 1mm in diameter within bornite or more rarely as free gold in quartz veins. Due to the intimate relationship with bornite, visible gold tends to occur within the highest-grade zones of the central portion of the deposit. Chalcopyrite is the dominant sulfide species outboard of the bornite rich core. Chalcopyrite occurs as disseminations within veins and wall rock, and frequently occurs along fine fractures. Pyrite is generally restricted to the lower grade peripheries of the mineralisation, outboard of the chalcopyrite dominated zone. Concentrate copper grades of 33 per cent are typically achieved compared to 35 per cent from the E48 ore. The ore mineralogy of the E48 deposit consists of bornite as the dominant copper-sulfide species and occurs in association with significantly smaller, but variable amounts of chalcopyrite and chalcocite. Gold and silver are present largely as small particles (often <5 µm in size) of metallic gold and electrum as well as gold and silver bearing tellurides, notably petzite (Ag3AuTe2) and hessite (Ag2Te). The metallurgical performance of the E48 ore is limited by the finer overall grain size and the resultant poorer liberation of copper sulfides from their associated gangue in the >38 µm size fractions. The arsenic in the E48 ore is hosted almost entirely by tennantite that is present as small grains (usually <25 µm in size) and are intimately intergrown with chalcopyrite and, to a much lesser extent, sphalerite and/or galena. Arsenic therefore follows copper during flotation and limited scope exists for significantly reducing the arsenic content of the concentrates during rougher flotation. Some scope might exist for reducing the arsenic content by selective tennantite removal during cleaning, particularly if a regrind stage is

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required. This may be the subject of further studies as the mine develops and As concentration increases in the product. Process description Ore processing consists of four stages: crushing, grinding, flotation and thickening/filtering. The flowsheet is shown in Figure 7. The process plant equipment and process plant consumables are listed in Tables 5 and 6, respectively. Table 7 presents a typical metallurgical balance. The ore processing team also manages tailings disposal and concentrate logistics to port. The concentrator was constructed in two modules, namely Module 1 and Module 2. Each module consists of its own grinding circuit, flotation circuit, concentrate thickener and filter. The tailings are combined in a single tailings thickener before being deposited in one of three tailings storage facilities. The Module 1 grinding circuit was the first to be constructed along with a gold Carbon-in-Leach circuit. The upper gold oxide sections of the E27 and E22 ore bodies were processed through Module 1 during the initial 18 months of operation at Northparkes (~1993) to produce gold bars. During this period, Module 2 was constructed and featured a grinding circuit and copper oxide flotation circuit. Once gold production ceased in Module 1, the CIL plant was decommissioned and Module 1 was converted into a sulfide flotation circuit. Copper oxide ore was processing from 1995, followed by copper sulfide ore. The operating philosophy is simple: maximise plant throughput, then recovery, followed by grade. Key performance metrics are assigned to all process variables and are monitored daily in order to better understand the sources of variation in the process. Corrective actions are taken to eliminate assignable causes to control stability and thereby improve the plant’s capability for greater production rates and product quality. The metallurgical accounting system is based on a process mass balance. A software package developed by Matrikon (‘ProcessMORe’) is used to record downtime and production results. A JK SimMet model and empirical models are used to evaluate production plans and forecast process outputs. The ore processing department has approximately 50 full-time employees, consisting of management and operations, metallurgy and laboratory teams. The operations team has four crews working 12-hour shifts to achieve 24/7 production. Each crew consists of a team leader, two grinding operators, two flotation and thickener/filter operators and a tailings and water storage operator. A service crew is also employed to maintain basic infrastructure and services in the plant, including water supply, grinding media and reagents delivery management. The ore processing department also manages tailings disposal and concentrate logistics by road and rail to Port Kembla, NSW. The metallurgy and laboratory team comprises approximately 12 staff including metallurgists and laboratory personnel. The laboratory is responsible for all metallurgical testwork and assaying as well as providing services to the mining and exploration departments. Approximately 30 mechanical and electrical maintenance personnel manage the physical assets in the concentrator. Concentrator maintenance is provided by the asset management department, which manages maintenance across site, including the underground mine. Crushing and ore handling

