Sustainability Report 2011 New World Resources Plc Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 2.1 ≥ GRI 2.2 ≥ GRI 2.3 1 ≥ GRI 2.4 ≥ GRI 2.5 Contents NWR at a glance ≥ GRI 2.6 ≥ GRI 2.7 ≥ GRI 2.9 ≥ GRI DMA EC Market presence

001 Overview Signposting We have three principal subsidiaries which make About us 001 NWR at a glance up our operations: We use the following symbols to point 002 Highlights 2011 NWR is one of the leading producers of hard coal and coke in Central Europe. 004 to sources of further information. Our operations The Company has three key subsidiaries: OKD, a.s. (Czech Republic), OKK 006 Chairman’s statement Koksovny, a.s. (Czech Republic) and NWR KARBONIA S.A. (Poland). 010 Sustainability executives Q&A Related sections within this OKD, a.s. (‘OKD’) 014 Scorecard Sustainability Report 2011 Extracts coking and thermal coal in four active As of 1 January 2012 NWR had 385 million tonnes of coal reserves using 016 About this Report Related information online at mines in the Upper Silesian Coal Basin. OKD is the JORC classification methodology2. The Group has a strategic position 018 Our approach www.newworldresources.eu the only hard coal mining company in the Czech in Central Europe and delivers its output to a number of blue-chip 020 Sustainability strategy Republic. customers in the region, including ArcelorMittal, ČEZ, Dalkia, Moravia Steel, 022 Sustainable development governance ThyssenKrupp, U.S. Steel, Verbund and voestalpine. 025 Materiality 026 Ethics and society In 2005 the limited liability company New World Resources B.V. was 030 Relations and communication with stakeholders established as a holding company for mining operations, coking plants and 034 Sustainable risk assessment OKK Koksovny, a.s. (‘OKK’) certain other activities of the current NWR Group. New World Resources N.V. 036 Responsible mining practices throughout the life cycle OKK, the coking subsidiary of NWR, is Europe’s (‘NWR NV’) is a company founded in the Netherlands in 2008. It was listed 038 Our people largest producer of foundry coke. on the London, Prague and Warsaw stock exchanges in May 2008. The NWR 040 Human resources strategy and employee care flotation was the biggest initial public offering (IPO) on the London Stock 042 Employment Exchange in 20083. In 2011 the Company was reincorporated in the United 043 Structure of the NWR Group workforce Kingdom as New World Resources Plc, and was included in the FTSE 250 UK 044 Employee remuneration PLC index. NWR is also part of the FTSE 350 Mining Index and remains listed 045 Trade Unions NWR KARBONIA S.A. (‘NWR KARBONIA’) on the London, Prague and Warsaw stock exchanges. The Company’s head 046 Safety Polish development projects are managed by the office is in the Netherlands. 049 HBZS – the mining rescue service subsidiary NWR KARBONIA. The biggest of these 052 Continuous Improvement Programme projects is the construction the Dębieńsko mine NWR is one of the largest European industrial groups (in terms of assets and 053 Employee training and education in southern Poland. revenues) and one of the biggest private employers in the Czech Republic. 054 Environment 056 Strategy 057 Reclamation and biodiversity conservation 066 Emissions 070 Energy 074 Water 078 Waste 080 Materials 081 Health and safety impacts of our products NWR Group structure 082 Community New World Resources Plc 084 Community cooperation strategy 086 NWR Group’s community involvement 094 Mining activity and the community New World Resources N.V. 098 Supply chain 100 Strategy 102 Additional information OKD, a.s. OKK Koksovny, a.s. NWR KARBONIA S.A. NWR Communications, s.r.o. 102 GRI application level check statement 103 Key sustainability data summary 106 Subsidiaries’ organisational structures OKD HBZS, a.s. 108 GRI content index 118 Glossary 1 New World Resources Plc is referred to in the Report as ‘NWR’ or ‘the Company’. NWR together with its subsidiaries are jointly referred to as ‘the Group’ or ‘NWR Group’. 2 Full name: Joint Ore Reserves Committee (www.jorc.org). The Company employs a certified geologist who draws up assessments of the size of reserves Exchange rates used throughout this report are 24.590 CZK/EUR and 4.121 PLN/EUR. in cooperation with a JORC certified specialist. The Sustainability Report 2011 is referred to as the ‘Report’. 3 Source: Dealogic (www.dealogic.com). New World Resources Sustainability Report 2011

‘Sustainable development is an integral part of ‘This Sustainability Report brings an objective look at the non-financial Overview NWR’s business strategy. The attention NWR pays impacts of NWR Group’s activities, backed up by objective qualitative to this area enables us to maintain social consent and quantitative indicators. Its focus is proof that NWR communicates to extraction and develop our extraction and with its main stakeholders and tries to adapt its present and future

Year-on-year increase in CSI1 production activities.’ activities to their opinions.’ Paul Everard, Chairman of the Safety, Health and Sustainability Committee

Highlights NWR Group started non-financial reporting of the impacts of its business using the Global Reporting Initiative (GRI) methodology At EUR 7.88 million, the amount NWR Group spent on corporate social investment1 was the highest since 2008 The total area of reclamation projects completed since 1993 reached 1,678 ha NWR operations LTIFR2 has fallen by 37 per cent over the past 4 years; NWR Group pledged to reduce the rate to 5 in 2015 The average training time per employee has increased by 376 per cent since 2008 to 21.8 hours in 2011

1 NWR’s CSI comprises finances provided for projects in the following areas: community development (OKD Foundation); support for enterprise and job creation, health (OKD Foundation projects); culture (OKD Foundation projects); education (donations to schools, scholarships), environment (finances provided over and above the legal requirement); sport (sponsorship). 2 Lost Time Injury Frequency Rate represents the number of reportable injuries causing at least three days of absence per million hours worked including contractors.

Photo: The winding tower at the Dębieńsko mine. 04 05

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≥ GRI 2.3 ≥ GRI 2.3 ≥ GRI 2.5 ≥ GRI 2.5 Our operations ≥ GRI 2.6

Map of our operations and development projects Zawiercie

Coal reserves1, 2 Mt Coal production (2011) Mt Share of sales (2011)3 per cent Average monthly number of employees4 Hard coal Kędzierzyn-Koźle Zabrze

Coke Gliwice

Development project Katowice Jaworzno

Tychy Racibórz Rybnik 6 Kraków

Opava

Zábřeh 5 Karviná Poland Bielsko-Biała Karviná Mine 89 Mt Karviná Mine 4.1 Mt Karviná Mine 24% Karviná Mine 5,069 Ostrava 1 ČSM Mine 45 Mt ČSM Mine 2.9 Mt ČSM Mine 28% ČSM Mine 4,011 Havířov 3 7 Darkov Mine 37 Mt Darkov Mine 3.2 Mt Darkov Mine 24% Darkov Mine 3,879 Frýdek-Místek 2 Paskov Mine 24 Mt Paskov Mine 1.0 Mt Paskov Mine 10% Paskov Mine 3,267 4 Dębieńsko 190 Mt Dębieńsko 14 Olomouc Frenštát pod Radhoštěm

Czech Republic Čadca

Vyškov Žilina Dolný Kubín

Zlín Povážská Bystrica Slovakia

1 Karviná Mine 2 ČSM Mine 3 Darkov Mine 4 Paskov Mine 5 OKK Koksovny, a.s. 6 Dębieńsko 7 Morcinek Karviná Mine is the biggest ČSM Mine is divided into Darkov Mine is divided into Paskov Mine consists of OKK Koksovny, a.s., has one The chambers’ capacity is Under the Dębieńsko Morcinek is currently hard coal deep-mining two mining sites – mining mining sites – mining site 2 the mining site Staříč, operation: Svoboda Coking approximately 16 tonnes of development project undergoing geological surveys. complex in the Czech site ČSM Sever and mining and mining site 9. květen. The which produces coking coal. Plant. Svoboda Coking Plant coke; the coking cycle takes construction of a new mine The Morcinek development Republic. Both coking and site ČSM Jih. The two extracted raw materials are Also the mothballed Frenštát has four coke-oven batteries approximately 32 to 34 hours. in Czerwionka-Leszczyny project comprises thermal coal are mined at mining sites are connected processed in the mining site mine is a part of the Paskov (nos. 7, 8, 9 and 10) – the total The coking plant’s (former mine) was two sites Morcinek 1 two mining sites – mining underground. All the 2 washing plant. Coking coal Mine. number of chambers is 210 stamp-charged batteries commenced in 2011. and Zebrzydowice 1. site ČSA and mining site extracted raw materials are and thermal coal is mined at (50 + 54 + 50 + 56). mainly produce foundry coke. Extraction is scheduled The only ongoing operation Lazy. processed in the mining site Darkov Mine. to start in 2017. is the extraction of methane ČSM Sever preparation plant. in plant Kaczyce 1 since 3 ČSM Mine produces coking September 2004, which is and thermal coal. owned by NWR KARBONIA.

Coal reserves1 89 Mt Coal reserves1 45 Mt Coal reserves1 37 Mt Coal reserves1 24 Mt Production (2011) 0.8 Mt Coal reserves1, 2 190 Mt Coal reserves1 – Average monthly number Average monthly number Average monthly number Average monthly number Average monthly number Average monthly number Average monthly number of employees (2011) 5,069 of employees (2011) 4,011 of employees (2011) 3,879 of employees (2011) 3,267 of employees (2011) 739 of employees (2011) 14 of employees (2011) –

Hard coal production 2011

4.1 Mt 2.9 Mt 3.2 Mt 1.0 Mt

1 Full name: Joint Ore Reserves Committee. The Group currently uses the JORC system to report reserves and resources. The Group employs a certified geologist who prepares the reserve numbers and is the designated ‘Competent Person’ as defined by the JORC code. 2 Data according to JORC standards as of 1 January 2012 (JORC = Joint Ore Reserves Committee) – this is the methodology for reporting on the state of mineral raw material reserves and resources that is generally used by stock exchanges. 3 Share of coal and coke sales EXW adjusted for coal and coke transport revenues, sales of by-products and other sales. 4 Including contractors. 06 07

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≥ GRI 1.1 ≥ GRI 1.1 Chairman’s statement

Mike Salamon, Executive Chairman of the Board, during a safety visit in Darkov Mine. Sustainable dialogue about the dynamics of coal We need to retain our skilled people, so mining and the challenges that our we look after them. That means providing development lies at the company faces. Through engagement and the necessary training and opportunities heart of our business dialogue we maintain our social licence to for people to grow and develop. And above operate. And this, our first, Sustainability all it means ensuring that our mines are strategy and is key to Report is part of that engagement: it is as safe as possible, because the safety our long-term business a distillation of what we do as a matter of of our workforce is an absolute priority: success. By involving course. good safety equals good business. all our stakeholders in By its very nature, coal mining will always Our biggest investment to date, the have an impact on the environment, EUR 350 million Productivity Optimisation dialogue on future coal and on the people who live nearby. Programme 2010 (‘POP 2010’), directly extraction we maintain That is why we are ever mindful of our improved the safety of our mines because responsibilities as we seek to expand our it reduced the number of longwalls in and strengthen our available coal reserves at our existing operation, and so reduced the number social licence to operate. mines, develop new mines and pursue of our people at risk. The new longwalls merger & acquisition opportunities. we installed underground are robust, Indeed, it is incumbent upon us to go far productive and efficient to operate. beyond ‘box ticking’ compliance; in the The improved microclimatic conditions in course of our business we must maintain longwalls are an important contribution a working dialogue with the Czech, to improved occupational health and Polish and European Union regulators of safety. As this went hand in hand with our industry, with the local politicians efficiency and the ability to safely mine who represent the towns and regions deeper, this meant that the jobs within where we operate, and with the national NWR became much more sustainable. politicians who legislate. Mining will always be a hazardous Knowledge and understanding is key business, and hence requires continuous to a healthy and constructive dialogue, awareness, thought and innovation from and to that end we place great emphasis each employee in order to minimize Coal has been an important source of on explanation and education. We the potential consequences of these » Further improvement of work safety in our operations energy and a vital industrial raw material need to help people understand that hazards. Thus in NWR we have made » Continuing investment in the renewal and modernisation of protective for hundreds of years, and it will remain coal is important and that coal mining occupational health and safety a central so for many decades to come. The can be economically, environmentally focus. We engage our employees through work gear and clothing importance of this for the region where and socially sustainable. This can be the Continuous Improvement Programme » Completed reclamation work covering more than 100 hectares NWR operates cannot be underestimated: a challenge in today’s world of 10-second (‘CIP’). In 2011 this generated more than the economy of the Upper Silesian Coal sound bites, so it is essential that we 670 innovative ideas and suggestions » Strengthening cooperation with schools Basin that straddles the Czech Republic openly communicate, ensure that our from the workforce, which have » Stepping up communication regarding new extraction areas and Poland is heavily reliant on coal voice is heard, and diligently foster contributed both to safety improvements mining and coke production. We currently stakeholder relations. and cost savings of approximately » Final approval for Dębieńsko followed by groundbreaking are further steps employ more than 18,000 people, and EUR 14 million. to create hundreds of new jobs and opportunities for closer cooperation the livelihoods of many more thousands To sustain our business we need to of people depend on the viability of nurture future generations of miners and We have also invested in the renewal with the local community our mining operations. It is therefore attract bright and well-qualified people to and upgrading of personal protective essential that we focus on the long-term the company. That is why NWR cooperates equipment and clothing for every sustainability of our business. closely with schools, with the mining one of our miners, who are now and engineering faculties of Ostrava among the world’s best equipped. Sustainable development is at the and Pardubice universities, and why we Training and discipline are also hugely heart of our business strategy and is have revived apprenticeship schemes. important safety factors: good practice the key to our long-term commercial And we are now looking to replicate accompanied by disciplined application success. We seek to engage all our these activities in Poland, where we have is vital for reducing human error. It is stakeholders – employees, regulators embarked on the development of a new encouraging to report that, thanks to our and local communities, in an ongoing mine at Dębieńsko. investments and our disciplined safety 08 09

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≥ GRI 1.1 ≥ GRI 1.1 Chairman’s statement

At NWR’s coke subsidiary, OKK, we successfully implemented the Coking Optimisation Programme 2010 (‘COP 2010’), which saw the closing and clean-up of the Šverma plant and the construction of a new coking battery at our Svoboda Coking Plant and the installation of a new charging and exhaust system that complies with the strictest environmental requirements. Between now and 2013 we plan to refurbish Svoboda Coking Plant Mike Salamon was appointed a Director quenching towers, which will further and Executive Chairman of NWR with reduce air pollution. effect from 8 April 2011. Mr. Salamon has served as a director and executive Community engagement is a long-term chairman of the board of directors process with few immediate results, but of NWR NV since 1 September 2007 we are making good progress. Where once and continues to hold these positions our Czech mining subsidiary OKD was seen following the reincorporation of NWR locally as omnipresent and all-powerful, NV in the UK. Mr. Salamon also serves stakeholders now acknowledge our as a non-executive member of the openness and are increasingly engaged board of directors of OKD, Central Rand and involved with what we do. In 2012 we Gold, Gem Diamonds, Ferrexpo Plc shall be developing our communications and Minera Las Cenizas. From 2007 till and building dialogue in Staré Město January 2012 he was also co-president u Karviné and Orlová-Výhoda in the Czech of AMCI Capital. He has extensive Republic, where new mining operations are knowledge of the international mining planned. At our Dębieńsko development and extractive industries. His career in Poland we have had a healthy dialogue spans more than 30 years, 21 years of with the local authorities and communities which was spent with BHP Billiton, the View over the reclaimed area on the mining site Lazy of Karviná Mine. from the outset, and in 2012 we shall world’s largest diversified resources continue this work and embed sustainable company. regime, we have nearly halved our NWR Despite this, the tragic loss of five Together with local and national business practices. And as we seek to operations1 LTIFR rate from 12.07 in employees at our mining operations authorities, NWR invests in ongoing land explore the Frenštát pod Radoštěm coal 2008 to 7.64 in 2011. For 2012 we want to during 2011 reminds us of the severity of reclamation projects. The objective is to deposit in the Czech Republic, dialogue involve all employees in the continuous the hazards stemming from our geological return landscapes affected by mining and engagement will play a crucial role. improvement process in order to reduce and mining environment, and hence we to their natural condition. Since 1993, NWR operations LTIFR to 5 by the end of continue to place a strong focus on ways reclamation projects were completed The Board of NWR is committed to the 2015. to limit the human impact of these. on more than 1,600 hectares of land long-term sustainable development of affected by mining. In 2011, NWR the business. We depend on our social NWR mines at depths of up to 1,100 metres A key challenge for NWR is the impact finished reclamation projects covering licence to operate, and have a duty of in some of the world’s most challenging of mining on the environment; people 111.4 hectares. This is long-term, patient care towards our employees and to those geological environments. We continuously can see it, and feel it. We seek to meet and, ultimately, rewarding work: we take who live near our mines. The tonnage work on how best we can predict earth this challenge by carefully planning our great pride in restoring the landscape, that we produce and our cost structures tremors and rock bounces, and have coal mining and coke production and re-establishing flora and fauna, and are directly related to the quality of established a panel of international by running comprehensive monitoring providing leisure and recreational parks our operations, which is in turn related experts to look at predictive technologies and waste management programmes on once scarred landscapes. In 2012 we to sustainability. We need to be able and methods that could help to mitigate during the extraction and production will continue our reclamations activities to manage and direct our progress in geological risk. processes. We continuously invest in in line with our five-year Comprehensive ensuring the long-term sustainability of environmentally friendly and energy Rehabilitation and Reclamation Plan our business, and to do that we need to efficient technologies. And we pay great (‘CRRP’). measure our efforts. That is why we have 1 NWR operations comprise companies prepared this Sustainability Report, to performing ongoing coal extraction attention to the regeneration of areas and coke production in 2011, i.e. OKD affected by our mining. help measure what we do and to track our (including OKD HBZS, a.s.) and OKK. progress. 10 11

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Petra Mašínová, Head of Corporate Communications and Sustainability, during the festival ‘Mining Festivities’ in Karviná. We have to be open We benchmark ourselves against the and planning sessions on sustainability big global mining companies listed on reporting with senior management at and transparent about the London Stock Exchange, and the big OKD, OKK and NWR KARBONIA. Then came our business, and this miners publish sustainability reports in the practical step of explaining to our accordance with GRI (Global Reporting colleagues that this is something for their Sustainability Report is Initiative) reporting framework, which benefit, that it is an extension of what part of that. is independent and is open to audit by they already do, and that by collecting third parties. Adopting GRI guidelines was and documenting data they will be able to therefore a natural decision. follow their own development in certain areas, such as waste-water management, Regarding investors, our Investor Relations pollution monitoring, improving safety, team have said that they are often asked if and so on. I think also that this has NWR reports on sustainability. During US helped them to really understand that investor road shows some investors, such sustainability is not separate from our as specialist funds, look at several mining business strategy and activities; it’s companies and ask ‘why should I buy you?’ a process that runs throughout the whole Reporting sustainability data was one of company and is something that we all live the criteria they looked for and trusted. every day.

