Processing Technology vs Nickel Laterite Ore Characteristic Agus Superiadi PT Inco.Tbk

Presentation Outlines Types of Nickel Deposit World Nickel Mineral Resources Nickel Laterite Development Processing Technology of Nickel Laterite Processing vs Ni Laterite Ore Characteristic Summary

Types of Nickel Deposits Sulphide nickel deposits Nickel as nickel sulphide  pentlandite, millerite Nickel ores processed through milling and smelting Laterite nickel deposits Oxide Ni deposits: Ni as hydroxide in the ferruginous zone Clay silicate deposits: Ni as clay silicate Hydrous silicate deposits: Ni as hydrous-silicate in saprolite Nickel ores processed through pyro-metallurgy (smelting) or hydro-metallurgy (leaching)

WORLD’S LAND-BASED Ni RESOURCES Mt Ore % Ni Contained Nickel Relative SULPHIDES 10,594 0.58 62 31% LATERITES 10,382 1.32 140 69% TOTAL 20,976 0.96 202 100%

WORLD Ni PRODUCTION & RESOURCES PRIMARY Ni PRODUCTION WORLD Ni RESOURCES 60% 70% SULPHIDE LATERITE LATERITE SULPHIDE 40% 30%

LATERITE vs. SULPHIDE DEPOSITS CUBA PHILIPPINES INDONESIA NEW CALEDONIA AUSTRALIA LATERITES SULPHIDES

World Nickel Laterite Deposits Albania Greece Cuba India Burma Dominican Republic Ivory Coast Philippines Guatemala Venezuela Ethiopia Columbia Burundi Indonesia Zimbabwe Brazil PNG Madagascar Australia New Caledonia Producing Countries Non Producing Countries

World Nickel Laterite Resources (Distribution by Contained Nickel) Other America Caribbean 4% 8% Africa 25% 8% Australia 8% Philippines New 11% Indonesia Caledonia 16% 20%

DEFINITION OF LATERITES Nickel laterites are: Residual soils Have developed over mafic/ultramafic rocks Through processes of chemical weathering and supergene enrichment Under tropical climatic conditions Laterites are source of metals: Ni, Co, Cr, Fe (from laterites derived from ultramafic rocks) Al (from laterites derived from aluminous rocks)

Laterisation

LATERITE PROFILE On Unserpentinised Peridotite, Sorowako Red Laterite (Hematite) Yellow Laterite (Limonite) Slide 9: Typical laterite profile in a road cut: dark limonite overburden above the red line; limonite low grade to medium grade between the red and the green lines; and saprolite below the green line. At the road level some signs of possible bedrock pinnacles are exposed. Imaginary drill holes A,B,C at about 25 meter spacing in this photo would return completely different profile interpretations in terms of quantity and position of each of the three main layers. This high degree of variability of the laterite adds risk to exploration in the early stage that grade and tonnage estimates will not be representative for economic studies. Only detailed exploration will provide the sampling to reduce this risk. Saprolite zone Bedrock pinnacle

Considerations for developing a nickel laterite project Nickel grade; cobalt grade Resource tonnage / Life of Mine / scale of operation Ore chemistry and mineralogy Upgradeability of ore Process selection Availability of cheap power supply Selection of fuel Availability of raw materials: water, silica flux, aggregate Availability of infrastructure Location of project Mining method Environmental considerations Negotiations with local and central governments Funding of the project Selection of engineer and contractor

PROCESSING OF Ni LATERITES Pyrometallurgical processing (Ore is melted) Ferro-nickel Ni-matte Ni Pig Iron Hydrometallurgical processing (Leaching by acid) PAL (Pressure acid leaching) – HPAL AL (Atmospheric Leaching) Heap Leaching Combined pyro and hydro process (Caron) (Ore is reduced at high temperature, then leached)