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Northparkes has two adjacent coarse ore stockpiles (Rill Tower stockpiles) that are able to receive crushed ore via conveyor from both the surface (open cut mines) and underground crushers. A secondary (cone) crusher was installed in early 2011 and is located between the primary underground crusher and the ore stockpiles. The total capacity of each stockpile is 150 000 t. Crushed ore is reclaimed from the base of each stockpile by four vibrating feeders. Grinding The grinding circuit is made up of two separate modules, each incorporating semi-autogenous grinding (SAG), oversize pebble crushing, two stages of ball milling and flotation. Module 1 has a maximum design capacity of 245 t/h and operates at 95 per cent utilisation for an annual throughput rate of 2.2 Mt/a. Module 2 has a maximum design capacity of 425 t/h and operates at 95 per cent utilisation for an annual throughput rate of 3.6 Mt/a. These rates have been exceeded during periods of processing high clay material and also following the recent installation of a secondary crusher, to produce a finer feed to the mills. The ore from the stockpile feeders is discharged on to a conveyor feeding each SAG mill. Feed size (F80) to the SAG mill was historically 100 - 150 mm, however following the recent secondary crusher installation, the F80 is now approximately 55 mm. Steel balls (125 mm diameter) are added to the SAG mills as the grinding charge. Acoustic monitoring systems are installed on both SAG mills and mill charge is controlled to both sound and power set points. The SAG mill is in closed circuit with a vibrating screen and an oversize pebble cone crusher. The vibrating screen has an aperture size of 8 mm. The oversize is fed to the pebble crusher to produce a <10 mm product. The undersize from the SAG vibrating screen is pumped to primary cyclones, from which the undersize reports to the ball mill for further size reduction, and the oversize bypasses the ball mill. Secondary cyclones classify the ball mill product, and a tertiary grinding circuit (ball mill and cyclones) completes the grinding process. The tertiary grinding stage reduces the particle size from a P80 of 150 µm to less than 100 µm, which feeds the flotation circuit. Flotation Flotation takes place in two distinct but similarly configured modules each linked to its own grinding circuit. The flotation process aims to recover the major copper and gold bearing minerals (bornite, chalcopyrite and chalcocite) to produce a high-grade sulfide concentrate. Each grinding module features a flash flotation circuit (rougher cell and cleaner cell) which aims to mainly recover the coarse liberated bornite in a fast float, to prevent over-grinding downstream. Depending on the ore source, approximately 20 per cent of the overall copper production is recovered in the flash flotation circuits. The tertiary cyclone overflows of each module feed the main flotation circuits. Initially, a pre-flotation stage is performed in large tank cells, which recover approximately 50 per cent of the overall copper production. Frother and a thionocarbamate promoter are added to this pre-flotation stage. The pre-flotation tail stream is then further treated with reagents in conditioning tanks to enhance the flotation characteristics of the valuable minerals. A sulfidising reagent, sodium hydrosulfide, is added followed by a xanthate collector and frother. The conditioned pulp flows through a series of conventional square rougher and scavenger cells. Down-the-bank xanthate and frother addition is also employed. The total residence times of the roughing circuits (excluding flash flotation) for Modules 1 and 2 are 19 minutes and 28 minutes, respectively. The rougher concentrator is sent to Jameson