What is also important is that hardly Q: Do people now accept the new reporting any mining companies are reporting in routine? the Czech Republic or Poland. In the Czech Republic there is currently one Tomáš Rak (TR): People accept it because other mining company that reports they understand the usefulness of having on sustainability for, I think, exactly the data in one published Report. It is the same reason as Mike describes: also important to note that the decision a licence to operate. No Polish coal mining taken within NWR was then discussed company or coke producer is currently and endorsed by senior management in reporting according to GRI, so we have an our subsidiaries. Also safety is something opportunity to take a leadership position everyone within the Company naturally Q: What was the most important reason in our industry and to set best practice aligns on – we all want to get home after » The NWR sustainability executives discuss the introduction of for NWR to begin sustainability reporting? standards for sustainability reporting. work in the same condition as we left for sustainability reporting in NWR Group work earlier that day! Petra Mašínová (PM): There are a number Q: This is your first report according to » Sustainability is a process that runs throughout the whole Company of reasons for reporting our sustainable GRI Sustainability Reporting Guidelines. PM: We are lucky that, as in most mining and is something that we all work on every day business practices, each of which is What had to be done within NWR to companies, safety and responsibility important in its own right, but by the far ensure regular and compliant reporting create a disciplined system and chain » The Report’s priorities were chosen after talking with our stakeholders the most important, as our Chairman practices? of command, it’s a little like army » An open and ongoing dialogue between the company and its stakeholders of the Board, Mike Salamon, says in his discipline, so people are used to reporting. introduction, is our need to maintain PM: In our first CSR document, called A disciplined and regular reporting routine is essential a social licence to operate. We need to ‘6 steps towards corporate social helps to ensure that people prepare data » The Report content is based on the audited financial information document and report what we are doing as responsibility’ and published in 2010, and information in good time for the next part of our engagement with stakeholders, we said that in 2011 we would conduct Sustainability Report. summarised in NWR’s Annual Report and Accounts 2011 it helps them to understand our efforts a proper stakeholder analysis, improve our and the non-financial data was gathered from the subsidiary companies to make the business sustainable and it data collection processes, set objectives Q: Why did you choose GRI reporting supports our dialogue with them. for future years and prioritise our methodology? » We have modified our Scorecard and precise targets for 2012 sustainability agenda. » Through KPIs we can move toward a better performance We are also a public company, listed PM: It’s one of the most common and on the London, Prague and Warsaw Last year our Board of Directors widely accepted methods and, importantly, stock exchanges and accountable to established the Safety, Health And there is a GRI Mining and Metals Sector shareholders and to market regulators. We Sustainability Committee (see page 22) Supplement. Sometimes it is difficult to have to be open and transparent about our which confirmed our effort from the measure and compare sustainability in business, and this Report is part of that. top level and we then held discussions heavy industry and the services industry; 12 13

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Sustainability executives Q&A

Communities close to our mining transparency and openness. We are one of Q: What would you recommend for other operations and our employees are very the first companies in Central Europe, and companies in Central Europe? important stakeholders. Then there are certainly the only Polish hard coal miner, the industry regulators, local authorities, to introduce sustainability reporting PM: I would recommend that companies ministries, customers, suppliers, local principles and we are pioneering the study the concept of sustainability schools and universities, and, of course, adoption of GRI reporting methods in the reporting and consider if it is right for our shareholders. They all took an Czech Republic, and we’d like to maintain them. Those companies that decide to active part in forming this Report, and a leadership position in this field. start publicly reporting should then look we continue the dialogue with them. In at measurement methods, such as GRI, order to reach all of our stakeholders we Q: What was the reason for modification and then adopt a set of KPI targets so decided to publish the Report in three of targets in comparison with 2011? that they can measure progress. It’s an Petra Mašínová is the Head of Corporate languages: Czech, English and Polish. initiative that enhances transparency Communications and Sustainability TR: In our first CSR document, we had across all areas of a business. It’s not of NWR and the Chief PR and Q: What was the most difficult issue some simple KPIs (Key Performance just about putting sustainable business Communication Officer of OKD. She regarding community engagement? Indicators), but stakeholders were asking practices into effect, it’s about reporting, graduated from the University of West for specific targets, for example in safety, measuring performance, and sharing that Bohemia. After finishing postgraduate TR: Explaining sustainability reporting energy consumption, emissions, staff with stakeholders. It is a very positive study of EU&Communication in Brussels and communication with people in the turnover, and so on. So this year we have communication channel, and it shows that she completed the Tuck Executive communities and with our employees modified our Scorecard (see pages 14–15) we are not afraid to set targets and report Program at the Tuck School of Business was, and still is, a challenge. They are and we have adopted, where possible, on our performance. in USA. Before joining NWR she worked Darkovské moře (‘Darkov Sea’), one of the most interesting OKD reclamation projects. In the background influenced by their historical experience precise targets for 2012. We have certainly as EU Funds Director at Erste Bank and is the Darkov Mine. from the Communist era. Back then there added more KPIs. This should enable TR: Furthermore we would like to generate as Director of EU Department at the sustainability in a bank would be totally of which are not too surprising, but were more than 100,000 employees and better benchmarking for our stakeholders. interest in proper sustainability reporting Office of the Government of the Czech different to sustainability for a coal mining some of the other findings were. For the company was so powerful that it didn’t Through KPIs we can slowly move toward among companies, especially in the Republic. She has started her career company. example, some respondents mentioned feel the need to account for its activities. a better performance. Czech Republic and Poland, and to start at the Ministry of Foreign Affairs and waste management; ministries and That was a different era, of course. a discussion on the subject. worked as a Spokesperson of the Czech Q: What NWR activities does the Report authorities cited energy consumption; Q: What is your future sustainability Permanent Representation to the EU. focus on? and from the community came a focus Nowadays an open and ongoing outlook for Polish projects? Petra Mašínová is the Chairwoman of the on safety, transport, jobs and market dialogue between the Company and its OKD Foundation Board, and a member of PM: We chose the Report’s priorities presence – they really want OKD to be in stakeholders is essential. It has been PM: At Dębieńsko NWR will bring the Charter 77 Foundation Board. after talking with our stakeholders: local the region, they don’t want our presence quite difficult to explain what we are doing employment and create a major new communities, our investors, the regulatory reduced because that would mean fewer and why, and what sustainability reporting business by reopening the mine. Opening authorities, our employees and others. jobs. Regarding OKK, people mentioned means. This is the first time that people a new mine in Europe is a rare thing In the Report we focus on the operations emissions as a main focus for them. were asked so directly for their opinions, nowadays. It’s a unique opportunity and impacts of our core business, coal were asked what they think about the for NWR KARBONIA to set a good mining, and coke production. At our OKK The data in the Report are based on the Company. This is the kind of dialogue that sustainability benchmark for Polish coke subsidiary there is more focus on audited financial information summarised we want to foster, improve and strengthen. mining companies, and to show people air pollution monitoring, while at OKD in NWR Annual Report and Accounts in Poland that there is an open and it’s more of a safety focus. With NWR 2011 and the non-financial data was Q: In which areas of sustainability do you interactive way for mining companies KARBONIA in Poland we are already gathered from the subsidiary companies, think NWR is a leader? to work with local communities. We planning to invest in the community to OKD, OKK, NWR KARBONIA and our mine can also invest in the right type and support local secondary schools. rescue service, OKD HBZS, a.s. Most of PM: NWR is the only hard coal mining levels of education for supporting our Tomáš Rak is the Sustainability the environmental data in this Report are company in the Czech Republic and business, such as engineering. We have Manager at NWR Group. He graduated in The range of activities covered in the also reported to the various responsible it is also Europe’s largest producer of the opportunity to show that we can have macroeconomic policy and international Report was driven by our stakeholders. We authorities in the Czech Republic and foundry coke. We certainly strive to be an open employment policy, and that we trade from the University of Economics are in continuous contact with ministries, Poland. a leader in safety, and when it comes to can support activities for the children in Prague in 2001. During his work in municipalities, NGOs and so on, to identify philanthropy the OKD Foundation is the and families of our employees. And the Czech Trade Promotion Agency priority areas, and to put together a scale Q: How do you identify your key largest private corporate foundation in from the very beginning, from the initial (CzechTrade) he was head of the of indicators. stakeholders? the Czech Republic. Due to our listing drilling of boreholes, we shall be working Key Account Department. In 2003 on three stock exchanges we have to be responsibly to manage the environment. he established a CzechTrade office TR: For the majority of stakeholders the TR: We identify stakeholders who transparent and open, and I think the fact in Stockholm where he stayed as most important indicator was safety, influence NWR and, on the other hand, that we have decided to publish annual a director for 6 years. and then came sustaining jobs, both which are influenced by NWR activities. Sustainability Reports enhances our 14 15

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≥ GRI 1.2 ≥ GRI 1.2 Scorecard

Priority area Indicator GRI Target 2011 Performance 2011 Comments 2011 Target 2012 For further reference

Safety Fatalities LA7 No fatalities 5 No fatalities Pages 47–48

Lost time injury frequency rate (LTIFR)1 (OKD) LA7 7 7.82 –6 Pages 46–47

Lost time injury frequency rate (LTIFR)2 LA7 – 7.64 5 in 20157 Pages 46–47

Employees Voluntary employee turnover3 LA2 1.17 Voluntary employee turnover does not Page 43 exceed 1.20 per cent

Training and education Average hours of training per year per employee LA10 – 21.83 hours – Not less then 20 hours per employee Page 53 per year

Energy Electricity consumption (OKD) EN3 671,092 MWh –8 Pages 70–72

Emissions Compliance with NOx emissions limit in tonnes EN20 – – – Monitored but not targeted 280 tonnes Page 66 in 2011

Compliance with SO2 emissions limit in tonnes EN20 – – – Monitored but not targeted 77 tonnes Page 66 in 2011

Compliance with the particulate matter (‘PM’) emissions limit EN20 – – – Monitored but not targeted 110 tonnes Page 66 in tonnes4 in 2011

Water Compliance with the limit for total water discharge EN21 – – – Monitored but not targeted 21,669 m3 Page 75 in thousands of m3 in 2011

Percentage share of recycled and reused water EN10 – – – Monitored but not targeted 50 per cent Page 75 in 2011

Biodiversity (reclamations) Area of completed reclamation in ha (as per CRRP5) MM1 – – – Monitored but not targeted 28.4 ha Page 57 in 2011

Mining damages Rock bounces and damage to people’s property SO1 – – – Qualitative target Improving communication when dealing Page 97 with rock bounces and damages to people’s property

Procurement Supplier quality audit MM11 – – – Neither monitored nor At least 20 supplier audits Page 101 PR3 targeted in 2011 Achieve a result of => 90 points

Locally based suppliers EC6 – – – Neither monitored nor At least 80 per cent of NWR KARBONIA Pages 100–101 targeted in 2011 suppliers9 come from Poland

1 Lost Time Injury Frequency Rate represents the number of reportable injuries causing at least three days of absence in NWR Group per million hours worked including contractors. For 2010 this indicator was only reported for OKD (not including HBZS mine rescue service). For the sake of completeness we give the same indicator for 2011. 2 Since 2011 the key indicator LTIFR has been aggregated for OKD (including HBZS mine rescue service) and OKK. 3 The voluntary employee turnover is the employee turnover rate minus forced departures (organisational change), retirements and departures for health 6 From 2012 LTIFR will be reported and targeted at NWR operations level. reasons. 7 This is a long-term target. 4 Emissions limits over and above the limits set by the Czech legislation apply solely to major sources of air pollution. In the case of NWR Group this 8 Electricity consumption is generally dependent on the volume of extraction, investments etc. Setting targets for the coming period is therefore not involves the subsidiary OKK, which is registered as a major source of air pollution. a suitable benchmark. 5 Comprehensive Plan for Rehabilitation and Reclamation, drawn up for a five-year period and updated annually, see page 57. 9 The rest of 20 per cent will be mostly international companies with branches in Poland. 16 17

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 3.1 ≥ GRI 3.4 ≥ GRI 3.2 ≥ GRI 3.5 ≥ GRI 3.3 ≥ GRI 3.6 ≥ GRI 3.5 ≥ GRI 3.7 ≥ GRI 3.6 ≥ GRI 3.8 About this Report ≥ GRI 3.7 ≥ GRI 3.9 ≥ GRI 3.8 ≥ GRI 3.10 ≥ GRI 3.9 ≥ GRI 3.10 ≥ GRI 3.11

This Report sets out the different fields of business and differing the surface in December 2011. Opening impacts on their surroundings. The Report the Dębieńsko mine and putting it into economic, environmental covers operations in the Czech Republic, operation will require a total investment and social impacts and i.e. the activities of OKD, including its of EUR 411 million up to the start of subsidiary OKD HBZS, a.s. (‘HBZS’), and production in 2017. benefits of NWR Group OKK, and in Poland, i.e. NWR KARBONIA, activities for the and describes their activities’ impact The Report’s boundaries and limits on stakeholders and the environments are determined by the fact that NWR calendar year 2011. It is affected by operations. Group performs its principal activities a strategic document – production and sale of hard coal, NWR was incorporated in the United production and sale of coke – itself. complementing Kingdom in 2011 as the parent company The Report’s data on the conditions of and adding to the NWR of the Group and as a successor contractors working in the mines2 (4,532 to NWR NV which still performs as of 31 December 2011) are as complete Annual Report and operational management of the Group. as the data on our employees. Other Accounts for 2011 and NWR NV employs a total of 19 people outsourcing is insignificant. The existing is intended mainly for (as at 31 December 2011); its work reporting covers the entire output of NWR principally comprises financial, legal Group and also environmental and social 1 our key stakeholders . and consolidation services. NWR impacts. Communications, s.r.o., is a company founded on 6 July 2011. At year end 2011 Reported data it had 5 employees. NWR Communications, The reported economic data are Surface operations are for coal mining as important as those underground. s.r.o., takes care of NWR’s corporate consolidated at the NWR level. The Report communication and sustainability only contains summarised economic This is the second NWR CSR document, reporting, including the compilation and data – detailed economic and financial responsibility. In 2011 the key indicators is designed to provide a complete and » GRI recommendations but the first Report drawn up using the publication of the NWR Sustainability information is contained in the NWR Annual were revised and supplemented. For the balanced view of NWR’s activities and their » Comments from the GRI application GRI G3 Sustainability Reporting Guidelines Report. Report and Accounts 2011. first time, NWR defined specific targets to positive and negative impacts. level check (2006), including the Mining and Metals be achieved in the coming year. In the case Supplement at application level A. The For the purposes of the Report and Environmental and social indicators are of some indicators there has been a change The following sources were taken into Report methodology first NWR CSR document entitled ‘6 steps individual indicators the key entities are always reported for each subsidiary in reporting that more comprehensively consideration when determining the The Report follows the GRI methodology towards corporate social responsibility’ OKD and OKK, which account for the vast (OKD, OKK, NWR KARBONIA), as nterpreting reflects the indicator’s development over Report’s content: (GRI Sustainability Reporting Guidelines was drawn up for the calendar year 2010. majority of production activities and 96 per impacts in these areas requires a local time and respects the differences between Version 3.0, 2006, including Mining and For selected key indicators data covering cent of the workforce. context, as indicated by the involvement the subsidiaries (e.g. coal extraction and » NWR Group’s strategy Metals Supplement, 2010) and includes an the period 2008–2011 are used. NWR of stakeholders. coke production). In some cases a given » NWR’s and its subsidiaries’ policies, assessment of the risks of our business guarantees that the methodology for Relations between OKD and OKK – indicator only applies to one subsidiary internal regulations and reports activities. collecting and calculating the indicators especially commercial relations – are The reported data cover all on-going (e.g. total quantity of waste rock). » The Group’s risk analysis contained in this Report has not changed governed by the Controlling Agreement. operations linked to NWR’s business. » Feedback from stakeholders The Report gives a full overview of our during these years. In environmental, social, personnel, NWR’s development activities in Poland The Scorecard only comprises indicators (materiality) compliance with the content as per the marketing and ethical matters OKK follows and the planned exploration in the Frenštát for which it is technically possible to set » Media monitoring GRI standard and is drawn up in line with Starting in 2011, the NWR sustainability decisions and policies issued by OKD as pod Radhoštěm locality (Czech Republic) a future target and in which the NWR Group » Benchmarking analysis of sustainability application level A. See the GRI Content reports are to be published once a year. the Controlling Entity (e.g. Code of Ethics, are not included in the on-going operations. is striving for long-term improvement. reports in the field of coal extraction Index on pages 108–116. environmental policy etc.). A full summary of all the Group’s key » GRI G3 guidelines including the Mining Scope of the Report The quantitative indicator values are indicators is given in the individual & Metals Supplement GRI checked this Report’s compliance with The Report focuses on the economic, NWR KARBONIA is an NWR development calculated from NWR subsidiaries’ chapters of this Report and in the closing » Information from an external Level-A GRI reporting principles in May environmental and social impacts and project comprising the Dębieńsko and monitoring data, based on the rules laid appendices on pages 103–105. consultancy firm 2012. benefits of NWR Group activities. The Morcinek localities in Poland. No mining down by the national legislation and the (www.smart-report.cz) environmental and social data are derived operations took place in these localities relevant sector standards of the Czech Content of the Report » Information from associations, For enquiries regarding the Report and from the NWR subsidiaries, in view of their in 2011, and this Report only contains Republic and Poland. When defining the content of the Report we initiatives and NGO’s: reported data please contact: data and information that were available emphasise the economic, environmental > Czech Donors Forum 1 See Chapter Relations and Communication with for 2011 and are relevant to the Report. Scorecard and social areas, aspects and indicators > Business for Society Tomáš Rak, CSR Manager Stakeholders, pages 30–33. NWR KARBONIA began developing the In ‘6 steps towards corporate social which were deemed significant by NWR’s (www.byznysprospolecnost.cz) Phone: +420 225 282 498 2 See a list of suppliers operating in OKD mines > in the chapter Relations and Communication Dębieńsko mine at Czerwionka-Leszczyny responsibility 2010’ NWR set out its key stakeholders or which NWR considers PONTIS foundation E-mail: [email protected] with Stakeholders on page 32. and repairing the old mining buildings on objectives in the various aspects of social necessary in terms of context. The Report (www.nadaciapontis.sk) New World Resources Sustainability Report 2011

NWR Group is fully aware of the significance of Continuous dialogue plays a major role in defining Our approach communicating with its stakeholders. The way the priority areas our stakeholders regard as crucial. the Group and its stakeholders influence each In these areas the Company sets out key indicators other is very important for the Group. that help monitor and influence developments.

