CONTRACTOR MANAGEMENT AT XSTRATA COAL

INDEX Location of sites Employees vs. Contractors Contractor selection phase Pre-engagement operational phase Engagement operational phase Post engagement / project completion phase Completion stage Common problems experienced Future initiatives

Location of sites Middelburg Witbank Ogies Tweefontein Division iMpunzi Division Rietspruit Phoenix Tavistock ATC ATCOM Phoenix Tavistock ATC ATCOM Waterpan Boschmans Witcons South Witbank Goedgevonden Waterpan Boschmans Witcons South Witbank Goedgevonden Mpumalanga Division DTJV - Douglas DTJV - Middelburg Tselentis Spitzkop Tselentis Spitzkop

Employees vs. Contractors MineTons/mthNo. emplNo. Contr% of Workforce Arthur Taylor ATCOM Boschmans Goedgevonden Phoenix South Witbank Spitzkop Tavistock Tselentis Waterpan Witcons

Employees vs. Contractors Strength Injuries Contractors contribute to 31% of the total number of injuries

Management Of Contractors CONTRACTOR SELECTION PHASE PRE-ENGADGEMENT OPERATIONAL PHASE OPERATIONAL PHASE The company Preparation Evaluation criteria Tender Assessment in accordance with Company Procedure Selection / Rejection Completion of all documentation Including contract, indemnities, returns, etc Completion of pre-emptive risk identification and assessment Assessment and response to pre-emptive risk identification and assessment by the company. Induction / Training Medical Examination (certificate of fitness and medical surveillance) Attendance at HS and Operational Meetings Over inspection / Monitoring / Auditing POST-ENGADGEMENT OPERATIONAL PHASE Review contractual performance / delivery of services Review compliance with obligations

Contractor Selection Phase Need for contractor employment identified Scope of work defined Evaluation criteria Tender assessment – company procedure Company actions Selection

Pre-engagement / Operational Phase Documentation, i.e. contract, indemnities, appointments, etc Pre-emptive risk identification & assessment Response to risk identification & assessment Induction training Medical examination (C.O.F. & medical surveillance)

Engagement / Operational Phase Monitoring performance, i.e.: H&S Meetings Risk management programme Occupational hygiene controls monitored Incident / injury reports Daily, weekly, monthly returns submitted First aid programme Induction Medical surveillance Health & safety training programme

Engagement / Operational Phase Issue & control of PPE Equipment inventory Logbooks, registers, appointments Fire drills Emergency preparedness / escape routes Vehicle / equipment pre-use checks Planned task observations H & S Audits Hazardous substances Maintenance management

Engagement / Operational Phase OEM training / authorisation procedure Approval of deviations / modifications to equipment Approval – temporary workers Approval – contract variation orders Non-compliances Special precautions for hazardous work

Post-Engagement / Project Completion Phase Review of contractual performance Delivery of service Quality assurance Review of compliance with obligations Cold commissioning of system Hot commissioning of system Warranty and maintenance period confirmed Contractor documentation Security cards returned

Post-Engagement / Project Completion Phase Exit medical examinations Equipment removal Site area cleared, clean & safe Acceptance of ownership

Common Problems experience Limitation on the number of specialist contractors in the market Time restraints in selection and appointment process Quality of contractors supervisors and employees Record keeping on the movement of contractors employees between mines Desertion of contractors employee without completing exit medical examinations

Future initiatives Preferred contactors list Electronic data base with program to generate tender documents