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cleaner cells and conventional cleaner scavenger flotation cells to upgrade the quality of the product. The final tailing from each module is pumped to a common tails thickener for dewatering. Overall metal recoveries from processing E48 Lift 1 cave ore average 91 - 92 per cent copper and 75 - 80 per cent gold. Similar recoveries were achieved for the other main Northparkes ore types. Concentrate grades are in the range 34 - 40 per cent copper and 15 - 20 g/t gold. The principal penalty elements are arsenic, fluorine and Al2O3/MgO. Copper recovery and grade are controlled in the flotation circuit using a MSA online analysis system. Scavenger feed grade, final tail grade and concentrate grade are the main control variables used to ensure the plant is operating optimally. Cascade control loops are also utilised to adjust reagent doses depending on the feed tonnage. Concentrate thickening and filtration Final concentrate from the flotation circuits is pumped to thickeners where it is thickened to an average underflow density of 60 per cent solids to maximise water recovery. Thickened concentrate is then pumped to concentrate storage tanks prior to treatment through the filtration circuit, using ceramic filters. The filtered concentrate is discharged onto slow moving conveyor belts, each equipped with a weightometer to determine final production of concentrate. Typical moisture contents of concentrate vary between 7 and 9 wt%. Tailings storage and water management All tailings are pumped from the processing plant using two of three sets of slurry pumps to either of the two active tailings storage facilities (TSF 2 and the E27 in-pit storage). Two pipelines are used to transport the tailings 2 km from the processing plant to their final storage point in central decant storage facilities. Both TSF 1 and TSF 2 have surface areas of approximately 100 hectares, and water recovery off TSF 2 is about 30 per cent. Wall construction is comprised of clay and rock. Northparkes has recently undertaken tailings disposal in the abandoned E27 pit, and water recovery from this pit is about 50 per cent. Water is recovered from the tailings storage facilities for use back in the processing plant. Water recovery is optimised by maximising the tailings thickener density and using the site’s deep water storage facilities, E27 and Caloola. Concentrate logistics Copper concentrate is loaded into 26 t capacity lidded steel containers in a covered concentrate storage facility in the processing plant. The loaded containers are transported two at a time by road freight from the mine site to the Goonumbla rail siding approximately 15 km from the mine. The containers are stored at the siding before being railed to Port Kembla. Each train load contains approximately 1500 t of concentrate. The containers are emptied at the port and returned to site. The concentrate is stored in a covered shed until a 10 000 tonne cargo is ready for shipping to custom smelters in Japan, China and India. Innovation and improvement A number of improvement programmes and innovations are underway. Opportunities that have been identified include: reviewing the feed size of the SAG mills, introducing visual management systems, and the development of standard response plans. The site has also initiated deployment of the Lean/Six Sigma project management methodology. In 2011, a number of projects will be completed that address key business drivers for productivity: mill throughput, recovery and asset reliability. Current projects underway include:

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• secondary crusher performance for mill feed optimisation, • SAG mill discharge grate aperture performance, • water chemistry optimisation, and • SAG mill total charge optimisation. ENVIRONMENT AND COMMUNITY All activities are conducted in accordance with the Northparkes’ safety, health, environment and community policy and are aligned with Rio Tinto’s environment standards. Northparkes has also commenced life of mine planning and stakeholder consultation in accordance with the Rio Tinto closure standard, the relevant Rio Tinto community standards and associated documentation. The mine closure planning process is closely aligned with the principles outlined in ANZMEC/MCA Strategic framework for Mine Closure August 2004. Northparkes manages environmental risks as part of an integrated HSE management system. This system is audited and is certified under the ISO14001 certified Environmental Management System standard. The EMS outlines the minimum standard to ensure NPM manages its environmental aspects in a manner that is planned, controlled, monitored, recorded and audited, using a system that drives continual improvement. The key environmental targets and performance for 2009 and 2010 are summarised in Table 8. The principal environmental issues involve noise and dust management, managing land disturbance and ensuing rehabilitation, managing water quality and controlling site water. Rehabilitation at Northparkes incorporates the entire landholding and not just the area covered by the mining leases. Progressive rehabilitation conducted onsite is integrated with the surrounding land owned by Northparkes and is managed with a view to enhancing the regional landscape and native habitat values. The Northparkes mine closure plan (MCP) is consistent with the requirements of Condition 17 of Schedule 3 and relevant statement of commitments, Appendix 3 of the Project Approval (06-0026). The MCP is a ‘living’ plan that evolves with the ongoing operations at Northparkes, which are anticipated to continue until at least 2024. The mine closure strategy is based upon the Rio Tinto closure standard and associated guidelines. It comprises a mine closure vision, closure objectives, goals, targets, performance indicators and end-use of land selection criteria. A research project was commenced in 2008 with the Centre for Mined Land Rehabilitation (CMLR) to develop a tailings storage facility capping design for the closure of TSF1 and TSF2 to ensure maximum stability and minimal risk to the external environment. Stage 4 of the project, planned for 2011, includes field trials to test and validate the modelling results obtained in stage 3 and to gain confidence in the appropriateness of the final cover design. Northparkes recognises its responsibility to the community in which it operates and is committed to minimising the impacts from its operations. Northparkes is also committed to engaging with the local community to support and build capacity for economic growth and long term sustainable. Responsibility for community performance rests with the Manager for the Health, Safety, Environment, Community and Farms. The key stakeholders that Northparkes engages with on a regular basis include: the local community, traditional owners, neighbours and local landholders, local and state Government and Southern Cross Landholders. These relationships are managed through the following forums: • The Community Consultative Committee (CCC). Established in 2006, the CCC

comprises 15 members representing communities throughout the region including

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Parkes, Forbes, Peak Hill and Trundle. It has representatives from council, education, sports, business and other key organisations.

