1. 12 October 2011 Exxaro’s energy, climate change & renewable energy journey

2. Energy and climate change environment in SA Exxaro’s energy and carbon journey Energy identified as risk issue - Lekgotla - Clean Energy Forum Exxaro Business Growth structure, including Energy formalised - Energy & Carbon Framework/ Program - Energy business strategy and vision formalised - E&CM - Energy projects development - Eco housing - E&CM - Energy business formation 2006 2007 2008 2009 2010 2011 Regional electricity supply shortage National Load shedding Regional electricity supply shortage National Load shedding REFIT published REFIT published Draft IRP 2010 Draft IRP 2010 Finalised IRP 2010 Finalised IRP 2010 DoE, RE IPPPP Cape Town local load shedding SA Emissions Commitments at COP15 Electricity Price up 22% Climate Change Green Paper

3. The current energy environment presents both risks and opportunities to Exxaro

4. Energy and carbon management framework and programme Energy identified as risk issue - Lekgotla - Clean Energy Forum Exxaro Business Growth structure, including Energy formalised - Energy and Carbon Framework/ Program - Energy business strategy and vision formalised - E&CM - Energy projects development - Eco housing - E&CM - Energy business formation 2006 2007 2008 2009 2010 2011

5. Purpose of the Energy Management Working Group Become the centre of excellence for energy management in Exxaro to: Facilitate a framework within which energy consumption and initiatives can be managed actively to achieve targets Providing a forum to enable and integrate the efforts of Exxaro in energy management Develop and support the implementation of best practices in energy management Communicate guidelines and achievements to all stakeholders Become the centre of excellence for energy management in Exxaro to: Facilitate a framework within which energy consumption and initiatives can be managed actively to achieve targets Providing a forum to enable and integrate the efforts of Exxaro in energy management Develop and support the implementation of best practices in energy management Communicate guidelines and achievements to all stakeholders

6. STRATEGIC STAIRCASE & PROPOSED THRUST OWNERS FUTURE INTENT 2012 Thrive in low carbon economy Pre-empt legislation Improve competitive intelligence Participate ito Clean energy, renewables, carbon trading,co- generation Brand, image, perception Capacity/capability CI drive on energy CURRENT REALITY 2007 High C Economy Reactive to legislation Identified threat and commitment Part of third world – huge window of opportunity High level management commitment Energy Strategy ENERGY EFFICIENCY DRIVE MIKE HUGHES IMPLEMENT CLEANER TECHNOLOGIES THOMAS GARNER THRIVE IN LOW CARBON ECONOMY MIENTJIE VD VYVER BRAND, IMAGE, PERCEPTION, SUSTAINABLILTY RAMESH CHHAGAN MAJOR ACTIVITIES Knowledge sharing structures (By mail group) Quantify current Carbon footprint Track Energy efficiency UNDERSTAND AND PRE-EMPT ENVIRONMENTAL REGULATORY ENVIRONMENT JOSEPH MATJILA MAJOR ACTIVITIES ID and review current energy efficiency levels Benchmark with industry ID intiatives to improve Energy efficiencies Implement initiatives Create metrics to continiously review energy efficiencies Energy Forum – support MAJOR ACTIVITIES Select technologies and value propositions for Clean coal Carbon sequestration Clean energy Renewable energy Co-generation IPP Thorium Reporting tandards/protocols MAJOR ACTIVITIES Carbon trading Understand carbon trade and create value Baseline current operations Current projects : Focus on energy as part of investment criteria Define low hanging fruits in current business Technical project reviews BI reviews MAJOR ACTIVITIES Succes stories Communication plan Source guidance – Nicholis Stern? SME Development Identify consultants Brief competitive intelligence sources to look for information Roadshow Define capacity or skills gap to achieve success Define funding and incentive possibilities Protocols

7. In response to the changing energy environment, a clean energy initiative was launched (2007) CURRENT REALITY High Carbon Economy Reactive to legislation Identified threat & commitment Part of third world – huge window of opportunity High level management commitment Energy Strategy FUTURE INTENT Thrive in low carbon economy Pre-empt legislation Improve competitive intelligence Participate in o Clean Energy o Renewable resources o Carbon trading o Co-generation Brand, Image Perception Environmental regulatory environment Joseph Matjila Environmental regulatory environment Joseph Matjila Energy efficiency management drive Mike Hughes Energy efficiency management drive Mike Hughes Mitigation opportunities and clean technologies Mitigation opportunities and clean technologies Tommy Garner Low carbon economy Brian Day Low carbon economy Brian Day Sustainability reporting Tsheko Ratsheko Sustainability reporting Tsheko Ratsheko Energy procurement Energy procurement Solwazi Majola