Number of sustainability priority areas

Highlights Reincorporation of New World Resources Plc in Great Britain Health, Safety and Environment Committee transformed into the Health, Safety and Sustainability Committee 10 NWR Group sustainability principles were defined NWR approved the Business Integrity Rules, which have been implemented by all subsidiaries OKD came second in the Workplace of the Future category of the prestigious TOP Responsible Firm 2011 competition (Czech Republic)

Photo: New personal lamp T 1005.1 bought for our employees under the SAFETY 2010 programme. 20 21

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 1.2 ≥ GRI 1.2 Sustainability strategy

Sustainable development is integral to 2. Recruiting and retaining skilled 7. Investment in technology The programme focuses on five key areas: In 2010, our Czech coke production Both OKD and OKK have in place the the business strategy of NWR. Ensuring employees Continuous investment in modern subsidiary OKK successfully completed Continuous Improvement Programme that our business is economically and Highly skilled employees are key to our technology enables us to mitigate » People the Coking Plant Optimisation Programme (‘CIP’), which was launched in 2009. This environmentally sustainable enables business. We strive to ensure that our geological complexities, to reach » Efficiency 2010 (‘COP 2010’), which modernised programme is designed to motivate our the NWR Group to maintain its social employees are motivated, regularly production targets and to improve » Reserves and consolidated our operations into employees to submit efficiency and safety- licence to mine coal and produce trained and able to develop their skills and the occupational health and safety » Safety a single coking plant facility, Svoboda improvement ideas and other suggestions coke. We therefore continuously knowledge within our operations. environment for our mining employees. » Predictability Coking Plant. The new coking battery no. while simultaneously strengthening monitor and evaluate the impact of our 10 was built to satisfy the most stringent our employees’ sense of belonging and activities in order to effectively manage 3. Maintaining dialogue and strengthening 8. Cost management environmental limits, and coking battery engagement within the NWR Group the sustainability of our business. our partnership with stakeholders The use of the latest mining technology no. 8 underwent a complete overhaul. and their engagement in its activities. We value our key stakeholders and has allowed us to effectively manage our The long-term success of the NWR Group look to strengthen our dialogue with costs and productivity. depends on maintaining a broad social them. We cooperate with regulatory licence to operate. We target: authorities, and through membership in 9. Maintaining a strong financial position BEING A RESPONSIBLE PARTNER industrial associations, we contribute to The strong financial position of our » the sustainable and responsible use the debate on the legislation affecting company is essential for the sustainable of natural resources that we mine our industry. We strive to maintain and development of our business. It rewards and process; further improve our relationships with the our shareholders, enhances our SAFEGUARDING THE SUSTAINABILITY OF OUR BUSINESS » minimising the environmental impact local communities in the regions where attractiveness to potential investors, of our coal and coke production by we operate, creating a strong base for enables us to pursue investment and thorough planning and efficient mutually beneficial long-term dialogue. growth plans, and allows us to contribute SECURING AND SUSTAINING SOCIAL CONSENT FOR EXTRACTION execution and by responsibly managing better to the communities in which we the landscape; and 4. Monitor the impact of the NWR Group’s operate. » sustaining jobs within and bringing activities on the environment PRINCIPLES wider benefits to the local communities Maintaining strict internal policies 10. Growth through M&A and ensuring that these efforts go enables us to better manage the negative We continue to believe in the long-term » Maintaining dialogue » Continuous improvements » Monitor the impact of the » Cost management beyond our legal obligations. impacts on the environment. Continuous rationale for consolidation with the CEE and strengthening in occupational health Groups’ activities on the » Sustaining our business stakeholder dialogue ensures that all coal sector. Our strong financial position our partnership with and safety environment through developing By openly communicating our activities our environmental activities are in line gives us the flexibility necessary to move stakeholders » Recruiting and retaining » Investment in technology existing coal reserves and aspirations, NWR Group seeks to be with the stakeholder requirements quickly when consolidation and M&A skilled employees » Maintaining strong an engaging and reliable partner for all (municipalities, local communities and opportunities arise, whilst maintaining » Growth of our company financial performance stakeholders. state and municipal authorities). a disciplined approach to acquisition through M&A strategy. NWR Group’s principles of sustainable 5. Sustainability reporting development Measuring the impact of our activities NWR’s sustainable development strategy PILLARS and setting targets enables us to manage is implemented by all Group subsidiaries. Priority principles our operations responsibly and to CORPORATE GOVERNANCE OUR PEOPLE ENVIRONMENT COMMUNITY 1. Continuous improvements in continuously strive for improvements. Key strategic initiatives occupational health and safety We use GRI reporting processes to help us Our Czech coal mining subsidiary OKD 1 Safety is our top priority – NWR operates measure the quality of our reporting and runs the PERSPective 2015 Programme PRIORITY AREAS – GRI ASPECTS in some of the most demanding geological our dialogue with all stakeholders. (‘PERSP 2015’)1, which follows on from » Relations between » Health and safety » Biodiversity » Community (e.g., conditions in the world, and deep the successful Productivity Optimisation workforce and » Employment » Emissions, wastewater, community impact underground mining is inherently risky. Business principles Programme 2010 (‘POP 2010’). The PERSP management » Economic results waste management) We have achieved significant 6. Sustaining our business through 2015 initative aims to strengthen NWR’s » Corruption » Market presence » Energy » Market presence improvements in our mining LTIFR and developing existing coal reserves competitive advantages by maximising the » Economic results continue to remain committed to further We strive to access further coal reserves return on our investments in sophisticated improving on our strong track record. in our existing mines in order to extend the technology, safety and health protection. operating life of our mines.

1 More information available at SUSTAINABILITY REPORTING http://www.newworldresources.eu/en/operations/ active-mines/optimisationprogramme 1 Priority areas are topics that touch on the interests of specific stakeholders and are covered in detail on page 25. 22 23

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 4.1 ≥ GRI 4.2 ≥ GRI 4.4 ≥ GRI 4.3 ≥ GRI 4.8 ≥ GRI 4.4 ≥ GRI 4.9 ≥ GRI 4.5 ≥ GRI DMA LA ≥ GRI 4.6 Sustainable development Occupational health ≥ GRI 4.9 and safety governance

As a company founded in England its decisions on economic, environmental Board of Directors and Senior Management NWR and Wales whose shares are listed and social issues have a direct influence Board of Directors Name NWR Board of Directors NWR Senior Management on the London, Prague and Warsaw on Group policies. stock exchanges, NWR has in place Mike Salamon Executive Chairman Executive Chairman an appropriate system of corporate One of the principles applied by NWR is Klaus-Dieter Beck Executive Director of NWR Executive Director Audit and Risk governance. The Board of Directors that its subsidiaries co-opt the policies Marek Jelínek Executive Director Executive Director and Chief Financial Officer Management adopted a Corporate Governance Policy1 adopted by NWR; if a policy is adopted Ján Fabián – Chief Operating Officer Committee largely based on the UK Corporate at the level of NWR, it is adopted by the Governance Code 2010, which also entire Group. Subsidiaries incorporate Zdeněk Bakala Vice-Chairman and Non-Independent Non-Executive Director – Remuneration conforms to the basic principles of the these policies into their internal Peter Kadas Vice-Chairman and Non-Independent Non-Executive Director – equivalent legislation in the Netherlands, regulations, reflecting the local legal Committee Hans Jürgen Mende Non-Independent Non-Executive Director – the Czech Republic and Poland. environment. The principle is mentioned in the introduction to every adopted Pavel Telička Non-Independent Non-Executive Director – Unlike the two-tier system common regulation. The principle also applies Kostyantin Zhevago Non-Independent Non-Executive Director – Finance and Investment in continental Europe with a board of to the qualification and professional Bessel Kok Senior Independent Director – Committee directors and a supervisory board, NWR requirements policy (‘Corporate Steven Schuit Independent Director – has a single-tier governance system, Governance Policy’) for members of the whereby the Board of Directors exercises Board of Directors4 of the subsidiaries, Paul Everard Independent Director – Safety, Health both executive and control powers. whereby Section 6 is followed. Barry Rourke Independent Director – and Sustainability The Board of Directors is composed of Committee Hans-Jörg Rudloff Independent Director – Executive and Non-Executive Directors Relations between management and and is headed by a Chairman. As of 31 the employees and shareholders5 NB: The current composition can be found at http://www.newworldresources.eu/en/corporate-governance/board-management/senior-management Real Estate December 2011 the Board of Directors The conduct of NWR management and The composition of the Board, CVs of Board members and Board meetings are available in NWR Annual Reports and Accounts 2011 pages 62–72. Committee had 13 members, three of whom were employees is governed by the NWR Code Executive Directors, five were Non- of Ethics and by the subsidiaries’ internal Independent Non-Executive Directors and regulations. The Code of Ethics includes Nomination five were Independent2 Non-Executive a procedure for reporting improper Commitee Directors. The Independent Non-Executive practices (‘whistleblower procedure’)6 Directors take part in developing NWR’s that makes it possible for employees to The Trade Unions are also represented on Board meetings; there were eight meetings strategy and check the work of the communicate their concerns regarding the OKD Internal Audit Committee and – in 2011. Risks are monitored and assessed Executive Directors and the Group’s actions by NWR, its representatives and by law – on the OKD Supervisory Board. by the Audit and Risk Management management3. employees directly to the Board, the The work of Trade Unions is reflected Committee, which also makes appropriate independent member of in the Collective Agreements and their recommendations of suitable measures to To make the exercise of powers more the Board and the designated Company annexes. The OKD Collective Agreement the Board. As NWR pays close attention to effective the Board of Directors has set representative responsible for matters of for 2010 to 2012 is currently in effect. safety, health and environment risks, it put 1 The full wording of the NWR Corporate Governance Policy can be found at up six committees to deal with certain key ethics. these risks on the agenda of the Safety, http://www.newworldresources.eu/en/ areas. Confidential complaint boxes have Health and Sustainability Committee. corporate-governance/policies NWR’s shareholders provide been established for complaints and For more information on the identified 2 The NWR Board of Directors determines a given Director’s independence in The Safety, Health and Sustainability recommendations and directions notifications related to the OKD and OKK risks and adopted measures see page 34. accordance with criteria contained in the Committee (‘the Committee’) regarding the economic, environmental Codes of Ethics; these are located in the Corporate Governance Policy, Section 6.4 The Committee was formed out of the and social performance of the Group reception area of the OKD head office The compensation manual records the (see http://www.newworldresources.eu/en/ previous Health, Safety and Environment through NWR’s highest governance body. corporate-governance/policies). and the reception areas of the individual remuneration policy of the Company, 3 The organisational structure of the subsidiaries Committee. The Committee’s function is Mines. Suggestions can be delivered outlines principles regarding remuneration is shown in the appendices on pages 106–107. to provide information support for Board Employees of the subsidiaries make their in writting via the complaint boxes, in senior and key positions within the 4 The composition of the subsidiaries’ boards of decisions on matters concerning social recommendations through the Trade in electronic form, by telephone or by NWR Group and provides the framework directors and supervisory bodies can be found in the appendix on pages 106–107. responsibility, with particular emphasis Unions (there are three Trade Unions in letter to the addresses specified in the for the Board and the Remuneration 5 A description of relations with shareholders is on Group safety, health and environmental OKD; one in OKK and one in HBZS; see Codes of Ethics7 (usually the Company Committee in this area. The remuneration 7 given in the NWR Annual Report and Accounts risks. The Committee also monitors page 45) and the unions’ participation Secretary, Chief Security Manager or legal policy8 was adopted by the Board on The subsidiaries’ Codes of Ethics are published 2011, page 81. on the following web sites: http://www.okd.cz/ 6 Further information on the whistleblower compliance with national legislation in on commissions, most notably the department). 8 April 2011 with effect from 6 May 2011. en/about-us/company-profile/code-of-ethics/ procedure can be found in the NWR the area where we operate, and monitors Compensation and Transfer Commission NWR’s remuneration policy in 2011 takes and http://www.koksovny.cz/en/about-us/ Code of Ethics and Business Conduct (in and draws attention to global trends in and in the Health and Safety Committee in Performance and remuneration policy into account the attainment of financial company-profile/eticky-kodex-2011 English), Annex: Whistleblower Procedure, 8 Further information about remuneration http://www.newworldresources.eu/en/ sustainable development. The Committee OKD, where employees fulfil the function The Group’s economic, environmental and and non-financial targets, including policy is given in the NWR Annual Report and corporate-governance/policies was established at the level of NWR, but of works health and safety inspectors. social performance is assessed at regular sustainable development. Accounts 2011, page 94. 24 25

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 4.9 ≥ GRI 1.2 ≥ GRI 4.17 ≥ GRI SO1 Sustainable development ≥ GRI MM6 governance Materiality

NWR Group strives to share with its » to explain NWR Group’s activities subsidiaries. Rather, it takes into account the stakeholders information about the risks designed to mitigate the risks economic, environmental and social impacts and opportunities of its business. We highlighted by stakeholders; and and benefits for stakeholders. defined our priority areas (GRI aspects) » to maximise the transparency and together with our stakeholders, we availability of data. The identified priority areas are also factored selected indicators, have set targets (see into the scrutinised risks and opportunities Scorecard pages 14–15), and have focused Performance in priority areas is measured (see page 34 and the NWR Annual Report and on improvement and measuring our by a set of indicators and a decision is made Accounts 2011, pages 24–27), whereby the performance. as to the depth in which they should be Group’s objective is to minimise the risks and covered. Monitoring and measuring of some to develop the opportunities for the benefit The Group assumes the following priority areas is dealt with more deeply than of stakeholders and the NWR Group. commitments: the GRI reporting framework (GRI indicators) requires. The table below shows the priority areas – » to use measurable indicators to define GRI aspects and concerns ranking them by long-term sustainability goals – see The identification of priority areas is not importance for stakeholders1. Scorecard on pages 14–15; and based solely on the financial implications 1 for or the costs and benefits to NWR’s The importance of the various priority areas was determined by means of a weighted matrix analysis in conjunction with continuous communication with stakeholders.

Priority area – GRI aspect (concern) Stakeholder NWR focus Economic results (weak financial Employees, community, investors, state All the activities described in this report and in the NWR Annual results) and municipal administration, schools Report and Accounts 2011 help ensure stable financial results Health and safety (insufficient Investors, employees, state and Our employees’ safety is a key priority1 included in the Group’s health and safety protection) municipal administration, community business strategy Employment (concern about loss Employees, state and local The Group’s policy is to maintain a stable number of employees of employment) administration, community, schools and to help train new employees2 Market presence (termination of Community, employees, investors, Long-term organic growth is one of the goals of the Group’s the Group’s activities in the region) schools business strategy Relations between workforce Employees, state and municipal The status of employees and Trade Unions in the Czech and management (disregard for administration Republic is regulated by the Labour Code. A number of the Winding towers of the Darkov Mine, the second largest mine in Ostrava-Karviná mining district. employees’ rights) activities and benefits that we provide go beyond the mandatory legal framework Energy (energy-intensiveness) State and municipal administration, Investments in infrastructure and modern technologies At the subsidiary level performance for every member of the management against conflicts of interests in the investors, employees (PERSP 2015 and CIP) will help reduce energy-intensiveness is assessed at regular management team; these plans comprise economic, subsidiaries take the form of a special Emissions, wastewater, waste State and municipal administration, Continuous environmental monitoring takes place at the meetings: fortnightly at OKD and weekly environmental and social objectives clause on conflicts of interests in every (air and water pollution, degradation community, investors, employees Group’s operations; the results are reported in detail to the of the countryside) relevant authorities and are summarised in this Report at OKK. Decisions taken at these meetings in line with the manager’s sphere of managerial or employment contract are included in the minutes taken by the responsibility. and a sworn statement signed by every Community (extraction and production Community, employees, state and As a company publicly traded on three European stock operations infringing on the municipal administration, investors exchanges NWR has to respect the law and ensure its good OKD Company Secretary. Management is employee. community’s rights) name is not tarnished assessed by the OKD board of directors, The remuneration of members of the which meets four times a year. subsidiaries’ boards of directors is Additional information on the NWR Community (downscaling of activities Community, employees, state and OKD has made a public commitment to devote 1 per cent of its undertaken to support the community, municipal administration, investors net profit to the OKD Foundation every year; the Group as a whole governed by the decisions of the sole governance structure is contained in the e.g. OKD Foundation activities) has traditionally supported sport, culture and mining traditions The remuneration of subsidiary shareholder, NWR NV, and is linked to the NWR Annual Report and Accounts 2011, Corruption (corruption) Investors, employees, schools The Group has adopted and rigorously abides by a Code of management is based on annual personal performance of the assigned tasks and pages 60–83. Ethics and, at the end of 2011, a new Business Integrity Policy plans (plan, expected result, actual result) regular assessments contained in the 9 Biodiversity (irrevocable harm Community, state and municipal In its business strategy the Group has committed itself to conclusions from the AGM . to the environment) administration, schools minimise the environmental impacts of its business over and above the legal requirements3; post-extraction reclamation is 9 The minutes of AGMs are published regularly required by Act No. 44/19884 at: http://www.newworldresources.eu/en/ Conflict of interests corporate-governance/shareholder-meetings Conflicts of interests in NWR are dealt 1 For more information see the Safety chapter on page 46. 10 The Articles of Association are available with in Articles 90 and 94 of the Articles 2 See the Training and Education chapter in the Our People section (page 53) and Education in the Community section (pages 90–91). at: http://www.newworldresources.eu/ 3 10 E.g. Dinopark in a reclaimed area, see case study on page 59. nwrplc/uploads/dlibrary/documents/ of Association and in Article 8.14 of the 4 According to Act no. 44/1988, on the protection and exploitation of mineral wealth (referred to as Mining Act), mining organisations are obliged to draw up a Comprehensive AoA_110804_web_n1.pdf Corporate Governance Policy. Safeguards Rehabilitation and Reclamation Plan for every 5-year period and to update it every year. 26 27

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 4.8 ≥ GRI 4.8 ≥ GRI 4.12 ≥ GRI 4.11 ≥ GRI DMA SO ≥ GRI 4.12 Corruption ≥ GRI 4.16 ≥ GRI DMA SO ≥ GRI DMA SO Public Ethics Compliance policy ≥ GRI SO2 ≥ GRI DMA SO Anti- ≥ GRI SO3 competitive behavior ≥ GRI SO4 ≥ GRI DMA SO and society Compliance ≥ GRI DMA PR Marketing communications ≥ GRI HR4 ≥ GRI SO5 ≥ GRI SO7 ≥ GRI MM7 ≥ GRI PR6