• Aboriginal Heritage Working Group (AHWG). The AHWG was established in 2008 and meets on a quarterly basis. It consists of representatives from the local Wiradjuri Community and Northparkes Mines and manages the implementation of the Aboriginal Heritage Management Plan. This plan provides the framework for the identification, assessment, monitoring and management of Aboriginal cultural heritage on site.

• Neighbours’ meetings. Neighbours meetings are generally held twice a year with the Mines’ closest neighbours to provide a feedback and a consultation mechanism.

• The Parkes Borefield Committee. This committee consists of representatives from Northparkes, Parkes Shire Council and the Southern Cross Landholders and meets on a quarterly basis to better understand user impacts on the local aquifer.

• New South Wales Minerals Council. Northparkes is an active member of the New South Wales Minerals Council (NSWMC) and is often involved in active debate influencing policies and legislation relevant to the mining industry.

Northparkes believes that to maintain a strong social license to operate it must have a positive influence on the long term development of the communities impacted by its operations. The Northparkes community investment program was established to address this. The program has three tiers: partnerships, sponsorships and donations. It focuses on four key areas: health, education and youth, environment and economic development. OCCUPATIONAL HEALTH AND SAFETY Northparkes follows the Rio Tinto risk management framework, and in particular the three-level risk assessment methodology. This methodology is designed to ensure the most appropriate tool and/or approach is applied to identify, evaluate and treat hazards and risks and allows for an escalation of risks to more formal complex quantitative assessments. Level one of the methodology involves hazard identification which is every Northparkes employees’ responsibility and is achieved through the Northparkes formal hazard identification process which is either a basic TRACK (think, recognise, asses, control and keep safety first) assessment or a team based job safety analysis (JSA). Hazards can also be identified, recorded and assigned to a physical work area to ensure future risk evaluations are completed and controls /actions implemented. Northparkes uses the Rio Tinto Business Solution to record and report this information (including the construction and management of its site risk register, incident and action management processes and audit records). A site wide risk register is generated from the level two (qualitative) risk assessment process and each leader is responsible for managing the risks in their particular work area. Risks that are evaluated as critical or high (with a major or catastrophic consequence) are escalated to a level three quantitative assessment. SQRA™ (semi quantitative risk assessment) is used to evaluate those safety risks requiring a level 3 assessment. SQRA risk scenarios are reviewed annually and a risk reduction (by calculating the reduced potential loss of life (PLL) score is measured annually). All health and safety risks are managed through the Northparkes integrated management system. This system conforms to Rio Tinto’s health, safety, environment and quality (HSEQ) management system standard and includes elements for management of change and contractor management. This system is audited on annually by an external accredited certification provider and incorporates the Rio Tinto health, safety and environment performance standards.

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Major health hazards and their risks include noise, dust exposure, manual handling and fitness for work. These are managed through risk assessment and the Rio Tinto health standards. Major safety hazards include vehicle interaction on and off site, moving parts on fixed or mobile plant, electrical safety, working at heights, confined spaces, underground fire and underground rock fall. These hazards are managed through the SQRA and the Rio Tinto safety standards. MANAGEMENT AND ORGANISATION Organisational structure Northparkes Mines operates with a non-unionised workforce, currently employing approximately 300 full time employees and approximately 400 contractors working at the mine site. Approximately 79 per cent of employees reside in Parkes, eight per cent in Forbes; two per cent in Peak Hill and the remainder reside in other smaller towns within the Parkes Shire (Rio Tinto, 2009). The organisational structure is illustrated in Figure 8. Table 9 summarises the site personnel by department. Human resources challenges Historically, Northparkes has intentionally recruited its operational workforce from the local area, which has resulted in a loyal and stable workforce with historically low (<10 per cent) annual turnover. Northparkes will continue to draw its operational workforce from the local community. Recent drought conditions in New South Wales and the transfer of manufacturing capacity out of Australia has resulted in a ready supply of skilled to semi-skilled employees, albeit with limited exposure to the mining industry. In response, NPM has developed extensive training and development systems that allow ‘newcomers’ to the mining industry to be quickly up-skilled. Ongoing salary pressures associated with the current mining boom are mainly impacting the professions of mining engineering, geotechnical engineering, geology and metallurgy and maintaining high-level productivity in an environment of ever-shrinking technical and managerial expertise is being addressed through a number of strategies: • collaboration within Rio Tinto People and Organisational Support to improve recruitment