8. Reporting In 2009, an Energy and Carbon Management strategic framework was developed CURRENT REALITY High Carbon Economy Reactive to legislation Identified threat & commitment Part of third world – huge window of opportunity High level management commitment Energy Strategy FUTURE INTENT Thrive in low carbon economy Pre-empt legislation Improve competitive intelligence Participate in o Clean Energy o Renewable resources o Carbon trading o Co-generation Brand, Image Perception Sustainability Reporting Tsheko Ratsheko Sustainability Reporting Tsheko Ratsheko The Future Intent should be captured in the Energy Vision for Exxaro Regulatory and Stakeholder Requirements Sustainability Reporting Tsheko Ratsheko Sustainability Reporting Tsheko Ratsheko Assurance Environmental Regulatory Environment Joseph Matjila Environmental Regulatory Environment Joseph Matjila Energy Efficiency Management Drive Mike Hughes Energy Efficiency Management Drive Mike Hughes Mitigation Opportunities and Clean Technologies Mitigation Opportunities and Clean Technologies Tommy Garner Low Carbon Economy Brian Day Low Carbon Economy Brian Day Energy Procurement Energy Procurement Solwazi Majola More than Environmental Regulations are relevant Sustainability Strategy Exxaro Vision, Mission and Values Energy and Climate Change Principles and Policies Energy Project Development and Implementation Operational Management Energy Efficiency Management Drive Mike Hughes Energy Efficiency Management Drive Mike Hughes Mitigation Opportunities and Clean Technologies Mitigation Opportunities and Clean Technologies Tommy Garner Low Carbon Economy Brian Day Low Carbon Economy Brian Day Energy Procurement Energy Procurement Solwazi Majola Energy Trading Platform Energy and Carbon Footprint Data Energy Efficiency Improvement Projects Energy and Carbon Management Guidelines for Capital Projects Clean Technology Integration Management and Monitoring Processes and Systems Platform for Electricity Trading (PCP/RTC, Cogen and Renewables) Energy Efficiency Improvements at Current Operations Energy and Carbon Efficient Capital Project Implementation Clean Energy Project Implementation Energy Consumption Management Consumption Management Platform The Energy and Climate Change Strategy must be aligned with Exxaro’s strategic direction To achieve the vision, we need to focus on efficiencies in current operations and projects to improve our performance The intended outcome of our focus areas Energy and carbon footprint data for the various applications and at all levels of the organisation Proactive management of day-to-day consumption at the operational, CB and corporate level Enabling Exxaro to effectively manage the requirements of the PCP Projects to improve the energy efficiency of existing operations Guidelines to ensure that new operations are energy efficient Developing and implementing clean energy projects e.g. wind energy and Onsite Internal and external assurance to ensure implementation of the strategy at all levels Market Protection and Opportunity Energy and climate change initiatives must contribute to Exxaro’s ability to be a supplier of choice in the market place

9. A strategic framework was established Assurance Reporting Sustainability Strategy Exxaro Vision, Mission and Values Energy and Climate Change Principles and Policies Energy Project Development and Implementation Operational Management Energy Efficiency Improvement Projects Energy and Carbon Management Guidelines for Capital Projects Becoming Carbon Neutral Energy Trading Platform A Platform for Electricity Trading (PCP/RTC, Cogen and Renewables) Energy Efficiency Improvements at Current Operations Energy and Carbon Efficient Capital Project Implementation Clean Energy Project Implementation Regulatory and Stakeholder Requirements Consumption Management Platform Energy Consumption Management Energy and Carbon Footprint Data Management and Monitoring Processes and Systems Market Protection and Opportunity

10. Implementation is supported by a governance process Exxaro Exco Energy and Carbon Management Steercom Energy and Carbon Management Working Group Focus Area Initiatives Exxaro Board; S&SD Board Sub-Committee

11. Energy & Carbon Management Strategy Framework

12. Development of new energy business Energy identified as risk issue - Lekgotla - Clean Energy Forum Exxaro Business Growth structure, including Energy formalised - Energy and Carbon Framework/ Program - Energy business strategy and vision formalised - E&CM - Energy projects development - Eco housing - E&CM - Energy business formation 2006 2007 2008 2009 2010 2011

13. VISION Become the leading cleaner energy Independent Power Producer in Southern Africa, serving an expanding energy market VISION Become the leading cleaner energy Independent Power Producer in Southern Africa, serving an expanding energy market Energy Newco’s vision … a share in 16,5 GW installed capacity by 2025