Respect for ethics and human rights development and makes sure they are related to fraud and bribery and notifies Under the whistleblower procedure, one Politics, lobbying NWR Group numbers of employees dismissed in 20111 In NWR the principles for upholding treated fairly. We respect the right of the Audit and Risk Management Committee case of sexual harassment was reported NWR Group does not support any political ethics and respecting human rights are our employees to organise themselves of the results and risk mitigation plans. in 2011. At the express wish of the affected party in any of the localities where it enshrined in the Code of Ethics and in Trade Unions and the Company is Reported suspicions of fraud and bribery individual the case was dealt with at the operates. NWR Group takes part in the Business Conduct1 which is implemented committed to cooperating with employees’ are investigated thoroughly and the results level of OKD without police involvement. process of the submission of comments in the internal regulations of Group. organisations. of the investigations, along with all the on draft legislation at national level in The aim of the Code of Ethics is to create evidence, are passed on to the appropriate In total 94 employees of the Group were the Czech Republic and Poland and at the long-term value through the fundamental Meritocracy Chief Executives and Boards of Directors. dismissed in the Czech Republic on the EU level through its active participation activities of the whole Group, which are We strive to promote a work ethic in which Depending on the nature of the breach of grounds of a particularly gross breach in industry sector organisations the exploration, development, production every individual accepts responsibility and the Business Integrity Policy, NWR may of obligations under Article 55 of (see page 33). and conversion of natural resources. is rewarded on merit. impose disciplinary measures or sever all Act no. 262/2006 (Labour Code of the The NWR Code of Ethics is founded on the contractual relations. If there is a suspicion Czech Republic). In 2011 NWR Group representatives following core values: Integrity2 that a crime has been committed, the participated in the consultation process We conduct our business with honesty and appropriate authorities are notified. Transparency for the amendment of the Mining Act6 Unexcused absence: 90 Respect for human rights fairness and seek to build a relationship NWR’s shares are publicly traded on the (Czech Republic) and the update Inprisonment not related to NWR: 3 We endorse the principles set out in the of trust with all our stakeholders3, NWR guarantees that a person who stock exchanges of London, Prague and of the National Energy Policy of the Other: 1 United Nations Universal Declaration in compliance with all the relevant reports bribery or fraud in good faith will Warsaw; and we are therefore committed Czech Republic. At EU level we supplied 1 Article 55 of Act no. 262/2006 of Human Rights and fully respect legislation. not face any adverse consequences. The to the greatest possible degree of comments on the following documents: (Labour Code of the Czech Republic). the fundamental rights of employees, person may report his suspicion through transparency. The Company regularly contractors and the communities in which Environmental protection the whistleblower procedure in person, publishes its results, both financial and » Position Paper on Resource Efficiency we operate. We are committed to equal and rehabilitation by telephone, by post, by e-mail or by fax, non-financial, and other information » Consultation on a Roadmap for NWR Group suspected irregularities opportunities and employ and promote We continuously monitor the impact of either to his superior or, at NWR level, to relating to its business. The NWR Annual a Resource-efficient Europe 5 2008 2009 2010 2011 employees based on their qualifications our activities on the environment. The the Company Secretary. A whistleblower Report and Accounts , drawn up in line 50 and performance. Accordingly, we refrain negative impacts of mining operations procedure forms part of the NWR Code with the IFRS (International Financial Projects to increase economic, 40 from making employment decisions based are continuously reduced through the of Ethics and the subsidiaries’ Codes of Reporting Standards as adopted by environmental and social responsibility 44 4 on gender, age, marital status, race, colour, number of reclamation projects and Ethics . the EU), is published every year. The Group subsidiaries are engaged 38 sexual orientation, disability, nationality, other measures in areas such as water The NWR Sustainability Report is drawn in economic, environmental and social 30 political belief, or religious affiliation. management or transportation. We focus The NWR Group has been analysed from up using the methodology of the GRI projects primarily in their place of 20 We do not tolerate any form of work place on mitigating the negative impact on air the point of view of corruption risk. Regular G3 Sustainability Reporting Guidelines operation, i.e. the Moravian-Silesian 21 harassment or physical abuse. quality. training in business integrity is organised (2006), including the Mining and Metals Region in the Czech Republic and 10 16 for the Group as an integral aspect of its Supplement, and is published once a year. the Silesian Voivodeship in Poland. Well-being and safety of our employees Corruption zero tolerance to fraud and bribery. NWR The annual reports are complemented Some projects, however, are implemented 0 NWR is committed to the highest standard In 2011 NWR Group expanded and Group has identified key employees at by other reports throughout the year. right throughout the Czech Republic of safety and health for its employees. elaborated on the principle of integrity three levels of management for whom As regards communication, the Group (e.g. OKD Foundation projects). Accordingly, the Company develops and enshrined in the Code of Ethics and in special training is staged. The total number follows the recommendations of APRA implements management systems that Business Integrity Policy, which were of such employees is 364. (Association of Public Relations Agencies, On a voluntary basis NWR KARBONIA are consistent with international best adopted in 2011. The Business Integrity www.apra.cz) and the PR Code of Ethics supports regional-level projects focusing practice and in full compliance with the Policy is consistent with the United Not a single case of corruption was which is annually reviewed. on education, coexistence with the relevant local legislation. NWR values all Kingdom Bribery Act 2010 and relevant identified in the NWR Group in 2011 and community and culture. its employees, invests in their professional local legislation. The Business Integrity no steps had to be taken against any Taxes and other mandatory contributions Policy has been incorporated into the employee. It was therefore not necessary are paid to national governments and Significant legal disputes internal regulations of NWR’s subsidiaries. in 2011 to change or cancel any contracts municipalities in the localities where we In 2011 NWR was not involved in any 1 The full wording of the Code of Ethics and with business partners, and no bribery- operate in (see page 94). significant legal disputes concerning Business Conduct is available at: NWR does not tolerate any kind of fraud related legal proceedings were initiated. monopolistic practices or breach of fair http://www.newworldresources.eu/en/ or bribery committed by its employees. NWR applies the precautionary principle competition or any other legal disputes corporate-governance/policies 2 The issue of Business integrity is covered Under no circumstances may an NWR Compliance with internal regulations (Article 15 of the Rio Principles) by of a commercial nature. in detail in the Business Integrity Policy Group employee offer, promise, solicit, and the law reducing the risks of its commercial (see http://www.newworldresources.eu/en/ receive or agree to receive anything of The NWR Group received 29 ‘whistleblower’ and production activities through the On the next page is an overview of corporate-governance/policies) 5 The NWR Annual Report and Accounts 2011 7 3 For NWR’s key stakeholders see page 30. material value intended to influence a notifications during 2011. Upon implementation of internal standards significant passive legal disputes NWR is available at www.newworldresources.eu 4 The Codes of Ethics of NWR’s subsidiaries business decision or activity. NWR does investigation none were found to be in the following areas: business risk was involved with in 2011. 6 Act no. 44/1988, on the protection and are published at http://www.okd.cz/en/ not differentiate between an employee sufficiently serious to justify dismissal on management, emergency plans, exploitation of mineral wealth (Mining Act), about-us/company-profile/code-of-ethics/ as amended. and http://www.koksovny.cz/en/about-us/ receiving or offering a bribe. The Group the grounds of breach of the Code of Ethics technological procedures, EIA process. 7 Passive legal disputes are disputes in which company-profile/eticky-kodex-2011 Risk Manager regularly assesses risks or the Business Integrity Policy. NWR or one of its subsidiaries is the defendant. 28 29

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 4.8 ≥ GRI 2.10 ≥ GRI 4.12 ≥ GRI 4.8 ≥ GRI 4.16 ≥ GRI 4.12 Ethics ≥ GRI MM7 ≥ GRI MM7 ≥ GRI SO5 ≥ GRI SO8 ≥ GRI SO7 and society ≥ GRI SO8

Projects to increase economic, environmental and social responsibility Internal documents applied in NWR Group

Entity Type of project 2008 2009 2010 2011 Stakeholders NWR OKD OKK NWR KARBONIA GRI issue covered by NWR Group document OKD Voluntary SAFETY Employees – Corporate Governance Rules Yes – – – 4.4 Mechanisms for shareholders and employees to provide recommendations or Voluntary Continuous Improvement Employees – direction to the highest governance body Voluntary POP 2010 Employees – Code of Ethics and Business Conduct Yes Yes Yes Yes PR4 (information about products Voluntary PERSPective 2015 Employees – and services) Voluntary OKD Academy Employees Schools Share Dealing Code Yes Yes Yes Yes – 1 1 1 Compulsory1 Comprehensive Rehabilitation and Reclamation Plan – State + Risk Management Policy Yes Yes Yes Yes PR2 (health and safety impacts of products) municipalities Business Integrity Policy Yes Yes Yes Yes PR6/PR7 (marketing, advertising, APRA) Voluntary Frenštát – Community + state + Collective Agreement2 No3 Yes Yes No3 LA4 (percentage of employees covered by Support Fund municipal authorities collective bargaining agreements) 2 Voluntary Environmental Monitoring Employees Municipal Plans and concepts for unforeseen situations, Yes Yes Yes Yes SO1 (partially) administration such as emergencies Voluntary Coal Quality Monitoring Employees Customers Provision of product information Yes4 – – – PR2 (health and safety impacts of products) OKK Voluntary POP 2010 Employees – (Coal/Coke Catalogue) PR4 (information about products and services) OKD Voluntary For Health programme – Community Foundation Crisis communication in the event – Yes Yes Yes SO1 (partially) Voluntary For Joy programme – Community of extraordinary events

Voluntary For the Future programme – Community 1 The NWR Risk Management Policy applies to the entire NWR Group. 2 The collective agreement applies to all employees of OKD and OKK (excluding contractors). Voluntary For Europe programme – Community 3 The status of employees is governed by legal regulations. 4 3 Applies to the entire NWR Group. OSSB Voluntary OSSB Employees Community NB: If an internal regulation (directive, policy, rules, agreements, or parts of agreements etc.) exists in the Group, ‘Yes’ is stated. If the area is not covered by a special regulation and is dealt with by general regulations, ‘No’ is stated with an explanatory note. 1 Mining organisations draw up (within the meaning of Czech Mining Office Decree No. 242/1993) a ‘Comprehensive Legend: Rehabilitation and Reclamation Plan’ for a five-year period, which is updated every year. POP 2010: Productivity Optimisation Programme 2010 2 Monitoring of dust levels, ground water, natural gas, subsidence etc. COP 2010: Coking Plant Optimisation Programme 2010 3 St Barbara Civic Association – OKD initiated the establishment of OSSB in 2004 and was also a founder member. PERSPective 2015 (see the Strategy chapter on page 21) OSSB: St Barbara Civic Association H. Action by the plaintiff Katarzyna Most important accolades received Green Frog Award Magdalena Klimoszek for EUR 17,345 on TOP Responsible Firm 2011 NWR received this award for qualifying in A. In the matter of Moravskoslezské C. Action by the plaintiffs Antonín and E. Action by the plaintiffs the grounds of mining damage to real Second prize for OKD’s ‘Safety First’ project the Central European Sustainability Report teplárny, a.s. securities Alice Macura for payment of EUR 617,950 Ing. Larisa Gerychová and Ing. Aleš Gerych estate. in the Workplace of the Future category. Award 2011 with its report ‘6 Steps Towards » action for compensation for damages in compensation for damages against OKD, concerning protection Conferred by Business for Society. Corporate Social Responsibility’. Conferred amounting to EUR 275,591 and EUR 585,446; » action for payment of EUR 617,950 of the personality and a total sum I. Action by the plaintiff Ing. Otakar Černý by Deloitte Hungary. » action for compensation for damages in compensation for damages on real of EUR 203,335 as the exercise for the protection of rights from an Czech TOP 100 caused by action in concert between estate. of the right to financial compensation improvement proposal and payment of » OKD came first among the most admired Moravian-Silesian Region Governor’s Award the accused in 1997, when they acquired for non-property damages. a sum of EUR 44,204,961. firms in the Mineral Raw Materials OKD came first in the competition for the shares for a purchase price of EUR 33 D. In connection with the purchase of Extraction category in 2011 Moravian-Silesian Region Governor’s Award per share, when the purchase price participating securities in ČMD, a.s., F. Action by the plaintiffs Zbigniew Waclaw J. Action by the plaintiff MUDr. Astrid » OKD came twelfth in the Top 100 Firms for Social Responsibility 2011 in the category according to the public draft contract on METALIMEX, a.s., and OKD, a.s., with Kolakowski and Věra Kolakowská Matúšová for EUR 8,786 on the grounds of the Czech Republic in 2011 of companies with over 250 employees. the purchase of shares for the remaining procedure pursuant to Section 183i et against OKD, on the grounds of mining of mining damages to real estate Conferred by the Czech TOP 100 association. shareholders was approx. EUR 65 per share. seq. of Act No. 513/1991, Commercial damage caused to real estate amounting (rock bounce). Zlatý středník Award Code, as amended, the following court to EUR 34,763. IR Award OKD’s weekly newspaper Horník came first B. Action by the plaintiffs Antonín and cases involving OKD are taking place: K. Action by the plaintiff Petr Siuda for In its communication with investors, in the Zlatý středník Awards in the category Alice Macura for payment of EUR 2,554 » Petition for review of the adequacy of G. Action by the plaintiffs the Parish Choir EUR 12,473 on the grounds of damages the media and the expert and general for The best internal newspaper in 2010. and EUR 1,452 counter-performance for OKD, shares of the Evangelical Church of Czech to real estate (rock bounce). public, NWR has for long stressed openness Conferred by PR Klub, o.s. » action for payment of EUR 2,554 and under ref. no. 26 Cm 114/2005; Brothers in Orlová and Ing. Jan Koňař and accessibility. NWR Group’s receipt of EUR 1,452 (linked to the dispute referred » Petition for review of the adequacy of on the grounds of mining damages A detailed list of significant legal disputes the award for Best Corporate Website to in point C below) on the grounds of counter-performance for OKD, shares to real estate amounting to approx. is given in the OKD Annual Report 2011, is clear evidence of this policy. Conferred compensation for damages for repair under ref. no. 15 Cm 138/2005 (Municipal EUR 142,334. Notes to the Financial Statements. by the London-based Investor Relations of a wastewater treatment plant in Court in Prague). Society (IR Society). connection with mining damages and NWR Group did not pay any major8 fines lost earnings on the rent of non-residential and no non-financial penalties were 8 NWR defines fines exceeding EUR 40,667 property. imposed on any subsidiary in the Group. (CZK 1 million) as major fines. 30 31

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 4.14 ≥ GRI 4.15 ≥ GRI 4.15 ≥ GRI 4.16 ≥ GRI 4.16 ≥ GRI SO1 Relations and ≥ GRI SO1 communication with stakeholders

NWR Group maintains a regular Stakeholder Frequency communication with stakeholders1. Indeed (ranked by priority) Form of communication of communication Responsibility this Sustainability Report is intended Table continued primarily for our stakeholders. 1 Community2 Employees3 Employees Trade Unions – Collective Agreement 1x per year Subsidiaries’ management NWR Group is fully aware of the Trade Union representatives 5x per year in Supervisory Committee importance of communicating with our internal (e.g. employees) and external key Joint commissions 4x per year Subsidiaries level (e.g. Health and Safety Committee) stakeholders (e.g. community). Code of Ethics Continuous We maintain regular dialogue with both Investors, Internal meetings Continuous Lower level of subsidiaries’ management internal and external stakeholders, at Schools shareholders, Horník weekly Weekly Subsidiaries’ PR and local, national and at the international analysts www.ihornik.cz communication unit level. Regular dialogue contributes Stakeholders Zdař Bůh trade union newspaper biweekly Trade Unions significantly to identifying the areas that our stakeholders consider important. OKD AKTUÁLNĚ (employees’ newsletter) As required OKD’s PR and communication unit Intranet Continuous HR and PR units Notice boards Subsidiaries State Electronic correspondence All administration Customers and municipal Investors, Financial results announcements and reports Quarterly, half-yearly, Investor Relations department shareholders, yearly administration analysts Trading updates and pricing announcements Quarterly Annual General Meeting Once a year Suppliers4 Meetings with investors and analysts (roadshows) Twice a year Other communication (e-mail, telephone, Continuous www.newworldresources.eu) 1 Stakeholders are defined as entities or individuals that can reasonably be expected to Open Mine, New World Resources magazine Quarterly Corporate Communications department be significantly affected by the organisation’s activities, products, and/or services; and whose State Working with local authorities, including permission Regular and ad hoc Subsidiaries’ management actions can reasonably be expected to affect and municipal proceedings, EIA proceedings, social affairs, meetings of various the ability of the organisation to successfully administration comments on legislation etc. commissions, individual implement its strategies and achieve its meetings, participation 2 objectives. at Tripartite meetings 2 Inhabitants living in an area of NWR Group Open Mine, New World Resources magazine Quarterly Corporate Communications department activities, municipalities and associations of municipalities, local non-profit organisations etc. Horník weekly Weekly OKD’s PR and communication unit 3 Employees (represented by Trade Unions) and www.ihornik.cz their families. 4 Suppliers, including contractors. Suppliers, Communication and meetings between the purchasing Continuous Subsidiaries’ purchasing departments including department and individual suppliers contractors Open Mine, New World Resources magazine Quarterly Corporate Communications department Stakeholder Frequency Customers Customers’ communication and commercial Continuous Subsidiaries’ commercial departments (ranked by priority) Form of communication of communication Responsibility departments Community Regular meetings with municipality representatives Regular, several times Subsidiaries’ management a year Open Mine, New World Resources magazine Quarterly Corporate Communications department Meetings with inhabitants As required PR units of subsidiaries Schools Regular meetings with schools’ representatives, Continuous Subsidiaries’ management awarding of research projects, job fairs et al. Surveys (written, electronic) Open Mine3, New World Resources magazine Quarterly Corporate Communications department Web sites (www.newworldresources.eu, www.okd.cz, Continuous PR units of NWR, NWR subsidiaries, www.koksovny.cz, www.nwrkarbonia.pl, OKD Foundation 1 NWR operations employees are represented by 5 Trade Union organisations. For more information see page 45. www.hbzs-ov.cz, www.nadaceokd.cz) 2 Through the membership in the Confederation of Industry of the Czech Republic and The Employers’ Association of Mining and Oil Industries. 3 Open Mine is also distributed mainly to leading Czech and foreign universities. Participation in meetings of OKD Foundation, OSSB Continuous Subsidiaries’ management (St Barbara Civic Association) et al. and OKD Foundation Educational activities (brochures, leaflets, Continuous NWR’s and subsidiaries’ PR web microsites, etc.) and communication unit 32 33

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 2.7 ≥ GRI 4.13 ≥ GRI 4.15 Relations and communication with stakeholders

Additonal stakeholders Contractors – supplier companies Among our additional stakeholders we rank whose employees1 perform the media and the expert public. development, mining and construction works in OKD Mines: Membership in industrial organisations ALPEX-PBG, Sp. z o.o. (Poland) In total, we are members of 12 industrial CARBOKOV, s. r. o. (CZ) organisations. CZ BASTAV, s. r. o. (CZ) Pol-Alpex, s. r. o. (CZ) A full list is available on the web site POLCARBO, s. r. o. (CZ) http://www.newworldresources.eu/ Společnost důlních prací, s. r. o. (CZ) en/about-us/membership THK-ČECHPOL, s. r. o. (CZ) TKBČ, s. r. o. – organisational unit (CZ) We regard membership of the VOKD, a. s. (CZ) Confederation of Industry of the Czech WPBK-BIS CZ, s. r. o. (CZ) Republic and the Mining Union as the most important important (see section Politics, 1 Average monthly number of contractors in lobbying in chapter Ethics and society on 2011 was 4,435. page 27).

In Euromines we were actively involved in the agenda of the Euromines Communication Committee.