within Australia, • overseas recruitment, • transfer programs within Rio Tinto, • programs with universities to allow students to obtain industrial experience during their

courses (ranging from three to 12 months), • increased use of specialist Rio Tinto staff in Brisbane and Melbourne, • salary packaging and flexible employment arrangements, • development of improved reward and recognition strategies, • focus on career development and career management within the Rio Tinto group, • focus on supporting students through their studies through scholarships, • apprenticeship programs, and • encouraging more women to join the mining sector. Northparkes uses a range of contracting and consulting services to support its business, ranging from casual labour supply contractors to address short-term staffing needs, to

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construction contractors who support major projects such as plant upgrades and construction of tailings storage facilities, to specialist maintenance services groups to technical consultants across its business. One of the largest groups of contractors involved at site are the maintenance contractors that support planned maintenance of mine and concentrator fixed plant during major maintenance shutdowns. Risk management A range of external and internal risks and opportunities have been identified through formal risk assessment that potentially impact Northparkes operations over the plan period. The following risks and opportunities have been identified and ranked according to their probability of occurrence and the potential intensity: • Major safety incident. Northparkes remains exposed to major process safety type

incidents. • Volatile metal prices. Whilst copper and gold prices are tracking historical highs, the

recent Global Financial crisis highlighted the speed at which prices could fall. In the case of copper, prices fell by 60 per cent in less than six months. Metal prices are expected to remain volatile in the short-medium term due to ongoing uncertainty about the pace of Chinese and Indian growth and the pace of recovery of the United States and European economic recoveries.

• Delayed E48 mine ramp-up. Northparkes’ 2011 production plan assumes 5.7 Mt of production from the E48 block cave mine. There is significant risk around achieving the planned production ramp-up of the E48 mine if there is incomplete or slow cave propagation or geotechnical instability on the extraction level (resulting from the undercutting method.

• Incomplete E26 Lift 2N/E48 Lift 1 reserve recovery. Northparkes 15 year mine life depends upon fully recovering the E48 Lift 1 and remaining E26 Lift 2/2N reserves. Approximately 35 per cent of the original E26 Lift 2 reserves were not recovered due to incomplete cave propagation, resulting in significant business disruption and lost value.

• Skills shortage. The ongoing resource boom in Australia is driving a skills shortage, ranging from engineers, geologists and metallurgists to trades and operators. The skills shortage is also driving a rapid escalation in salaries, putting significant pressure on operating and capital costs.

A qualitative risk analysis is conducted prior to commencement of all projects. A key output of the analysis is a project risk register which is updated throughout the project. The purpose is to identify all significant risks to a project and to develop strategies to manage the risks. The intent of the risk analysis is not to replace the safety and health risk management tools and systems already in place, such as semi quantitative risk analysis (SQRA). Further detailed safety and health risk assessments are carried out prior to starting project development and construction activities. An ESH Management Plan is developed at each project gateway, in line with Northparkes’ risk management framework (Table 10). The plan will be founded on a comprehensive risk management framework linking over-arching high-level semi-quantitative project risk assessments to mid-level quantitative risk assessments (eg WRACs) to task-based job safety analyses and standard operating procedures (Table 10). Risk assessments build upon the extensive onsite experience during the E26 Lift 2, E26 Lift 2 North and E48 Projects and industry experience.

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REFERENCES

Glen, R A, Walshe, J L, Barron, L M and Watkins, J J, 1998. Ordovician convergent margin volcanism and tectonism in the Lachlan sector of east Gondwana: Geology, v. 26, pp 751-754. Lye, A, Crook, G and Kolff van Oosterwijk, L, 2006. The Discovery History of the Northparkes Deposits, Mines & Wines Conference, 25-26 May 2006, Cessnock NSW [online]. Available from: <http://www.smedg.org.au/M&WProg.htm> [Accessed: 25 July 2011].