14. Development of a balanced portfolio of projects Key focus areas for Energy Newco Formation of Energy Newco

15. Development of new energy business Energy identified as risk issue - Lekgotla - Clean Energy Forum Exxaro Business Growth structure, including Energy formalised - Energy and Carbon Framework/ Program - Energy business strategy and vision formalised - E&CM - Energy projects development - Eco housing - E&CM - Energy business formation 2006 2007 2008 2009 2010 2011

16. Project development Project Development Continuous development of the value of Energy Newco Own Projects Acquisitions IPP Procurement Programme

17. Completed Business Case Concept Screening Investment Decision Conditions Precedent Transfer to operations West Coast Wind Namakwa Onsite (100% Exxaro owned) Energy project pipeline Tsitsikamma Community Wittekleibosch Mittal Steel Saldhana Base Load Coal Thabametsi SolarCogenerationGas & Fuel Wind Tsitsikamma Expansion Base Load IPP Reductants Onsite (100% Exxaro owned) Samancor Chrome AssMang Mpumalanga Biodiesel Feasibility Build Operate Idea generation & desktop studies Concept studies Pre-feasibility Lephalale PV Possible acquisitions Botswana CBM (100% Exxaro owned)

18. Projected cumulative generation capacity Of which Energy Newco will have circa 50% effective ownership

19. Development of new energy business Energy identified as risk issue - Lekgotla - Clean Energy Forum Exxaro Business Growth structure, including Energy formalised - Energy and Carbon Framework/ Program - Energy business strategy and vision formalised - E&CM - Energy projects development - Eco housing - E&CM - Energy business formation 2006 2007 2008 2009 2010 2011

20. The eco housing project reflects Exxaro’s commitment to sustainability in the fast growing town of Lephalale Exxaro’s commitment to sustainability The need for sustainability Global warming and impact on resources

21. The Exxaro commitment to sustainable development made the need for green housing non-negotiable To reduce Exxaro’s carbon footprint Engineering News – 29 April 2009 Garner said that Exxaro was also forming alliances with companies in the renewable energy field in wind, solar and coalbed methane gas…. “We really want to be big in wind, and may even move up to 1 000 MW, but let’s talk about 500 MW for a start,” Garner said The introduction of energy efficiency goals in the strategy of the DME Exxaro Publication - Date released: 5 June 2008 Exxaro commits itself to both national and international protocols aimed at encouraging countries and industries to adopt more responsible energy use programmes. In particular, the company has committed to optimising energy use by improving energy efficiency by 15% by 2015, as outlined in the national energy efficiency accord of the Department of Minerals and Energy for the industrial and mining sectors. There is a constraint on the availability of resources in Lephalale (i.e. water)

22. A mixture of housing types to cater for differing needs and employment grades were built in and around Lephalale Housing units were situated within a ±7km radius of the community centres to create a mutually beneficial relationship between the Housing residents and community businesses Allocation of housing/flat units: 81 housing units in Onverwacht 40 housing units in Marapong 284 flat units in Onverwacht 292 flat units in Marapong *Housing standards same across all units Allocation of housing/flat units: 81 housing units in Onverwacht 40 housing units in Marapong 284 flat units in Onverwacht 292 flat units in Marapong *Housing standards same across all units

23. A range of green design principles were applied to minimise the impact on the environment and community Waterwise and Low Maintenance Gardens Profilence Shower Heads Thermov ents

24. Through the Lephalale Housing Project Exxaro has demonstrated its commitment to sustainability and the environment Implementing R26m worth of green technologies principles to: - Reduce the electricity consume in Lephalale - Reduce the water consumed in Lephalale - Protecting the natural environment (e.g. trees) - Reducing living and maintenance costs to home owners Developing the local Economy by: - Investing R31m in local businesses - Employing 50% of construction workers locally - Transferring skills via training programmes - Providing BBBEE opportunities Constructing affordable housing units to allow the mine employees the opportunity to own the housing units in the future

25. Energy and climate change environment in SA In conclusion Energy identified as risk issue - Lekgotla - Clean Energy Forum Exxaro Business Growth structure, including Energy formalised - Energy & Carbon Framework/ Program - Energy business strategy and vision formalised - E&CM - Energy projects development - Eco housing - E&CM - Energy business formation 2006 2007 2008 2009 2010 2011 Regional electricity supply shortage National Load shedding Regional electricity supply shortage National Load shedding REFIT published REFIT published Draft IRP 2010 Draft IRP 2010 Finalised IRP 2010 Finalised IRP 2010 DoE, RE IPPPP Cape Town local load shedding SA Emissions Commitments at COP15 Electricity Price up 22% Climate Change Green Paper