As no extraction took place in Poland in 2011, NWR KARBONIA is not presently Paskov Mine – monorail shortens miner’s way to the workplace. The winding tower of the Darkov Mine, mining site 2. a member of any organisation. In 2011 it is scheduled to apply for membership of the

The following firms are among the Group’s most important suppliers Mining Chamber of Industry and Commerce (www.giph.com.pl). RPG RE Land, s. r. o. (CZ) real estate lettings Dalkia Commodities CZ, s. r. o. (CZ) electricity supplies Dalkia Industry CZ, a. s. (CZ) supplies of thermal energy, compressed air and distribution of electricity Caterpillar Inc. (USA) longwall equipment sets and belt conveyors Eickhoff Bergbautechnik GmbH (DE) shearers Sandvik Mining (SE) roadheaders dh mining system gmbh (DE) drill jumbos and roadheaders FITE, a. s. (CZ) stage loaders and (driveage) haulage systems FAZOS S.A. (PL) LW shields RYFAMA S.A. (PL) AFCs (armored face conveyors) ArcelorMittal Ostrava, a. s. (CZ) materials and spare parts Metalimex, a. s. (CZ) materials and spare parts Bucyrus Czech republic, a. s. (CZ) materials and spare parts

NWR Group’s principal customers are listed on page 1 and in the NWR Annual Report and Accounts 2011 on page 5. 34 35

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 1.2 ≥ GRI 1.2 ≥ GRI EC2 ≥ GRI EC2 Sustainable ≥ GRI SO1 ≥ GRI SO1 risk assessment

NWR seeks to systematically anticipate Risks their impact on the Group. The Audit and Opportunities and minimise risks and to make NWR Group applies a risk management Risk Management Committee oversees risk Besides risks, NWR Group’s business also constructive use of opportunities that are system that guarantees an effective management in the NWR Group. A register presents opportunities which have an viewed a paramount by key stakeholders, approach to identifying risks to the of risks is maintained at Group level and is impact on sustainability and which the management and shareholders. Group’s strategic business objectives and regularly updated. Group considers important. In developing mitigating their impacts. The operational these opportunities, NWR Group actively In this Report we pay attention primarily risks are monitored and managed by NWR’s steers its activities towards the priority to non-financial risks and opportunities subsidiaries. areas defined by stakeholders. The linked to NWR’s sustainable development Head of Corporate Communication as formulated in our dialogue with our It is the Group Risk Manager’s job to and Sustainability is responsible for stakeholders. For information about the implement responsible processes and developing opportunities, in cooperation management of financial, production and coordinate activities linked to risk with employees from the relevant units of commercial risks, including a full overview management. Risks are monitored individual NWR’s subsidiaries. of these risks, see the Risk management continuously and are assessed at least section of the NWR Annual Report and once a year to ensure an effective Accounts 2011. approach to analysing risks and mitigating

Selected risks Opportunities

Risk and impact Measure Opportunity Description Health and safety at work » tightening safety regulations High share of employment in the region With a total of 18,775 employees and contractors (state as at 31 December 2011), NWR is the NWR operates in some of the most demanding geological » enlarging the longwall protection zones in mines largest employer in the Moravian-Silesian Region of the Czech Republic. In Karviná district conditions in the world, so health and safety at work are » installing new equipment that can localise stress in rock NWR gives work to 7.6 per cent of the population; in the district capital Karviná the share paramount. Disregarding safety regulations can put lives » installing employee movement monitoring systems for employees working in of employment is 12 per cent and in some municipalities (Stonava, Albrechtice u Českého at risk. Unforeseeable geological phenomena, such as rock areas with unforeseeable geological phenomena Těšína) it is as high as 20 per cent. Such a high share of employment in the local community bounces and movements, are another key factor. » analysing rock bounce prevention methods with international experts is an opportunity for better cooperation with the region, especially in the social, health, environmental, educational areas et al. Shortage of skilled labour » active cooperation with schools and universities Being unable to attract and retain labour with the right » provision of scholarships Communication with the community Continuing dialogue with the local community is a necessary condition of our existence qualifications could endanger targets. » employment of school-leavers and at the same time an opportunity to explain all the influences the Company has on the » support for vocational and secondary mining education local community. It is important to explain how the mitigation of impacts of extraction now is different from in the past. Our employees play a significant role in our communication The following factors play a motivational role: (see High share of employment in the region). » career prospects » wage levels Ethics The Code of Ethics and Business Integrity Policy are the principal internal documents » employee benefits provided under the Collective Agreement for 2010–2012 that help both cultivate the business environment in NWR and, through contacts with our suppliers, customers and partners, improve the broader business environment. Environmental risks » implementation of new extraction methods Activities that can cause harm to the environment, » reclamation projects wherever a territory has been affected by the Activities of the OKD Foundation The OKD Foundation allows us to give something back to the region, and to do so in a way affecting primarily the local community and giving rise consequences of our activities1 that goes beyond our legal obligations. to a reputational risk. » open communication » respecting the needs of the local community Transparency Being listed on three European stock exchanges (London, Prague, Warsaw) makes it imperative for NWR to be fully transparent in all regards. For example, NWR is bound by the Rules of Legislative risks » communication with regulators and other stakeholders regarding the the London Stock Exchange1 and is obliged to report all events and circumstances related Changes to the legislation linked, for example, to preparation of legalislation or policies to its business (items G1050 and G1051 of the Rules). These obligations and rules create an expropriation of property or payments on extracted coal. opportunity for NWR to win the trust of the community and other stakeholders. For example, OKD is involved in the consultation process on the draft Mining At the same time the Sustainability Report markedly enhances NWR’s transparency. Act (CZ) and National Energy and Raw Materials Policies of the Czech Republic. Reclamation projects Clearing up the consequences of mining represents a fundamental investment in Impact on the community » emphasis on the transparency of our activities environmental rehabilitation. We see an opportunity in greater community engagement in NWR development and production activites are viewed with » open communication with the community, state and municipal administration, the preparation of reclamation projects which have important social and biological value great sensitivity. Ignoring on the rights of the community or employees and other stakeholders (e.g. Lipiny Golf Resort2). behaving inappropriately towards the community can harm » role in the development of the local community2 NWR and its future in the region. Improving governance Constantly improving the effectiveness of the management structure of NWR and its subsidiaries is an integral part of corporate governance policy. Opportunities include the full Communication risks » timely, accurate and open communication about all NWR Group’s activities implementation of the SAP system and changes to the organisational structure. Inaccurate media information linked to our future plans and future plans and continuous dialogue with the community are part of our may influence attitudes towards NWR Group in the communication strategy 1 You can find the London stock exchange rules at http://www.londonstockexchange.com/traders-and-brokers/rules-regulations/rules-regulations.htm community and in other stakeholders. 2 More information on the Lipiny reclamation project can be found in the Environment chapter on page 58 and at www.golflipiny.cz

1 More information on reclamation projects is given in the Environment chapter on page 57. 2 More information on community support activities is given in the Community chapter on pages 84–93. 36 37

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Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI SO1 ≥ GRI SO1 Responsible mining practices throughout the life cycle

Case study Case study At the local industrial school that A paradise for anglers and water-sports of it was altered to make it merge with Community engagement at Dębieńsko, forms part of the Integrated school in An industrial zone, and a lake on the site enthusiasts the adjoining terrain better. The heart of Poland Czerwionka-Leszczyny, NWR KARBONIA of the former František Mine The territory will be divided into six the newly created area is Nebesák Lake. has supported the introduction of classes units for revitalisation purposes. The lake has already become a popular The announcement of plans to rebuild that specialise in mining. What is most The František Mine was founded in 1911 The reclamation of each unit will have haunt for anglers and a popular centre the Dębieńsko mine raised questions important is our guarantee that students and was named after the successor to its specific aspects and objectives. for water-sports and relaxation. As part about the future of the municipality of mining will receive work experience at the Austro-Hungarian throne František Landscape reclamation has currently of the reclamation work the banks were of Czerwionka – Leszczyny, and some the mine. Moreover, we have introduced Ferdinand d’Este. The first colliery been completed. Biological reclamation reinforced with quarry stone. Next they people were suspicious and negative a system of rewards to incentivise cars began to bring their loads of coal is the next step. The project’s execution will be covered with earth, grassed over towards the project. Our first priority, students. We invited students to to the surface in 1913, when the pit and goals were discussed with local and planted with trees. therefore, was to engage with the local participate in the traditional celebration excavations were completed. From 1946 government representatives and are community and build good relations of St. Barbara’s Day. During a ‘beer hall’ to 1989 the mine was renamed after consistent with the zoning plan for The Castaldonovka basin that was used with local government representatives. feast young people (known as foxes) Klement Gottwald, the first communist the town of Havířov and Horní Suchá to store waste rock and power-plant NWR KARBONIA organised a series of participated in the ceremony of skok president of Czechoslovakia. It achieved municipality. Three former sludge basins fly ash was also incorporated into the informative meetings to explain our przez skórę, which roughly translates as its record extraction output of 1.7 were filled in with waste rock, covered by reclamation project. But as protected intentions. We focused on informing ‘jump over the leather apron’, a traditional million tonnes in 1978. In the days of earth up to the surrounding terrain level species of flora were found to be people about our system of assistance mining initiation rite that sees young men the greatest demand for ‘black gold’ the and grassed over. The afforested waste recolonizing the area, this part of the for residents in mining areas, and accepted as miners. mine employed as many as 3,400 people. rock dump was preserved in its current project was dropped. on explaining the main benefits of The mine got its original name back after state as far as possible; only one part opening the mine. We began supporting Although the fact that the Dębieńsko the ‘Velvet Revolution’ in 1989. community activities and participating development project is in the early in various local events. We also worked phases of construction, NWR KARBONIA For geological and other reasons to develop a reputation as an open, already feels like part of the local extraction gradually declined to below responsible and responsive company. community. We support the local miners’ 1 million tonnes a year and the mine brass band, the local scout troop, and was merged with the Dukla and Lazy Our goal is to maintain good relations other initiatives such as charity concerts mines into the Lazy Combined Mine. with our stakeholders and to ensure open and talent competitions for teenagers. As the František mining site was not and ongoing communication with them. In the year 2011 we provided donations economically effective, extraction was and sponsorship funding for a variety discontinued on 30 June 1999. We support residents who could be of community organisations, including Former František Mine became an industrial zone. Currently there are several dozens of companies located within the industrial zone. affected by mining activities. In the the District Extramural Work Centre and Brownfield of the Year 2010 year 2009 NWR KARBONIA launched sports clubs. The site was subsequently revitalised an assistance programme for people and an industrial zone was built there, who want to build a house in areas that This year NWR KARBONIA intends to financed from public and EU funds. may be affected by mining. We made launch a variety of new projects under Construction ended in 2009. In 2010 a commitment to reimburse the costs the heading of ‘NWR KARBONIA – good the site was declared winner of the of reinforcing their house foundations neighbour’. Brownfield of the Year competition with regard to potential subsidence organised by the Ministry of Industry and movement. Despite our best and Trade of the Czech Republic and engineering efforts and intentions to CzechInvest. eliminate or at least minimise such damage, it can still occur. Therefore, At the end of 2010 there were 25 firms our commitment concerning property occupying around one third of the Symbolically, on the feast day of miners’ patron damage compensation is ongoing. In the St. Barbara, ceremony launching construction industrial zone and employing over year 2011 we accepted 33 applications, works took place in the renovated Hall of 300 people. If the firms that have leased with a combined compensation of Traditions of Dębieńsko mine in municipality the rest of the complex implement Czerwionka-Leszczyny. Construction began approximately EUR 170,000. by symbolic first dig of the Slope 1 box-cut, the projects they are working on, which is one of two planned slopes of the mine. the industrial zone could employ up to Construction of Debiensko Mine is the largest around a thousand people. development project of NWR and coal production is planned to start in 2017. New World Resources Sustainability Report 2011

NWR operations – average number Proportion of NWR Group employees NWR operations – LTIFR LTIs per million hours hours NWR operations – Absentee rate3 number of days lost per cent of training hours per employee covered by a Collective Agreement Our people 2008 2009 2010 2011 2008 2009 2010 2011 2008 2009 2010 2011 15 25 1,600 Yes 99.90% 1,599 No 0.10% 12 20 21.8 1,280 12.07 NWR operations1, 2 Lost Time Injury 1,208 1,238 9 10.85 15 18.6 960 1,167 Frequency Rate (LTIFR) 8.25 6 7.64 10 12.4 640

3 5 320 4.6 0 0 0

Highlights NWR operations Lost Time Injury Frequency Rate2 (LTIFR) down by 37 per cent over the past 4 years NWR Group voluntary employee turnover down to 1.17 per cent in 2011 Average number of hours of training per employee reached 21.8, a year-on- year increase of 17 per cent NWR operations Absentee Rate (‘AR’) among employees down by 23 per cent over the past 4 years OKD successfully rolled out a contact-free system for monitoring persons in mines

1 NWR operations comprise subsidiaries performing regular extraction and production in 2011, i.e. OKD (including HBZS) and OKK. 2 Including contractors. 3 The absentee rate shows the total number of shifts lost due to absence (work injuries, occupational disease and non-occupational illness, not including holiday and maternity leave) relative to the total time worked times factor 200,000. Does not include contractors.

Photo: On a way to working place in Karviná Mine mining site Lazy. 40 41

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI DMA LA ≥ GRI DMA LA Labor Employment / management ≥ GRI DMA LA relations Occupational health ≥ GRI DMA LA Training and safety and education Human resources strategy ≥ GRI DMA LA Diversity and equal opportunity ≥ GRI DMA HR and employee care Non-discrimination ≥ GRI DMA LA Freedom of association and collective bargaining

NWR Group is the largest employer in the have far-reaching consequences. Coke their sense of responsibility for their Moravian-Silesian Region and employs production is also very specific work – health and the health of their colleagues. more than 18,000 people. Directly or for example, hazardous chemicals are That is why NWR places considerable indirectly, its business and activities affect handled in operations running at a high emphasis on training employees in safety the lives of almost all the inhabitants of the temperature. Tonnes of extracted coal, issues, and why its subsidiaries hold region, and in particular the Karviná district. the quantity of coke produced, business motivational competitions and organise The Group is aware that its business results – none of these has the value of internal campaigns. activities and long-term future needs human health and life. The NWR operations high-quality, educated and loyal employees. Lost Time Injury Frequency Rate was For the eventuality of hazardous situations Work in mines is difficult and employees successfully reduced to 7.64 in 2011. all NWR operations have emergency plans must satisfy the given medical requirements. and crisis communication plans setting out In the years 2008 to 2010 the Company detailed procedures for various types of In 2011 there was a fall in voluntary made a large investment of EUR 20 million emergencies or accidents. employee turnover to the lowest level ever in state-of-the-art personal protection gear (1.17 per cent). This drop was caused by under the SAFETY 2010 programme. In 2011 Despite all of the above measures, there several factors. Compared to the regional this programme was followed by further were five fatalities in NWR operations and national levels, Group employees concrete measures to increase safety, such in 2011 which remind us that deep-level receive above-average remuneration. as the introduction of monitoring of mine hard-coal mining continues to involve That is of course just one of the ways workers’ movements (see the case study daily encounters with forces of nature the Company tries to reward motivated on page 51) and the preparation of a central and uncontrollable phenomena employees who can cope with the control communication system expanding (e.g. rock bounces) that need to be treated demanding work hundreds of metres the current system’s functions. The main with respect and caution. Unfortunately, below ground and on the surface. At the requirement is to ensure communication the technological means that would be same time, the Company provides a broad between the worker down in the mine able to guarantee absolute safety when spectrum of financial and non-financial and central control. Another practical working many hundreds of metres below benefits, often going beyond legal example is the replacing of original miners’ ground do not exist at present. requirements. helmets with new ones that have an integrated protective shield. The POP 2010 The Group’s long-term goal is to provide The Company also places great emphasis investment programme led to a pronounced employees with the maximum possible on paying its employees fairly. The improvement of work safety and hygiene, degree of occupational health and safety, remuneration system is set up differently mainly thanks to the improvement in combined with above-average earnings for different job positions. Remuneration the microclimatic conditions in mines and supported with a number of benefits. Thanks to the new personal protection aids the work underground became safer than before. takes into account the quantity and quality following the installation of mine-wide and These long-term goals are transposed into of work done. In 2011 OKD rolled out the machine-specific air conditioning systems. measurable values. One of the ambitious of NWR operations reached 21.8 hours Human rights Relations between management HR module in the SAP system (it will be Automatic water spraying onto the coal face goals is to reduce the LTIFR in NWR in 2011. This indicator has risen by NWR Group adopts a strict approach and employees launched in OKK in 2012) and continues and surrounding rock significantly reduces operations to a value of 5 by 2015. 376 per cent since 2008. The Company to equal opportunities when recruiting Relations between the NWR Group’s to work on unifying and standardising dust levels at longwalls, in some cases by has pledged to ensure that this indicator new employees, when assessing subsidiaries and employees are clearly the remuneration system at all the firm’s as much as 60 per cent. The introduction Another aspect of care for employees is does not fall below 20 hours of training their performance and as a part of defined by the Collective Agreement workplaces. The pay system is linked to of the new development technologies care for their health. In 2012 OKD plans to per employee per year. Keeping records the remuneration process. If a case negotiated with the Trade Unions for the the performance management system enlarged the area of the opening that unify medical care for employees. of and, above all, better planning of every of discrimination is identified, the 2010–2012 period. Relations between and job classification system. The accesses the coal face, which led to better In practice this means that employees’ employee’s training, will be aided by subsidiaries in the Group follow the the employer and the Trade Unions are Company applies the principle of direct air circulation and improved microclimatic health check-ups will only be done by deeper implementation of the SAP system procedure for reporting dishonest constructive and fair, even though each linking of remuneration to performance conditions. New air conditioning units contractual doctors who will be informed in 2012. practices described in the Code of side defends the interests of a different in combination with the achievement of can also be fitted at the longwalls which about their work positions and will thus Ethics. Any cases of discrimination group. At the end of every year questions individual and group targets. was not possible with the older mining be better able to decide on injuries or The Company wants both to further against employees and contractors are of wage developments for the coming technology. This improvement of the illnesses with regard to an employee’s support lifelong training for employees investigated within NWR Group and in period are discussed, taking into account Occupational health and safety hygienic conditions in workplaces will also health. For employees this will mean better and to make mining-related subjects more collaboration with responsible authorities. both the macroeconomic situation and The Group’s employees work in a very continue in the coming years. The aforesaid protection of their health. attractive in schools. Greater employee the Company’s current financial position. demanding environment, at depths up to safety measures also apply to contractors. involvement in the education of mining Our employees’ rights to assembly and The Collective Agreement also describes 1,100 metres below ground and in surface Employee training students at the Technical University of to strike are based in the Czech and voluntary benefits each of the NWR Group’s operations. NWR Group is aware of the risks The Company understands that the key NWR is aware that its future depends on Ostrava, bringing a practical element and Polish legislation (these rights also apply subsidiaries have committed to providing stemming from difficult work below ground, factor in improving occupational health skilled and motivated people. The average experiences to the classroom process, to contractors) and in the concluded to employees. where seemingly unimportant details can and safety is motivating employees and number of hours of training per employee should help these efforts. Collective Agreements. 42 43

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI 2.8 ≥ GRI LA2 ≥ GRI EC7 ≥ GRI LA13 ≥ GRI LA1 Employment ≥ GRI LA13 Structure of the NWR Group workforce

NWR Group is one of the largest private If we take into account indirect NWR Group’s indirect employment NWR Group is fully aware that skilled per cent employers in the Czech Republic. As of employment, i.e. the proportion including in the Moravian-Silesian Region employees are the most precious asset 31 December 2011 the Group employed all products and service suppliers to NWR it possesses. That is why the Company a total of 18,775 people, 14,243 of whom operations (multiplication by a coefficient strives to attract and retain new were employees1 and 4,532 contractors. of 23), NWR Group’s closure would increase employees. If working for Group companies unemployment in the Moravian-Silesian is seen as sufficiently attractive, this will In the Moravian-Silesian Region NWR Region by 7.5 per cent. According to the pave the way for further reductions in Group directly accounts for almost Ministry of Labour and Social Affairs in employee turnover. The Group succeeded 4 per cent of total employment2, but in the Czech Republic, the average rate of in reducing the rate of voluntary employee some municipalities NWR Group employees unemployment in the Moravian-Silesian turnover to a value of 1.17 per cent in 2011. and contractors make up a major share of Region was 11.13 per cent in 2011. NWR the economically active population. Group’s closure would therefore push that However, in total 2,860 people left the In Karviná, for example, Group employees rate up to almost 19 per cent. Group in 2011. The NWR Group’s employees and contractors represent almost and contractors work in very demanding OKD + OKK employees and contractors 7.53% 12 per cent of the economically active conditions and that is reflected in the Other employees 81.34% population; in Albrechtice u Českého proportion of men in the workforce: Unemployed 11.13% Těšína 18 per cent; and in Stonava almost in 2011 men made up 94 per cent of the total 22 per cent. workforce. The biggest age group among men is 30–50 years of age (64 per cent), followed by men aged over 50 (24 per cent).