Rio Tinto, 2009. Northparkes Mines 2009 Sustainable Development Report [online]. Available from: <http://www.riotinto.com/documents/ReportsPublications/2009_Northparkes.pdf> [Accessed: 25 July 2011]. Rio Tinto, 2010, Northparkes Mines 2010 Sustainable Development Report [online]. Available from <http://www.riotinto.com/documents/Northparks_Mines_Sustainable_development_report_2010.pdf> [Accessed: 25 July 2011]. Rio Tinto’s interest in Northparkes Mines, Information Memorandum, April 2008. Simpson, C, Cas, R A F and Arundell, M C, 2000. The Goonumbla Caldera, Parkes, NSW: fact or fiction? in Understanding planet earth: Searching for a sustainable future (Eds: C G Skilbeck and T C T Hubble), Abstracts for the 15th Australian Geological Convention, University of Technology, Sydney, Australia, 2000.

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LIST OF TABLES Table 1 - Production summary. Table 2 - Northparkes ore reserves and resources, as at 31/12/2010. Table 3 - Northparkes’ block cave mines. Table 4 - Underground mining mobile equipment list. Table 5 - Process plant equipment list. Table 6 - Process plant consumables. Table 7 - Typical metallurgical balance. Table 8 - Northparkes key environmental targets and performance. Table 9 - Current site personnel numbers. Table 10 - Risk management framework. LIST OF FIGURES Figure 1 - Aerial view of Northparkes Mines’ operations (December 2010). Figure 2 - North-south cross-section showing step change project mineralisation targets. Figure 3 - North-south geological cross-section showing main resources. Figure 4 - North-south cross-section showing Northparkes’ block cave mines. Figure 5 - Schematic layout of the E26 Lift 2 block cave mine. Figure 6 - E48 Lift 1 mine material handling system. Figure 7 - Flowsheet of Northparkes concentrator. Figure 8 - Site management structure (May 2011).

Table 1. Production summary.

2010 actual 2011 plan Ore mined underground (Mt) 3.61 5.62 Ore sourced open pit (Mt) 1.61 0.14 Ore milled (Mt) 5.25 5.70 Head grade Cu (%) 0.82 0.88 Head grade Au (g/t) 0.51 0.48 Copper produced (t) 38 986 45 857 Gold produced (oz) 65 279 67 611

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Table 2. Northparkes ore reserves and resources, as at 31/12/2010.

Reserves - 31 December 2010

Tonnage (Mt) Copper (%) Gold (g/t) 75.51 0.82 0.32

Inferred Resources as of 31 December 2010

Tonnage (Mt) Copper (%) Gold (g/t) 270.50 0.55 0.26

Total Resources as of 31 December 2010

Tonnage (Mt) Copper (%) Gold (g/t) 287.83 0.57 0.26

Table 3. Northparkes’ block cave mines.

Block Block footprint

Block height

Reserve Draw points

Years of operation

E26 Lift 1 200 x 200 m 450 m 27.2 Mt at 1.44 %Cu and 0.41 g/t Au

122 1997-2003

E26 Lift 2 180 x 180 m 350 m 24.5 Mt at 1.21 %Cu and 0.47 g/t Au

102 2004-2007

E26 Lift 2N* 180 x 90 m >350 m 9.3 Mt at 0.82 %Cu and 0.23 g/t Au

69 2008-2010

E48 Lift 1 200 x 300 m 500 m 63.4 Mt at 0.85 %Cu and 0.34 g/t Au

214 2010 Onwards

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Table 4. Underground mining mobile equipment list.