Ferro-Nickel Projects in the world Owner Country Remarks Cerro Matoso BHP-B Columbia Codemin Anglo Brazil Doniambo SLN/Eramet New Caledonia Exmibal Ex. Inco Guatemala Mothballed Falcondo Falconbridge Dominican Rep. Fenimark FENI (govt.) Macedonia Closed Hyuga Sumitomo Japan Imported ore Larymna Larco Greece Loma de Hiero Venezuela Morro do Niquel Oheyama Nippon Yakin Onca-Puma Vale Inco PAMCO Nippon Steel Pomalaa ANTAM Indonesia Some imported ore Nickel-Matte Projects of the world Project Owner Country Remarks Sorowako PT Inco Indonesia Doniambo SLN/Eramet New Caledonia

HPAL Projects of the world Owner Country Remarks Moa Bay Cuba Niquel Cuba First HPAL Bulong Australia Shut down Cawse Norilsk Murrin-Murrin Minara Coral Bay Sumitomo Philippines Goro Vale Inco New Caledonia Under construction Ramu River PNG Ravensthorpe BHP-B CARON Projects of the world Project Owner Country Remarks Nicaro Union del Niq Cuba Punta Gorda Nonoc Philippines Closed QNI BHP-Billiton Australia Imported ores Tocantins Niquel Toc. Brazil

Heap Leach Projects of the world Owner Country Remarks Caldag European Nickel Turkey First Heap Leach project Ravensthorpe BHP-B Australia Part of flow sheet Murrin-Murrin Minara Expansion of project Piaui Vale Brazil Being fast-tracked for production

PYROMETALLURGICAL PROCESSING Ferro-Nickel Process Upgrading in the mine Drying of ore Upgrading after drying Calcining Electric Furnace Smelting Refining Furnace Ferro-Nickel Product 20 – 50% Ni Nickel-Matte Process Upgrading in the mine Drying of ore Upgrading after drying Calcining Electric Furnace Smelting Converting Nickel-Matte Product 78% Ni

PYROMETALLURGY Important concerns: Slag should not attack refractory (S/M ratio) Melting temperature should be suitable (S/M; Fe) Olivine should not be introduced to the furnace Appropriate reduction of ore prior to smelting Ni/Fe ratio in the ore for ferro-nickel operation

HYDROMETALLURGICAL PROCESSING HPAL Process Ore Preparation: wetting, screening, crushing, ore beneficiation Pre Heating through flash steam Pressure Acid Leach in autoclave Heat recovery from leached pulp CCD thickening and washing Neutralisation of pregnant solution Precipitation of metals by adding H2S/alkali Solid/liquid separation Ni/Co products as mixed sulphides, oxides, hydroxides Heap Leaching Process Ore Preparation: wetting, screening, crushing, ore beneficiation Heap Formation Acid Dripping Pregnant solution Sequential Precipitation of metals Neutralization Ni/Co concentrate

HYDROMETALLURGY Important concerns: HPAL Heap Leaching Amounts of soluble Mg and Al in ore (acid consumers) Acid to ore ratio required for process Minimum operating temperature required to leach What is the appropriate pressure during leaching Retention time in the autoclave Rheological behaviour during slurrying How to recover metals in the back end of processing What product to make Heap Leaching Clay content Fe content Moisture content Weather

Hydro vs Pyro Note: The selection of processing technology must consider: Ore characteristic (Chemistry and Mineralogy) Ni/Co grades (include potential upgrading) Metal recovery Mineability (Ore thickness and continuity) Capital and Operating costs (potential hydro-electric power, Residual Storage Facility, Water source, Limestone source, Existing infrastructure, etc) Market demand

Hydro vs Pyro

Pyrometallurgy Process Main Feed Electricity Require Capital Cost Operating Cost Fe-Ni Smelting Saprolite Very High High Ni Matte Ni Pig Iron Limonite Moderate

Hydrometallurgy Process Main Feed Electricity Require Capital Cost Operating Cost HPAL Limonite Low High Caron Saprolite Moderate Very High Heap Leach Very Low Chloride Leach

SUMMARY Ore Characteristics (chemistry and mineralogy) are very critical in selecting processing technology. HPAL is a preferred technology (if the ore is rich in limonite) because less energy required. Ferronickel and Nickel matte smelter is a good alternative for saprolitic laterite ore with potential hydro electric power. Heap Leach and NPI are attractive since less capital investment required. A Feasibility Study (Geology, Mining, Processing including Metallurgical testworks, Infrastructures, AMDAL, etc) is required to justify the project execution.

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