OKD OKD NWR NWR In front of transport cages before going down in mining site Staříč of the Paskov Mine. NWR Plc NWR NV (employees) (contractors) HBZS OKK KARBONIA Communications, s.r.o. Total Average number of employees 5 19 13,305 4,435 189 739 14 4 18,710 in the year Number of employees as 6 19 13,271 4,532 190 732 20 5 18,775 of 31 December 2011 Full-time 6 15 12,924 4,531 190 730 19 5 18,420 Part-time 0 4 4 1 0 0 1 0 10 Employment for indefinite period 6 18 12,928 4,532 175 731 19 5 18,414 Employment for fixed period 0 1 343 0 15 1 1 0 361

Total number of employees who left NWR Group’s main companies in 2011 1 Unless specified otherwise, we use the term NWR Group’s direct employment in the NWR operations – voluntary employee turnover per cent and percentage shares thereof NWR Group Per cent employees to mean the Group’s permanent Moravian-Silesian Region in the Czech Republic employees working in OKD mines and surface as of 31 December 2011 (per cent). 2008 2009 2010 2011 Total number of employees who left their jobs in 2011; 2,860 15.2 operations. 2.0 these as a percentage of total employees 2 The total number of employees represents Moravian-Silesian Region of the workforce, i.e. the number of employees the Czech Republic 1.6 of which: men 2,787.0 97.4 with a sole or main employment based on the Bruntál up to 30 572.0 20.5 Labour Force Survey (sliding average of the 1.46% 0.47% 1.2 1.37% past four quarters) + the number of third- 1.23% 30–50 1,477.0 53.0 country nationals with a valid employment 1.17% 0.8 permit, employed EU citizens registered by Opava over 50 738.0 26.5 the labour offices (sliding average of the past 0.14% of which: women 69.0 2.4 12 months) and foreign nationals with a valid Karviná 0.4 Ostrava trading licence (sliding average for the past 8.33% Poland up to 30 7. 0 10 .1 2 six-month periods) + the exact records of 1.22% 0 registered, i.e. employable, unemployed job 30–50 13.0 18.8 Nový Jičín seekers, Czech citizens and EU (EEA) citizens over 50 49.0 71.0 maintained by the labour offices by job seekers’ 0.51% place of residence. Source: Integrated portal of Frýdek-Místek NB: Rounding of figures means the total is not always 100 per cent. the Ministry of Labour and Social Affairs of the 2.03% Czech Republic (http://portal.mpsv.cz). 3 See the Heating Industry Study, Prague University of Economics, 2011, pages 119–122, available for download from the web site of the Ministry of Industry and Trade of the Czech Slovakia Republic (www.mpo.cz/dokument85256.html). 44 45

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI EC3 ≥ GRI DMA HR ≥ GRI EC5 Non-discrimination ≥ GRI LA3 ≥ GRI DMA HR ≥ GRI LA14 Freedom of association and Employee Trade Unions collective bargaining ≥ GRI LA4 ≥ GRI LA5 ≥ GRI MM4 remuneration ≥ GRI HR5

NWR Group gives its employees Employee benefits in NWR Group operations OKD HBZS OKK In the Czech Republic, Article 24 of Act above-average financial remuneration No. 262/2006, the Labour Code, provides Health care contribution Yes No Yes relative to average wage in that Trade Union organisations conclude Moravian-Silesian Region (e.g. the average Retirement provision Yes Yes Yes Collective Agreements also on behalf of monthly wage in OKD in 2011 was Life insurance Yes No No employees who are not members of a trade EUR 1,484 and the average starting wage Disability insurance, insurance against consequences No Yes Yes union. The advantages stemming from the was EUR 620) and a whole series of other of injuries concluded Collective Agreement therefore non-financial benefits that are guaranteed apply to all a company’s employees. Based Parental leave1 Yes Yes No by a Collective Agreement. For the sake on this rule it is fair to say that 99.9 per cent Stock options Yes No No of comparison, the average wage in the of core employees are covered by Moravian-Silesian Region in 2011 was Holiday bonus Yes Yes No a Collective Agreements in NWR Group. EUR 932 and the minimum wage in the Christmas bonus Yes Yes No Czech Republic was EUR 300. Notice period Meals contribution Yes Yes Yes The Labour Code sets a minimum notice Wages in NWR Group are either tariff-based Canteen Yes Yes Yes period of 2 months. This minimum period is or, in selected positions, employees receive Contracted bus transportation Yes No No also enshrined in the concluded Collective an individually set wage. The key factors Protective drinks and vitamins Yes Yes Yes Agreements. determining wage levels are the employee’s Contribution to children’s recreation Yes No Yes performance, the results achieved by the In NWR KARBONIA the notice period worker himself, resulting intention of the Contribution to family recreation No No Yes is governed by the applicable Polish Company to keep the worker and the entire Work with seniors Yes No Yes legislation (Dz. U. 1974 nr 24 poz. 141, Communication hundreds of meters underground is as important as in the offices on the surface. NWR Group results (EBITDA). Men and Anniversary bonuses No Yes Yes Kodeks pracy): women enjoy equal pay conditions in Relaxation stays Yes No Yes NWR Group. » 2 weeks if the employee worked less Workers’ right to assembly and to Culture and sport contribution Yes Yes Yes than 6 months strike is laid down in the Fundamental As the aforesaid age structure indicates, Bonuses and donations No Yes Yes » 1 month if the employee worked for Charter of Rights and Freedoms of the Czech Republic, in Poland’s Ustawa the Group’s long-term goal is to recruit Remuneration for work standby, contribution to blood donors Yes Yes Yes 6 months and more high-quality, educated workers and thus » 3 months if the employee worked for o rozwiązywaniu sporów zbiorowych Social contribution No No Yes guarantee the continuity of NWR Group’s 3 years and more (Dz. U. of 26 June 1991) and in concluded business. NWR Group subsidiaries Special contribution for miners Yes No No Collective Agreements. cooperate with various types of schools, 1 week vacation prolongation Yes Yes Yes take part in student careers fairs etc.1 There were no strikes in NWR Group in 2011. Increased severance pay after termination of employment Yes Yes Yes on grounds of organisational change based on a Collective Agreement Financial contribution to pension insurance No Yes Yes Option of allocation of a flat with a 15 per cent discount Yes No No from market rent

1 For example, the provision of extra working leave with wage compensation for one day per quarter for single women Coverage of NWR Group employees There are five Trade Union organisations per cent and men carying for a child or a relative requiring special care. by a collective agreement within the Group OKD Federation of Mining Unions Federation of Right-wing Trade Unions of the Czech Republic Independent Professional Trade Unions of Technical and Economic Employees of OKD OKK Mining, Geology and Oil Industry Trade Union HBZS Trade Union Organisation of OKD, HBZS, a.s.

1 For information about cooperation with schools Yes 99.90% see the Community chapter on pages 90–91. No 0.10% 46 47

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

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≥ GRI LA6 ≥ GRI LA7 ≥ GRI LA7 Safety ≥ GRI LA9

The Group’s supreme body is the Safety, Safety principles in NWR mining NWR operations – LTIFR LTIs per million hours Health and Sustainability Committee operations applicable to all employees (the ‘Committee’)1, which supports the 1. Comply with all laws, decrees, 2008 2009 2010 2011 15 Board of Directors in decision-making on regulations and other provisions related matters of safety and employees’ health. to occupational health and safety. 12 2. Look for, assess and eliminate potential 12.07 OKD occupational health and safety2 dangers with regard to risks to 9 10.85 Given the common interest of OKD employees’ life and health. 8.25 6 7.64 and its employees as represented by 3. Systematically monitor occupational Trade Unions, there is an Occupational health and safety management. 3 Health and Safety Committee (‘OHSC’) 4. Acquire new technologies mainly composed of representatives of the with a view to ensuring the safety 0 employer, employees and the state of employees and reducing risk levels mining supervisory authority. The OHSC at work. represents all the OKD employees 5. Make all employees more alert to NWR operations – number of diseases Occupational disease rate1 per hours worked (including contractors). The Committee risks, including responsibility for their 2008 2009 2010 2011 works systematically on the application own safety and the safety of their 0.50 of the health and safety measures system, co-workers. scrutinises the causes of injuries, deals 6. Cooperate with Trade Union bodies 0.40 0.42 0.43 with the specific health and safety in implementing occupational health 0.39 situation in individual units, checks the and safety tasks; at the same time, 0.30 0.30 state of workplaces and recommends jointly striving to ensure employees’ 0.20 measures to improve health and safety. In obligations under the Labour Code, addition, OKD has a Safety Commission, the Collective Agreement and safety 0 .10 whose monthly meetings are also regulations are complied with. Personal lamps of all OKD mine workers have been modernised since 2008 as well as all personal protection aids. attended by Trade Union representatives. 7. Based on the occupational health and 0 Safety inspectors are appointed at safety policy results, look for further 1 The number of occupational diseases relative to the total all mining sites and section safety possible improvements. hours worked by the total number of core employees for the reporting period times factor 200,000. Does not rate, expressed by the Lost Time Injury Most commonly, the human factor is part; no administrative proceedings were inspectors are also designated. Trade include contractors. Frequency Rate (‘LTIFR’), the Occupational to blame for work injuries (e.g. wrongly commenced against the company; no fine Union representatives also attend all OKK occupational health and safety Disease Rate (‘ODR’) and the number of assessed or underestimated risk or was imposed. health and safety checks and tests of Coking operations place considerable fatal injuries. indiscipline). Other possible causes are safety regulations; they take part in demands on plant employees and in the NWR operations – Absentee rate number of shifts lost unforeseeable risks (e.g. rock bounces). 28 June 2011 Darkov Mine, mining site 2 investigations into the causes of injuries past have posed a high level of risk. OKK’s 2008 2009 2010 2011 In the years 2008–2010 OKD implemented A head-on collision between an LZH and are members of compensation management therefore places exceptional 1,600 the SAFETY 2010 programme, in which the There were 5 fatal injuries in OKD mines 50 D.3 monorail locomotive and a DH commissions. emphasis on ensuring occupational safety 1,599 overall cost exceeded EUR 20 million. Under in 2011: 100 D.0 track locomotive. At the time and the observation of safety principles in 1,280 the programme the latest protective work of the collision no cars were coupled all internal operations3. The cooperation 1,208 1,238 gear was bought; today this gear is used by 2 April 2011 Karviná Mine, ČSA mining site to the suspended locomotive; the track 960 1,167 at the level of occupational health and all employees in surface and underground Along with the driver, the employee in locomotive was pulling 30 large-capacity safety area is also stated in Collective 640 workplaces. In addition, the investment in question was transferring approx. 50 belt cars full of coal. After the collision Agreement. modern mining technologies bought under rollers and 3 packs of chains from a JDV the driver’s cabin of the suspended 320 the POP 2010 programme has helped push 1,25 mining car to a TDS 4500 transport locomotive was badly deformed; the track NWR KARBONIA occupational health down the LTIFR in recent years. container suspended on ZD 24 cars. locomotive was almost undamaged. The 0 and safety During the lifting, the mining car tipped HBZS doctor on the scene stated that the NWR KARBONIA did not have any LTIFR continues to attain increasingly and came to rest against the container. driver of the suspended locomotive had continuous operation in 2011. A detailed favourable scores since 2008. Between The employee in question stepped into suffered fatal injuries. Indirectly linked health and safety policy was under 2008 and 2011 there was a pronounced the tipped car to move a small packet of to this administrative proceedings were 1 You can find more information about the preparation and is planned to be fall of almost 37 per cent in the number chains into the container by hand. As soon commenced; the proceedings ended Committee in the Sustainable Development implemented in 2012. of recorded work injuries. For the sake as he had stepped into it the car started with a fine of EUR 12,000 being imposed Governance chapter on page 22. 2 Detailed information on OKD health and safety of completeness we report also on NWR to move, pushed the container to one side on OKD for a technical state of the policy and principles are available at http:// The emphasis placed on occupational operations LTIFR only on contractors and pressed the employee against the side locomotives (speedometer defect). www.okd.cz/en/safety/ health and safety is borne out by a which reached 5.78, and were therefore of the container with its edge (the side 3 Detailed infomation on OKK health and safety is available at http://www.koksovny.cz/en/ number of safety indicators the Company lower than the overall value for NWR further from the container). No breach of where-we-produce-coke/work-safety monitors. These are principally the injury operations in 2011. safety regulations was found on OKD’s 48 49

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI LA7 ≥ GRI DMA SO Emergency preparedness Safety HBZS – the mining ≥ GRI SO1 rescue service

12 July 2011 Karviná Mine, OKD’s mining rescue service HBZS is an ČSA mining site essential part of our mining business. A rock bounce measuring 7.4 × 105 J in the HBZS’s legal status and tasks are defined area of operational longwall no. 14036. Two by the Mining Act1, by the Decree of the employees of the contractor organisation Czech Mining Authority on mine rescue Green Gas DPB, a.s., were injured, one services and by the Regulations approved fatally. During the investigation into by the Czech Mining Authority. the incident no breach of the safety regulations was found on OKD’s part; no HBZS’s key tasks are: administrative proceedings have been » Rescue human lives and property in commenced against the company; no fine the event of incidents, including the was imposed. administration of first aid underground » Accidents suppression 14 July 2011 Karviná Mine, » Elimination of the consequences of Lazy mining site accidents. A rock bounce measuring 8,3 × 106 J in the area of operational longwall no. HBZS’s additional tasks are: 14070. 13 employees were injured, one » Carry out other activities in fatally. During the investigation into the non-breathable or harmful atmosphere extraordinary incident no breach of the and other specialised and hazardous safety regulations was found on OKD’s works, e.g. at heights, above depth part; no administrative proceedings have or under water level been commenced against the company; » Cooperates with organisations in the no fine was imposed. field of accident prevention and ensures the occupational safety and health The access to transport cages is arranged in two floors. HBZS modern headquarters is situated in Ostrava-Radvanice. 4 October 2011 Karviná Mine, protection in operations and primarily in

Lazy mining site Key safety indicators for NWR operations1 in 2011 the field of carrying out spot checks on During the building of face no. 61 103 worksites and inspection of equipment Indicator Calculation method Unit 2011 value in seam 461 Max at block no. 1, a sudden designed for suppression of accidents fall of rock measuring 0.5 × 0.8 × 2.0 m Lost time injury LTIFR Number of injuries leading to incapacity 7.64 and/or personnel frequency rate for work lasting at least 3 days per from the right section of the ceiling hit the million hours worked » Fulfils tasks and duties in accordance employee in question, who was standing with special legal regulations applicable Occupational GRI2 Number of cases of occupational 0.41 behind the shovel of an MR 340 tunnelling disease rate (‘ODR’) disease per hours worked times for mine rescue service. machine. During the investigation into the factor 200,000 extraordinary incident no breach of the Absentee rate (‘AR’) GRI3 Number of shifts missed due to 1,237.7 Other activities carried out by HBZS safety regulations was found on OKD’s absence per planned number of hours include: part; no administrative proceedings have worked times factor 200,000 » Business undertaking in the field of been commenced against the company; waste management 1 NWR operations comprise the companies that performed regular extraction and production operations in 2011, no fine was imposed. i.e. OKD (including HBZS) and OKK. » Operation of technological facilities for 2 The number of occupational diseases relative to the total hours worked by the total number of core employees production of the certified products for the reporting period times factor 200,000. Does not include contractors. All fatal injuries in NWR Group are 3 An employee absent from work because of incapacity of any kind, not just as the result of work-related injury from ash matter or disease. Permitted leave absences such as holidays, study, maternity/paternity, and compassionate leave are investigated by a commission of experts excluded. » Repairs, inspections, filling and from the District Mining Authority in pressure tests of extinguishers Ostrava, the management of the mine » Operation, servicing, maintenance and in question, the NWR Group subsidiary rental service of mine lamps, charging and Trade Unions in collaboration with equipment, self-rescue devices, the police. detection and indication instruments » Operation of the centralised lamp room 2 of OKD, etc. 1 Act No. 44/1988, on the Protection and Exploitation of Mineral Wealth (Mining Act), HBZS employed 34 professional rescue as amended. 2 More information in English is available in workers as of the end of 2011. HBZS Annual Report which can be downloaded at http://www.hbzs-ov.cz/ke-stazeni/ 50 51

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HBZS – the mining rescue service

Case study Case study A further 30 films with live actors The system is designed as M1 category intervals of 40 m) to the existing system Films and animation to improve safety highlight potential errors that can Knowing where miners are in a mine equipment, which means equipment will and by modifying the tag in the miner’s at work endanger miners’ health at work. In the increases safety function if the methane concentration lamp battery (not requiring a change of interactive training sessions the films limit (1.5 per cent) is exceeded or if there lamp). The worker in the mine is notified Employees’ safety comes first for are paused and the viewers are asked As part of the drive to improve safety is an electricity blackout. All data are of incoming messages by the flashing of NWR. The Company is also aware of to identify the dangerous and risky during coal extraction in geologically backed up and can be retrieved at any his miner’s lamp or an LED diode on the the importance of the training process behaviour and to explain what the correct active areas the Czech Mining Authority time. battery. A button will be installed on the for improving safety during work procedure is in terms of compliance with came up with a demand for technical battery to confirm receipt of the message underground. The principal objective safety regulations. equipment that can automatically 12 systems were deployed in NWR mines or to send back a predefined message. is to use a dynamic and interesting monitor when workers enter a designated in 2011 and are gradually moved from method to enhance employees’ sense Last but not least, 25 short films with area. discontinued faces to new faces. The control centre will thus be able to of responsibility for their own and their live actors draw attention to needlessly warn every worker of a possible danger colleagues’ health. risky behaviour that may put miners’ The solution NWR developed in A system for communication with central and/or tell him to leave the area. Workers health at risk. cooperation with a system supplier control is being prepared as another step in the mine will be able to warn about In this context the Company, in makes it possible to keep track of the to improve safety when shock-prone a critical situation or send a rescue conjunction with an external supplier, The films and clips are not only used exact number of miners in a given area, seams are being worked on. This will add request. The equipment will also allow made a series of short films, clips and for occupational safety training in the to pre-define a maximum permissible new possibilities to the existing system. for the relatively precise localisation of animation in 2011 to draw employees’ central training facilities the Company number of miners and to sound a warning The principal requirement is to ensure a worker in a mine. attention to possible risks, hazardous founded at Darkov Mine for the Karviná signal when this number is exceeded basic communication between the worker situations or risky and wrong behaviour part of the mining district and at Paskov or when someone enters the area at a in the mine and central control. It is The basic development of this equipment when working underground. The training Mine for the Frýdek part. They are also prohibited time. an upgrade on the previous system for has been completed and trial operation process thus reacts to the dynamic screened continuously on LCD screens monitoring the movement of workers in of the pager multi-cable and the development in audio-visual teaching suspended in corridors in the vicinity If there is a rock bounce the technology working face areas with a third-degree relevant software in the mine will take methods and seeks to supply the of entrance areas and places where can be used to check whether all the shock risk. place during the first half of 2012. Trial necessary information on occupational large numbers of employees regularly workers have left the affected area or operation of the equipment will follow. safety in an attractive, graphic form that gather at the start and end of shifts. pinpoint the exact location they are in. In 2011 the supplier presented a solution After the trial operation has been will attract employees’ attention. The composition of the series of clips that makes two-way communication assessed, a decision on further use can screened is changed every week. The The system developed with an external possible by the addition of a multi-cable be made after September 2012. The work went on throughout 2011 and the issue of taking responsibility for one’s contractor (ZAM servis, s.r.o.) in 2010 (fitted with miniature transceivers at upshot is more than 120 visual materials own health and work safety is thus has been deployed at all longwall panels Members of mining teams usually remain friends on the surface, too. dealing with safety. These materials constantly with the miners whenever they classified as a third-degree shock can basically be divided into four areas. are in the mine complex. NWR applies risk since 2011. This allows for safer Twenty training films are devoted to the latest educational methods. It is well extraction of shock-prone seams. coal mining, from general information to aware that the way in which employees specific aspects of work below ground are familiarised with occupational A UHF tag located in the lower part of in terms of compliance with the safety safety is a major factor in determining the miner’s lamp and powered by the rules. These films also draw attention to the extent to which they take on board lamp battery transmits the miner’s hazardous situations that may occur in the rules and principles of occupational identity and location. The tag carries a work below ground (shocks, cave-ins, gas safety. The goal remains the same: for unique number and detailed information leaks, accidents) and the correct way to everyone to return home to their families about the holder. The tag has a backup prevent and respond to them. safe and sound. source in case the main battery runs down. In the monitored roadways there Fifty animated shorts depict a character are readers that track the movement called Francek the Miner breaking various of people and save the information to safety regulations and paying the ultimate a database. Inspection service staff price for his negligence. The short films can continuously track the movement are designed to make an emotional of specific individuals, monitor their connection to employees and draw their numbers in shifts and are notified if they attention to compliance with the various enter a prohibited zone. Mine rescue team must always be prepared to aspects of occupational safety. emergencies. 52 53

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI LA10 ≥ GRI LA11 Continuous Improvement Employee training Programme and education