Equipment type Number Sandvik LH514E Load Haul Dump Unit fitted with Automine software, 14 tonne bucket and 430 m long trailing cable

5

Diesel operated Toro 1400D loader 1 Single boom Tamrock drill rig with remote capabilities fitted with explosive charge up facilities

1

Single boom jumbo with remote capabilities fitted with drill string carousel for drilling longer holes in large hang-ups

1

Tamrock Commando 120 rock drill utilised for breaking loose oversize material in the draw points

1

Tamrock Commando 300 rock drill utilised for drilling loose oversize in the draw point as well as blocked draw points and hang-ups

1

Grader 1 ISUZU Table Top Truck 1 Franna Crane 14 tonne 1 CAT IT28G (IT) 1 Case1840 (Bobcat) 1

Table 5. Process plant equipment list

Item Number, size, manufacturer and installed power Comminution SAG mills Mod 1: 1 x Allis Mineral Systems, 7.3 m x 3.6 m, 2800 kW

Mod 2: 1 x Allis Mineral Systems, 8.5 m x 4.3 m, 4900 kW Pebble crushers Mod 1: 1 x Sandvik CH440, 220 kW

Mod 2: 1 x Sandvik CH440, 220 kW Secondary ball mills Mod 1: 1 x Allis Mineral Systems, 4.8 m x 7.6 m, 2800 kW

Mod 2: 1 x Allis Mineral Systems, 5.5 m x 9.4 m, 4900 kW Tertiary ball mills Mod 1: 1 x Allis Mineral Systems, 3.6 m x 5.5 m, 1300 kW

Mod 2: 1 x Falk, 4.05 m x 6.005 m, 1600 kW Flotation Flash flotation Mod 1: 1 x Outotec SK500, 1 x Outotec TC5

Mod 2: 1 x Outotec SK1200, 1 x Outotec TC5 Pre-flotation Mod 1: 1 x retrofitted cell

Mod 2: 1 x Outotec TC200, 225 kW Roughers/scavengers Mod 1: 2 x 4 cell banks, Dorr Oliver DO600 cells, 30 kW

Mod 2: 2 x 4 cell banks, Dorr Oliver DO1000 cells, 37 kW Cleaners Mod 1: 1 x Jameson 2250, 6 downcomers

Mod 1: 1 x Jameson 1000, 1 downcomer Mod 2: 1 x Jameson 2750, 8 downcomers Mod 2: 1 x Jameson 1500, 3 downcomers

Cleaner scavengers Mod 1: 1 x 4 cell banks, Dorr Oliver DO300 cells, 15 kW Mod 2: 1 x 4 cell banks, Dorr Oliver DO300 cells, 15 kW

Dewatering Concentrate thickeners Mod 1: 1 x Superflo 10m

Mod 2: 1 x Superflo 10m Concentrate ceramic filters

Mod 1: 1 x Outokumpu CC-30 Mod 2: 1 x Outokumpu CC-30

Tailings dewatering 1 x Superflo 28.5 m

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Table 6. Process plant consumables.

Item g/t Comminution SAG – 125 mm steel balls 710 Ball Mills – 65 mm steel balls 840 Ball Mills – 30 mm HiCr balls 110 Flotation PAX 4 DSP601 Promotor 10-12 NaHS 25-40 DSF611 Frother 10-12 DSF007 Frother (scavs only) 2 Dewatering AN934SH Tailings flocculant 30-33

Table 7. Typical metallurgical balance

Stream Mass (%) Grade Cu (%)

Grade Au(g/t)

Distribution Cu (%)

Distribution Au (%)

Feed 100 0.82 0.51 100 100 Rougher concentrate (excl. flash con)

4 10-15 4-7 75 50

Final concentrate

2.5 32-35 15-20 91 77

Tailings 97.5 0.07-0.09 0.10-0.15 9 23

Table 8. Northparkes key environmental targets and performance.

2009 Plan

2009 Actual

2010 Plan

2010 Actual

Six per cent reduction in total green house gas emissions by 2013 (t CO2-e)

217 928

209 017 209 446 208 572

Freshwater use, per tonne of product by 2013 (ML/t product)

34 34.64 32 41.08

4.3 per cent increase (to 1307 ML) in use of recycled water (as a proportion of total water used) by 2013.

26.9 33.5 27.9 32.47

Five year cumulative rehabilitation (disturbance /rehab ratio) from 2009 to 2013

0 0.62 0.33 0.67

Electricity consumption per tonne of ore milled by 2011 (GJ/t ore milled)

0.1479 0.14 0.1458 0.149

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Table 9. Current site personnel numbers.

Department Actual

manningVacant roles Total

Executive 3 2 5 Ops - mining 74 15 89 Ops - ore processing and logistics 43 3 46 Ops - asset management 83 12 95 Commercial 22 6 28 Business effectiveness 6 4 10 HSEC&F 22 5 27 People and capability development 14 0 14 Projects 5 0 5 Projects - infrastructure 5 0 5 Projects - mining studies 4 4 Projects - geoscience 16 1 17 Projects - tunnel boring 1 0 1 Total 298 48 346

Table 10. Risk Management Framework.

Risk assessment hierarchy Risk assessments Semi-quantitative risk assessments (SQRAs) and qualitative risk assessments (QRAs)

Northparkes Minesite semi-quantitative risk assessment (SQRA) E48 project semi-quantitative risk assessment (SQRA) step change project risk analysis

Activity-specific QRAs Undertaken for each contract package and each major development stage over the project life

Mobile fit for purpose QRAs Undertaken for all equipment procured and utilised onsite over the life of the project

Project risk register Utilising the Rio Tinto RioRisk spreadsheet and ultimately the RioRisk software package once released

Standard operating procedures (SOPs)

SOPs developed for project development and construction activities based on detailed job safety analyses (JSAs)

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Conveyor De

4

1

nge ture

25

arkes Mines

n showing f

eclines

E48

Lift 1Not

mined

Lift 2

eclines

E48

Lift 1Not

mined

Lift 2

s’ operation

future projec

ConcentratorConcentrator

ns (Decemb

ct mineralis

E22

Lift 1

r E22

Lift 1

r

ber 2010).

sation target

Monzonite Stock

E27

1

1 kilometre

Monzonite Stock

E27

1

1 kilometre

ts.

26

Figure 3. North-south geological cross-section showing main resources.

Figure 4. North-south cross-section showing Northparkes’ block cave mines.

Quartz Monzonite PorphyryMonzonite StocksAltona Fault

MonzodioriteLatite dominant volcanics0.5% Cu

Latitic SedimentsTrachytic SedimentsU/G Drives

0 1 km

E26 E48 E22 E27

Hoisting Shaft

MainDecline

9800 Level

Conveyor Declines

Access Decline

9450 Level

S N

E26L1

E48

L2 L2N

L1L1

27

Figure 5. Schematic layout of the E26 Lift 2 block cave mine.

Access Decline

Extraction Level

Draw Bell

Undercut Level

Crusher Chamber

Extraction Drive

North South

Conveyor Drive

Ore Body

28

Item Description Capacity 1 Load haul dump units, Tamrock 1400E 12 t bucket 2 ROM bin 800 t live 3 Plate feeder 1000 t/h 4 Gyratory crusher, BK160-190 1000 t/h 5 Crusher ore bin 400 t live 6 Vibratory feeder 1050 t/h 7 Conveyor, 124CV013 (1000 mm belt width, 35° trough, 3.0 m/s) 1050 t/h 8 Belt weigher 1050 t/h 9 Tramp magnet(self-cleaning type) - 10 Tramp magnet (manual cleaning type) - 11 Metal detector - 12 Conveyor, 124CV010 (1000 mm belt width, 35° trough, 3.1 m/s) 1050 t/h 13 Fixed rock breaker - 14 Hydroset trolley and ore pass cover plate - 15 Ventilation fans - 16 60 t SWL and 12 t overhead crane -

Figure 6. E48 Lift 1 mine material handling system.

121CV008

ORE BODY CAVE

124CV010

EXISTING SHUTTLE CONVEYOR AND LIFT 1 ORE BINS

DRAW POINTS

TRAMMING LEVEL

E26 LIFT 2 CRUSHING AND CONVEYING SYSTEM

E26 LIFT2E26 LIFT2

124CV011 124CV010

1

2 16

13

14

3

4

5

6

9

TRAMP BIN87

12

15

1110

124CV012

124CV013

W/S AREA

DRIVE THROUGH ACCESS

RELOCATED FOR CLARITY

29

Figure 7. Flowsheet of Northparkes concentrator.

30

Figure 8. Site management structure (May, 2011)

Managing Director

Operations

Underground Mining

Ore Processng

Asset Management

Projects

Geoscience

TBS

Infrastructure

Environment & Community

Mine Design

Health, Safety, Environment,

Communitites and Farms

Health, Safety & Emergency Response

Health, Safety & Emergency Response

Farms

Underground Safety

People & Capability Development

Human Resources

Surface Training

Underground Training

Finance

Finance and Accounting

Business Effectiveness