NWR places great emphasis on its Group employees undergo training on Qualification management and lifelong learning programmes OKD HBZS OKK employees’ own initiatives, ideas and various subjects several times a year. Internal training courses Yes Yes Yes creativity. That is why in 2009 OKD As the chart below shows, the NWR announced for employees of mines, coking operations average number of training Funding support for external training or education Yes No Yes plants and the companies supplying them hours converted per employee has Provision of sabbatical periods with guaranteed return to employment Yes No Yes the Continuous Improvement motivation increased to 21.8 training hours in 2011. Pre-retirement planning for intended retirees No No Yes programme, the aim of which is to Retraining for those intending to continue working Yes No No encourage the submission of innovative Various kinds of training are organised ideas and suggestions. The programme for employees, from induction training, Severance pay over and above the legal requirement Yes Yes Yes was rolled out in OKK a year later (2010). qualification and re-qualification If severance pay is provided, does it take into account the employee’s Yes Yes Yes The CIP programme has clearly set rules, training, specialist training (in PC skills, age and years of service? an evaluation and remuneration system. languages), to management training Job placement services No No Yes1 The level of the reward for the innovator (e.g. soft skills). The important aspect is Assistance (e.g. training, counselling) on transitioning No No Yes1 is directly linked to the level of the saving ‘periodical training’, e.g. in regular training to a non-working life the proposal has brought to the Company. in accordance with safety regulations. Nevertheless the CIP does not only save 1 Job placement services and further assistance were provided by OKK during the closure of Jan Šverma Coking Plant in 2009 in cooperation with regional Labour authorities. the firm money, it also improves safety. To improve employee training, a new, modern OKD Central Training Centre was All those submitting suggestions had the set up on the premises of Darkov Mine NWR operations – average number Average number of hours of all types of training hours hours chance to win a special prize: a Škoda under the Safety 2010 programme. The of training hours per employee per employee in 2011 by category (OKD, OKK) Fabia car. Training Centre serves the Paskov Mine 2008 2009 2010 2011 and all of the mines in the Karviná district 25 The CIP continued in 2010 and 2011. and including contractors working for 20 The programme exemplifies co-operation OKD. In 2011, 22,653 people attended 21.8 between the Company and its employees: training in the Central Training Centre 18.6 Škoda Fabia car for a winner in CIP programme. 15 employees’ engage with the Company of whom 17,663 were employees and and there are benefits for all parties. 4,990 contractors. 10 12.4 A significant new element in 2011 was 5 the possibility to submit innovation Work in NWR Group’s operations requires 4.6 suggestions in four languages – Slovak, specific education and skills. If an 0 Polish and English as well as Czech. employee is made redundant, the NWR Group companies seek to make sure Senior management 20.4 Since its inception, 1,463 improvement such an employee has the best possible Middle management 13.0 suggestions have been submitted, bringing conditions for finding a new job. For that Workers 30.9 savings of almost EUR 32 million. reason the Group provides a number of lifelong learning courses and qualification Education structure of NWR Group per cent management programmes in its principal employees in 2011 number Improvement suggestions in the CIP of suggestions operations. 2009 2010 2011 800

640 652 672 480

320

160 139 0 University degree 5.7% NB: Number of improvement suggestions in OKD and OKK. High School, secondary school 12.7% Apprenticeship + leaving exam 10.1% Apprenticeship 60.6% Primary School 10.9% New World Resources Sustainability Report 2011

NWR operations – total amount NWR operations – area of completed thousand m3 NWR operations – NO emissions tonnes NWR operations – CO emissions tonnes ha NWR operations – waste generation tonnes of water discharged x reclamation projects Environment 2008 2009 2010 2011 2008 2009 2010 20112 2008 2009 2010 20112 2008 2009 2010 2011 2008 2009 2010 2011 15,000 550 850 150 70,000 545 833 146.8 12,000 440 680 120 56,000 64,043

9,000 330 510 90 111.4 42,000 376 46,145

Area of completed reclamation in 2011 13,930.22 509 42,222 42,282 12,708.66

6,000 11,765.67 220 340 60 75.7 28,000

11,078.66 249 3,000 110 189 170 270 30 14,000 171 34.3 0 0 0 0 0

Highlights Total amount of waste has fallen by 28 per cent over the past 4 years

NOx emissions down by 65 per cent year-on-year Total area of reclamation completed since 1993 has reached 1678 ha EUR 7 million spent on reclamation projects in 2011 Total energy consumption and sales1 down by 9 per cent year-on-year

1 Sales (deductible) of coke-oven gas and carboniferous natural gas. 2 Estimate – data will be audited in September 2012. The reported values differ from those in the Integrated Pollution Register, because quantities are only stated in the IPR if they exceed the legally defined threshold.

Photo: Narrow-clawed crayfish (Astacus leptodactylus) lives in large populations in flotation tailings ponds of OKD Mines. 56 57

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≥ GRI DMA EN ≥ GRI DMA EN Biodiversity Biodiversity ≥ GRI DMA EN ≥ GRI EN14 Compliance ≥ GRI DMA EN Strategy Transport Reclamation and ≥ GRI DMA EN Overall ≥ GRI MM1 ≥ GRI EN28 ≥ GRI EN30 biodiversity conservation

NWR’s business, be it deep-level hard-coal Reclamation Legislative framework in the Czech NWR operations – area of completed reclamation ha mining or coke production, has a real Reclamation is a process to rehabilitate Republic projects impact on the environment. The Group the biological functions of the countryside The legislative framework is laid down 2008 2009 2010 2011 150 operates in the Moravian-Silesian Region and restore an affected area according to by Act no. 44/1988, on the Protection 146.8 of the Czech Republic and in Upper Silesia natural principles and the requirements and Exploitation of Mineral Wealth 120 in Poland, both areas with long-standing of the public authorities and the local (‘Mining Act’). The Mining Act requires 111.4 industrial tradition. Both regions, home communities. a comprehensive approach to tackling 90 to around 6.5 million people in total, have the consequences of mining. The Mining 60 75.7 a number of ecological black spots as Setting reclamation targets is a process Act consists of two main parts: a result of two hundred years of heavy comprising various steps, from drawing 30 industry. For that reason both the local up the concept to planning a specific 1. Reclamation work. 34.3 communities and the state supervisory reclamation project that undergoes zoning 2. Mining damage and preventive 0 authorities in the region pay great and subsequently building permission measures (see the Community chapter attention to environmental protection, proceedings, in which it is compared with page 97). NWR operations – area of completed ha which is an important issue for the public. the relevant towns’ and municipalities’ reclamation projects The total size of the area we own and use zoning plans and is elaborated to meet Amendment of the Mining Act adopted in for our business was 1,580 hectares as of the conditions of the environmental and 19931 requires every extraction company 31 December 2011 and the total size of the zoning authorities. in the Czech Republic to create a financial area impacted by our business was 8,400 reserve for rehabilitation and reclamation hectares. Monitoring the impact of the Deep-level mining causes subsidence, of land affected by mining and for mining Group’s activities on the environment is even sinkholes, in the existing terrain, damage. The Mining Act also defines how one of the fundamental principles of NWR’s i.e. a partial deformation of the this reserve is to be created and how it is sustainable development and makes it landscape’s topography by changes to the to be drawn down for the given year. possible to mitigate as many negative altitude of the affected site. Part of the impacts as possible. area’s surface often ends up below Reclamation plans and implementation Reclamation project Husova (16 ha); reclamation landscaping in years 1987–2003; biological reclamation in years 1998–2009. Darkov Mine in the background. the groundwater level. processes When we communicate with stakeholders, Projects that are on going and under the most frequently mentioned Regarding emissions it should be noted administration. Reclamation projects NWR’s reclamation process does not just preparation are detailed on the map of Agricultural areas 751.05 ha environmental problems are waste that NWR and, in particular, OKK comply are executed with maximum concern for create a new landscape in the form of reclamations on pages 60–61. Forest areas 588.49 ha generation, wastewater, air pollution with all the limits set by the Czech the future needs of the community and forests, water surfaces and watercourses Aquatic areas 64.47 ha caused by emissions, and energy legislation. Emissions targets, and the conserving the landscape and biodiversity. and agricultural land; it also results in OKD draws up the Comprehensive Other areas 273.90 ha consumption. Other issues mentioned scorecard results achieved (see Scorecard areas designed for recreation and sport. Rehabilitation and Reclamation Plan NB: State as at 31 December 2011. include past damage to the landscape pages 14–15), show that NWR Group The Group’s energy savings and Reclamation only really got going in (‘CRRP’) for a 5-year period. The CRRP plan caused by extraction and industrial is committed to constant in emissions reduced emissions are mainly driven the Moravian-Silesian Region in the last is updated every year and, when approved production. That is why the Group pays volumes. by modernisation programmes2 and 15 years. by the zoning division of the Ministry of attention to and invests in these particular investments improving the energy the Environment, it is presented to the areas and measures the impacts of its Emissions from transporting products efficiency of production. Direct NWR’s long-term reclamation goal is to District Mining Authority. activities. Two keys elements of the to customers have been reduced by the environmental protection costs and reduce the number of reclaimed areas by strategy are continuing reclamation work decision to distribute the greater part of investments in 2011 amounted to almost 2015. There are currently 87 reclamation Once it is approved2, the budget, which and reducing emissions. output by rail. EUR 7 million for reclamation; EUR 555,000 projects that have been drawn up or are is covered by a financial reserve for was spent on settling mining damages under preparation (see the maps on pages rehabilitation and reclamation, is OKK, our coking business, complies with associated with the phasing-out of activity; 60–61); coordinating this work is highly allocated for individual reclamation the air pollution emissions limits and and EUR 5.8 million went settling other demanding in technical and organisational projects, and is then submitted to the wastewater discharge limits prescribed in mining damages. terms. The aim is therefore to concentrate District Mining Authority for approval. the integrated licence1 pursuant to Article reclamation activities into 1–2 large Once approved by the District Mining 1 All documentation, including decisions on 13 (3) of Act no. 76/2002, on Integrated The sanctions imposed for water pollution projects in the long-term outlook. Under Authority, project implementation starts. integrated licences, is publicly accessible Prevention. and emissions did not exceed the amount these two projects, waste rock will be 1 in the IPPC (Integrated Pollution Prevention and of EUR 36,600 in 2011, which is another laid down until 2030 and the areas will Under the CRRP we plan to complete Amendments to Acts Nos. 168/1993 and Control) information system at www.mzp.cz/ippc 169/1993, amending and adding to Acts Nos. 2 See POP 2010 at When deciding about reclamation work aspect illustrating our endeavour to gradually undergo rehabilitation. reclamation projects covering an area of 44/1988 and 61/1988. http://www.newworldresources.eu/en/ and the future use of reclaimed areas, comply with all the legislation. 28.6 hectares in 20123. 2 The exact procedure of these proceedings is operations/active-mines/optimisation-programme all the related issues are discussed with described in Act No. 61/1988, on mining activity, and COP 2010 at explosives and the state mining administration, http://www.newworldresources.eu/en/ stakeholders, in this case primarily the as amended. operations/coking-plant/optimisation-programme community and the state and municipal 3 See the Scorecard chapter on pages 14–15. 58 59

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≥ GRI EN14 ≥ GRI MM1 Reclamation and biodiversity conservation

Case study of biological reclamation the landscaped The adjoining area of the old Doubrava Dinosaurs in a mining village terrain was grassed over and new trees waste dump and the remnants of the old were planted to replace the unsuitable red slag-heap, with small marshy ponds, The mining village of Doubrava in the and unhealthy trees. give the Dinopark’s backdrop a truly Karvinsko district used to contain a waste prehistoric feel. The park was opened dump of the Doubrava mine, which In 2008 there was a change of plan in July 2009 and straightaway became has already been discontinued. It is an when the new owner of the land, a destination that attracted visitors interesting fact that almost 112 million RPG RE Property, was contacted by a firm from the Moravian-Silesian Region and tonnes of coal was extracted from that proposed building an attractive beyond, including the neighbouring areas Doubrava Mine between 1868 and 2006. leisure complex there for the population of Poland and Slovakia. The remaining reserves are now extracted of the Karvinsko district and the region via an underground connection from the as a whole. Biological reclamation was The Dinopark complex has around ČSA Mining Site of the Karviná Mine. completed on the vast majority of the seventy life-size models of prehistoric site in 2009 and the land was let for animals that emit noises and move; Thanks to the reclamation efforts of the purpose of building the Dinopark. it also has a 3D cinema, a children’s OKD and an interesting business plan The total reclamation cost was in excess paleontological playground, a museum drawn up by a separate private company, of EUR 256,000. of real artefacts, a gift-shop and the site of the original mine’s waste a Mesozoic-styled restaurant. It is dump is now one of the biggest tourist Biological reclamation is now continuing a perfect example of how the combined attractions in the Moravian-Silesian on the part of the site along the road from efforts of mining companies, landowners, Region – a dinosaur park that will be Orlová to Doubrava, which is scheduled entrepreneurs and communities in areas enjoyed mainly by families. Along with to finish in 2012. One aspect of this is the affected by the legacy of coal mining can Ostrava zoo and the mining museum at five-year care for newly planted trees, lead to positive outcomes for everyone Golf Resort Lipiny was built in the middle of nowhere previously affected by mining activities. Ostrava-Petřkovice, the Dinopark is in including the removal of invasive knotweed concerned. the top three of the most popular tourist and hogweed. Every reclamation project comprises of Major reclamation projects The DINOPARK5 project is similarly destinations in the region. In 2010, for two main phases: One major, new-generation project is successful. After reclamation of an area example, the first year the Dinopark was Golf Resort Lipiny4 (reclamation area of called Macurůvka (151 ha), a dinosaur fully open, it had over 158,000 visitors. Armoured dinosaur Edmontonia in the Dinopark. » reclamation landscaping, with the 51 hectares), which is expected to open park was opened to the public in 2009. Preliminary estimates show that the extent depending on the scale of the in spring 2012. The project is important Since then it has attracted around number of visitors in 2011 exceeded damage done to the area by mining primarily owing to the high level of local 180,000 visitors every year. 200,000. (removing damaged and non-indigenous community participation in the flora, stripping away the upper soil decision-making about the form the Reclamation projects covering an area of The area beside the waste dump at strata, remodelling the terrain using reclaimed area should take. It successfully 111.4 hectares were completed in 2011. Doubrava was originally intended to waste rock, re-routing utility lines, documents NWR’s efforts to involve In total, since 1993, OKD has rehabilitated serve as an additional area for dumping draining the area and re-laying new the local community in reclamation more than 1,600 hectares6 of land. waste rock, a by-product of extraction. soil); and projects so that the outcome not only That was no longer needed when the » biological reclamation (sowing grass, complies with the technical and biological Doubrava Mine was discontinued, and planting trees and shrubs and tending requirements but also dovetails with re-cultivation work began. The first phase them). social interests, i.e. the demands of the consisted of the thorough clean-up and local population. subsequent landscaping of the area, which was then re-covered with a layer of earth. As the area had not been used for a long time, it had become a site for 4 For more information about the golf course visit www.golflipiny.cz illegal refuse tipping and wind-seeded 5 For more information about the golf course visit trees had begun to grow there. Technical www.golflipiny.cz reclamation throughout all 15 hectares 6 A list of selected reclamation projects, including specifications, can be found in the of the future park site was commenced publication ‘Returning Life to the Region’, in autumn 2007. The original goal was which can be downloaded from http://www. to create a public green space. As part newworldresources.eu/en/sustainability/our- environment/reclamation 60 61

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Map of reclamations – state as at The total size of the area impacted by our business Karviná area 31 December 2011 Paskov area Land owned, co-owned or under management and affected by NWR operations (ha) Czech Republic Poland Poland Name OKD OKK NWR KARBONIA Total Area of territory/land the organisation owns 1,505.20 28.09 46.21 1,579.50 Area of territory/land the organisation owns or leases or has under management for 8,400.001 0.00 0.00 8,400.00 production activities or extraction and are affected by mining (‘0 isoline’) Czech Republic 1 Of the area of land affected by NWR operations OKD owns or co-owns 1,172 ha.

Breakdown of reclamation work by NWR Group in 2011

Name Total area of affected territory needing reclamation (A) 3,187.06 ha Total area of territory with completed reclamation (B) (see map – completed reclamation) 1,677.91 ha Germany Slovakia Austria Total area of territory with on-going reclamation projects in 2011 (C) (see map – on-going reclamation) 769.58 ha Area of territory affected and as yet not reclaimed/rehabilitated (see map – reclamation under preparation) 739.57 ha

Karviná area Paskov area

Completed projects Completed projects Projects in implementation Projects in implementation Projects under preparation Projects under preparation 62 63

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Biodiversity conservation The documentation comprises a 2. Continuation of OKD Mining Activity, Karviná Mine, mining site ČSA Landscape and biodiversity conservation comprehensive assessment of impacts Karviná Mine, in the mining area Geographical location State Czech Republic is one of the areas defined very on the environment, on the health of the of the ČSA mining site, in 2011–2016 precisely by the applicable legislation. population, on biodiversity and on affected (code MZP201) Region Moravian-Silesian The legislative requirements are set out protected areas. As part of EIA, comments 3. Continuation of OKD Mining Activity, Municipalities Karviná, Doubrava, Dětmarovice, Orlová 8 by Act No. 114/1992, on the protection of raised by public authorities, municipalities, Lazy Mine , in 2011–2015 (code MZP167) Cadastral territories Karviná-Doly, Staré Město u Karviné, Karviná-Město, Darkov, Doubrava u Orlové, Koukolná, nature and the countryside, as amended, non-profit organisations, individuals and 4. Continuation of Mining Activity, Orlová, Poruba u Orlové, Horní Lutyně and Act No. 100/2001, on environmental other affected parties during the process ČSM Mine, in 2009–2020 (code MZP157) Below-surface / Karviná Mines I 16.623588 km2 impact assessment, which implement are considered and dealt with. 5. Continuation of OKD Mining Activity, underground areas Doubrava u Orlové 9.537211 km2 the EU directives. Paskov Mine, in 2011–2020 (mining areas) The EIA process is completed by the final (code MZP180) Adjoins a protected The operation sites do not contain or impinge on any especially protected natural territory within the meaning of Article Both acts require regular contact with decision issued by Ministry of Environment. area / contains part 14 of Act No. 114/1992, as amended, or any natural parks and are not directly contiguous with any ‘Sites of Community the state supervisory authorities and, The decision specifies requirements OKK of a protected area Importance’ (‘SCI’) within the meaning of Articles 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, entered in the applicable National List of SCIs or demarcated areas of birdlife pursuant to Article 45e of especially during environmental impact for the company and is a guarantee for The decision to modernise the coking this Act. There are no registered ‘significant landscape elements’ pursuant to Article 6 of Act No. 114/1992, as amended, assessment, with local government, stakeholders that biodiversity in the battery nos. 8 and 10 was made before Act in the territory. There are only ‘significant landscape elements’ within the meaning of Article 4 of Act No. 114/1992, on citizens and non-profit organisations. given territory will not be compromised. No. 100/2001 took effect, so no EIA study the protection of nature, as amended (hereinafter ‘statutory SLEs’) (e.g. subsidence lakes and fens). In compliance with Article 45i (2) of Act No. 114/1992, as amended, an assessment of impacts on the NATURA 2000 system was not All NWR’s valid decisions in the Czech was drawn up. required (the nature protection authority issued an opinion ruling out such impacts). A list of protected trees (17 in total) Before any mine construction and Republic, including the comments of pursuant to Article 46 of Act No. 114/1992, can be found in the relevant EIA documentation1. extraction can start in a new area or participants in the proceedings and the NWR KARBONIA Type of operation Extraction continue in existing areas, two fundamental final decisions, are publicly available online Final decision of EIA process for Dębieńsko documents are drawn up and submitted: at the EIA Information System mine was granted by Polish authorities. Biodiversity value Attribute – www.cenia.cz/eia. Protected status – 1. EIA documentation; and The following tables contain basic 1 EIA documentation: Continuation of OKD Mining Activity, Karviná Mine, in the mining area of the ČSA mining site, in 2011–2016 (code MZP201), 7 2. Opening, Preparation and Extraction Plan . List of valid decisions from EIA processes information about the protection of in 2011–2016, http://www.cenia.cz/eia concerning NWR operations: important components of biodiversity in 7 See Article 32 of Act No. 44/1988, on the the areas of NWR Group’s mines, sorted protection and exploitation of mineral wealth OKD according to mines. Detailed information (Mining Act) and Article 10 of Act No. 61/1988, on mining activity, explosives and the state 1. Continuation of OKD Mining Activity, for each area can be found in the EIA Karviná Mine, mining site Lazy mining administration; for more on Opening, Darkov Mine, in 2011–2020 documentation. Geographical location State Czech Republic Preparation and Extraction Plan see the (code MZP195) Community chapter on page 97. Region Moravian-Silesian 8 Lazy Mine became part of Karviná Mine as mining site Lazy on 1 April 2008. Municipalities Karviná, Orlová Cadastral territories Karviná-Doly, Lazy u Orlové, Orlová Darkov Mine Below-surface / Lazy 6.067 km2 Geographical location State Czech Republic underground areas (mining areas) Region Moravian-Silesian Adjoins a protected The operation sites do not contain or impinge on any especially protected natural territory within the meaning of Article Municipalities Albrechtice, Horní Suchá, Karviná, Stonava area / contains part 14 of Act No. 114/1992, as amended, or any natural parks and are not directly contiguous with any ‘Sites of Community Cadastral territories Albrechtice u Českého Těšína, Horní Suchá, Darkov, Karviná-Doly, Karviná-město, Ráj, Stonava of a protected area Importance’ (‘SCI’) within the meaning of Articles 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, entered in the applicable National List of SCIs or demarcated areas of birdlife pursuant to Article 45e of Below-surface / Karviná Mines II 9.34599 km2 this Act. There are no registered SLEs in the territory. There are only statutory SLEs here (forests, watercourses, water underground areas meadows). In compliance with Article 45i (2) of Act No. 114/1992, as amended, an assessment of impacts on the NATURA Darkov 5.08383 km2 (mining areas) 2000 system was not required (the nature protection authority issued an opinion ruling out such impacts). There are no Stonava 11.507524 km2 protected trees pursuant to Article 46 of Act No. 114/1992 in the territory (see the EIA documentation1). Adjoins a protected The operation sites do not contain or impinge on any especially protected natural territory within the meaning of Article Type of operation Extraction area / contains part 14 of Act No. 114/1992, as amended, or any natural parks and are not directly contiguous with any ‘Sites of Community Biodiversity value Attribute – of a protected area Importance’ (‘SCI’) within the meaning of Article 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, entered in the applicable National List of SCIs or demarcated areas of birdlife pursuant to Article 45e of this Protected status – Act. The NATURA 2000 territory is not directly affected e.g. by subsidence or subsequent reclamation works. SCIs and 1 areas of birdlife located in the less immediate vicinity are named in the relevant EIA documentation . 1 EIA documentation: Continuation of OKD Mining Activity, Lazy Mine, in 2011–2015 (code MZP167), http://www.cenia.cz/eia Type of operation Extraction Biodiversity value Attribute – Protected status –

1 EIA documentation: Continuation of OKD Mining Activity, Darkov Mine, in 2011–2020 (code MZP195), http://www.cenia.cz/eia 64 65

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ČSM Mine Frenštát mothballed mine Frenštát mine was built in the years 1981 Geographical location State Czech Republic to 1994. In 1994 it was mothballed; that Region Moravian-Silesian state lasted until 31 December 2003, when Municipalities Albrechtice, Chotěbuz, Karviná, Stonava the Czech Mining Authority prolonged this status indefinitely. Frenštát mine was Cadastral territories Karviná-Doly, Darkov, Albrechtice u Českého Těšína, Podobora, Louky nad Olší, Ráj, Stonava never put into operation. Below-surface / Louky nad Olší 22.1 km2 underground areas (mining areas) More information about the Frenštát Mine can be found Adjoins a protected The operation sites do not contain or impinge on any especially protected natural territory within the meaning of Article area / contains part 14 of Act No. 114/1992, as amended, or any natural parks and are not directly contiguous with any ‘Sites of Community at www.dulfrenstat.cz of a protected area Importance’ (‘SCI’) within the meaning of Articles 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, entered in the applicable National List of SCIs or demarcated areas of birdlife pursuant to Article 45e of As the administrator of the Trojanovice this Act. There are no registered ‘significant landscape elements’ pursuant to Article 6 of Act No. 114/1992, as amended, mining area, OKD therefore keeps the in the territory. There are only statutory SLEs here (marsh and aquatic biotopes of the Mlýnky watercourse and Mlýnské rybníky fishponds). In compliance with Article 45i (2) of Act No. 114/1992, as amended, an assessment of impacts on the Frenštát-Trojanovice coal seam mothballed NATURA 2000 system was not required (the nature protection authority issued an opinion ruling out such impacts). A list on the basis of this decision. The Mining 1 of protected trees (3 in total) pursuant to Article 46 of Act No. 114/1992 can be found in the relevant EIA documentation . Act requires OKD to ensure that the seam Type of operation Extraction is not degraded. OKD’s principal activities Biodiversity value Attribute – here are mine water pumping, ventilation and necessary repairs, which cost the firm Protected status – around EUR 2.44 million per annum. More 1 EIA documentation: Continuation of Mining Activity, ČSM Mine, in 2009–2020 (MZP157), http://www.cenia.cz/eia detailed information about the overall coal reserves and geological conditions is needed before a decision can be made about the future of the Frenštát-Trojanovice Frenštát mothballed mine. seam. For that reason OKD is planning to Paskov Mine explore this mine and then draw up EIA Geographical location State Czech Republic documentation. Region Moravian-Silesian Municipalities Brušperk, Fryčovice, Frýdek-Místek, Hukvaldy, Krmelín, Palkovice, Paskov, Staříč, Sviadnov, Žabeň Cadastral territories Brušperk, Fryčovice, Frýdek, Lysůvky, Lískovec u Frýdku-Místku, Chlebovice, Rychaltice, Krmelín, Palkovice, Paskov, Staříč, Sviadnov, Žabeň Frenštát mothballed mine Below-surface / Staříč 42.512486 km2 Geographical location State Czech Republic underground areas Region Moravian-Silesian (mining areas) Cadastral territories Trojanovice, Kunčice pod Ondřejníkem, Frenštát pod Radhoštěm, Čeladná, Pstruží, Rožnov pod Adjoins a protected The operation site contains an especially protected natural area within the meaning of the categories pursuant to Radhoštěm, Kozlovice, Tichá na Moravě, Bordovice, Veřovice and Lhotka area / contains part Article 14 of Act No. 114/1992, as amended, specifically the Kamenná natural monument (area 2.83 ha, registered in of a protected area 1990), where an enclave of subxerophyte grasses on the site of former lime quarries in the Staříč cadastral territory is Below-surface / Trojanovice 63.17 km2 protected. The operation site does not contain or impinge on national parks. underground areas There are statutory SLEs in the territory (forests, watercourses, fishponds and valley water meadows). The park by (mining areas) the chateau (treatment centre) in Paskov is a registered SLE within the meaning of Article 6 of Act No. 114/1992, as 2 amended, but that is not affected by mining. The mining area is in close proximity to three Natura 2000 SCI areas within Mine fields Frenštát-west 33.97 km the meaning of Articles 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, as amended Frenštát-east 29.20 km2 (CZ0813464 Pilíky, CZ0813462 řeka Ostravice, CZ0813463 Paskov (chateau park)). However, these areas are not expected to be affected by mining, because they are not situated in areas expected to become wetland or in areas to be used for Adjoins a protected The inactive Frenštát mine is located in an especially protected area, specifically the Beskydy protected countryside surface activities linked to coal mining in this mining area. There are protected trees (6 in total) pursuant to Article 46 of area / contains part area1 within the meaning of the categories pursuant to Article 14 of Act No. 114/1992, as amended. Habitat of European Act No. 114/1992 (see the EIA documentation1) in the territory. of a protected area Importance CZ0724089 Beskydy (‘SCI’) within the meaning of Articles 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, as amended, and inscribed on the National List of SCIs is located in the territory of the Type of operation Extraction Trojanovice mining area. There is also birdlife area CZ0811022 Beskydy here pursuant to Article 45e of this Act. Biodiversity value Attribute Terrestrial Type of operation Extraction Inactive (mothballed) Protected status Natural heritage site pursuant to Article 14 of Act No. 114/1992, Natura 2000 system within Biodiversity value Attribute – the meaning of Articles 45a to 45c of Act No. 114/2004, on the protection of nature and the countryside, as amended. Protected status Protected countryside area

1 EIA documentation: MZP180 Continuation of OKD Mining Activity, Paskov Mine, in 2011–2020, http://www.cenia.cz/eia 1 You can find more information about the Beskydy protected countryside area at www.beskydy.ochranaprirody.cz 66 67

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Emissions of NOx, SO2, CO, PAH, and every year since 2008. The total reduction Direct and indirect greenhouse gas The source of indirect CO2 emissions NWR operations – NOx, SO2, CO emissions tonnes particulate matter in the last four years has been 65 per cent. emissions is energy bought from suppliers and 2008 2009 2010 20111 NWR strives to minimise emissions of Emissions of particulate matter totalled The total quantity of CO emissions generated from fossil fuels, primarily 900 2 greenhouse gases and to improve energy 189 tonnes in 2011. discharged by NWR Group operations was electricity, the energy required to make

efficiency. As a leading Central European 720 833 672,698 tonnes in 2011. compressed air, heating energy and steam. producer of thermal and coking coal Fly-ash management as practised by the The total quantity of indirect CO2 emissions 550

operating in a region with a significant OKD subsidiary HBZS is very important In NWR’s case the source of direct CO2 generated by NWR’s operations in 2011

545 industrial tradition, the Company is aware for influencing air quality. HBZS uses ash 509 emissions is mainly the Svoboda Coking was 537,097 tonnes. 380

of emissions’ impact on the population’s matter produced by heating-plant and Plant; other sources included in the 376

quality of life and health. power-plant sources outside NWR (e.g. ČEZ 170 calculation are natural-gas heating and There was a year-on-year fall of 25 per cent

270 249

and Dalkia) primarily as a technological 189 combustion of engine diesel and petrol. in total direct CO emissions produced 172

171 2

140 115 0 108 Based on data in the Integrated Pollution raw material for filling excavated spaces The total quantity of direct CO2 emissions by OKK to a level of 127,012 tonnes 1 Register of the Czech Republic (‘IPR’) , in deep-level mines. Using ash in mines NOx emissions generated by NWR’s operations in 2011 (2010: 170,256 tonnes). This reduction NWR Group and its subsidiary OKK are, for safety purposes brings many positive was 135,601 tonnes. was achieved by concentrating production SO2 emissions according to the current Czech legislation, effects. Sluicing ash from the surface into CO emissions major sources of air pollution in the mine areas has a long tradition and is an 1 Estimates – the data will be audited in September 2012. Energy consumption (indirect and direct) Moravian-Silesian Region only as regards integral part of the coal extraction process NB: The reported values may differ from the IRP data, and calculation of the annual CO2 (tonnes, 2011) Unit OKD HBZS OKK Total GJ CO2 (tonnes) emissions of certain substances technology in OKD with a significant as quantities are only given in the IRP if they exceed the legally defined threshold. Electricity (including electricity for making MWh 793,951.0 440.9 43,072.7 837,464.6 3,014,872.5 401,118.0 (e.g. NO , CO , particulate matter (‘PM’) safety benefit. The fly ash is processed x 2 compressed air) and poly-aromatic hydrocarbons (‘PAH’)). by HBZS to produce a certified ‘HBZS Heat GJ 916,067.0 0.0 25,541.0 941,608.0 941,608.0 99,057.2 The data on NWR Group emissions in this Stowing Mixture’, a certified stabiliser Report are more precise than those in and filling mixture. The filling mixture is NWR operations – PAH emissions tonnes Steam GJ 0.0 0.0 350,967.0 350,967.0 350,967.0 36,921.7 the IPR, as emissions of a given substance used for safety measures2 in mines. The 2008 2009 2010 20111 Total indirect energy consumption 4,307,447.5 are only reported in the IPR if they exceed stabiliser is mainly used in surface areas 0.300 Total indirect CO emissions 537,096.9 the legally defined threshold. for rehabilitation and reclamation projects 2 3 and as filling material when mine works 0.240 Natural gas thousand m 0.0 224.4 0.0 224.4 8,753.5 436.2 0.245 The main source of air pollution is are being demolished. 0.230 Petrol litres 107,448.0 3,971.0 862.7 112,281.7 3,708.1 263.9 0.180 therefore OKK’s production of coke and 0.196 Diesel litres 3,647,343.0 20,322.0 72,162.1 3,739,827.1 136,353.0 7,891.0 coking by-products. In 2011 the firm cut its Emissions from the transport of products 0.120 0.134 Total direct energy consumption 148,814.6 SO2 emissions by 37 per cent and NOx by to customers are reduced to a minimum Direct CO emissions from OKK coking plant 127,010.0 50 per cent. The target for 2012 is to because 98 per cent of our products are 0.600 2 achieve further reductions to the level of transported by rail. Total direct CO emissions 135,601.1 0.000 2 280 tonnes for NOx and 77 tonnes for SO2. Resulting annual CO2 mass flow for 2011 672,698.0 Emissions-related fines 1 Estimates – the data will be audited in September 2012. NB: The reported values may differ from the IRP data, Emissions of particulate matter are In 2011 OKD was fined EUR 4,066 for as quantities are only given in the IRP if they exceed the legally defined threshold. Method for calculating emission factors and annual CO mass flow1 monitored in OKD on the basis of the possible air pollution caused by 2 capacities of the upcast ventilating shafts non-compliance with an inspection Energy/energy raw material Unit Average CO2 emission factor, its value and method at in individual mines (mine ventilation). of the tightness of a seal of cooling Electricity MWh 0.478967097 tonnes CO2/MWh (0.8388 tonnes CO2/MWh × 0.571 – ČEZ coal-fired The volume of particulate matter equipment. OKK was fined EUR 30,500 by power stations accounting for 57.1 per cent of electricity generation in 2011) NWR operations – CO2 emissions (2011) tonnes emissions in OKD is therefore constant the Czech Environmental Inspectorate for GJ 0.133046416 tonnes CO2/GJ (0.233 tonnes CO2/GJ × 0.571 – ČEZ coal-fired power over time. It is also hard to influence if operating apparatus in contravention of stations accounting for 57.1 per cent of electricity generation in 2011) occupational safety and good working the integrated licence – a technical fault Heat GJ 0.1052 tonnes CO2/GJ Dalkia heat source in 2011 (out of this firm’s total heat conditions are to be maintained for the caused by unidentified reasons in a sealing consumption from different sources (2,102,782 GJ/year) in 2011) miners. OKK has successfully reduced its pipe made it necessary to shut down the Steam GJ 0.1052 tonnes CO2/GJ Dalkia heat source in 2011 (out of this firm’s total heat quantities of particular matter emissions sealing of a chemicals operation for a time. consumption from different sources (2,102,782 GJ/year) in 2011)

3 3 Natural gas thousand m 1.944 tonnes CO2/1,000 m of natural gas (from an average natural gas composition of 990 m3 CH in 1,000 m3) 1 See www.irz.cz (Czech only), or European 4

Pollutant Release and Transfer Register Petrol litres 2.35 ± 0.3 kg CO2/l calculated from the composition of 95 octane automobile petrol (E-PRTR) http://prtr.ec.europa.eu (in English). 2 Diesel litres 2.11 ± 0.3 kg CO /l calculated from the composition of engine diesel Construction of dams for explosion-proof 2 sealing of mine works; filling empty spaces to Direct CO2 emissions from OKK coking plant tonnes calculation method pursuant to Decree No. 12/2009, defining the procedure reduce mining’s impact on the surface; sluicing for ascertaining, reporting and checking quantities of greenhouse gas emissions excavated cave-in spaces to prevent or subdue Indirect 537,097 t coal fires. Direct 135,601 t 1 The method for calculating emission factors and the annual mass flow is based on the recommendations of the Prague Institute of Chemical Technology, 2012. 68 69

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at the Svoboda Coking Plant, closing down the Jan Šverma Coking Plant and Case study completing the COP 2010 investment Ostrava need not involve burning coal programme under which a new battery Coke-oven gas helps heat households in and thus worsening the air quality. At no. 10 was built and battery no. 8 was Ostrava during poor pollution dispersal the moment when other large industrial modernised. The investment cost of conditions concerns have to restrict operations, COP 2010 was EUR 63 million. technically pure coke-oven gas Coking can be simply defined as stripping becomes the source of heat for Ostrava Degassing coal of its volatile constituents. Few households. Mine degassing is the removal of people know that these substances make potentially explosive hydrocarbon gases up 20–30 per cent of the total weight of Planned shutdowns of technological and (mainly methane) known as carboniferous coal as the primary raw material used in distribution facilities coke-oven gas, natural gas3 that are contained in the coal the coking process. These substances including facilities designed to protect seam from mines to the surface using are then processed in the chemical air quality, are minimised during these pipes. Mine degassing in all OKD mines is treatment part of the coking plant and periods. based on the suction principle, performed are put to use in other industrial sectors by surface degassing stations fitted with or in agriculture. Under a Declaration of Understanding in special pumps (water jet pumps). Mine the Field of Air Quality Protection in the degassing is done to increase safety in Coke-oven gas is the most important Moravian-Silesian Region signed by OKK mine workplaces. by-product of coking. After it is separated and the Moravian-Silesian Region, all from the coal, this gas is purified to the measures required by the Regulatory The only contractual buyer of remove ammonium, benzol, hydrogen Rules for the Regulation signal are put degasification gas is Green Gas DPB a.s., sulphide and other fractions. Technically into effect even when only the Alert which uses it for commercial purposes, pure coke-oven gas is mainly used to heat notice has been issued. mainly heat generation or electricity the plant’s own coking batteries, but any Unusual view of the ČSM Mine. generation. The drop in the amount of remaining gas is used in heating plants. In the early days of coke production it carboniferous natural gas from mine In the case of OKK’s coking plant this is was standard for the volatile substances the neighbouring plant of Dalkia Česká degassing between 2008 and 2009 is 3 to be released into the atmosphere. Production of carboniferous natural gas from mine degassing CH4 (million m /year) caused partly by the phasing-out of the republika, a.s., which uses coke-oven gas The chemical by-products only began Extracted by degassing Industrial use Dukla mining site and partly by the impact to supply heat to households in Ostrava. to be used for further processing at of the economic crisis. 2008 68.809 68.523 the turn of the 19th and 20th century. 2009 56.957 56.838 What is crucial to the life of people Of course, in those days there were no in Ostrava when pollution dispersal strict regulations governing production’s 2010 62.509 62.373 conditions deteriorate is that burning impact on the environment. 2011 57.218 57.092 technically pure coke-oven gas is not harmful to the environment. At NB: the difference between extracted gas and industrially used gas (known as ‘degassing blow-off’) is not significant Few people are aware that technically from the point of view of environmental impact. OKK’s coking plant coke-oven gas is pure coke-oven gas, known as coal gas, desulphurised to a level below 50 mg of was the first gas that people started hydrogen sulphide per cubic metre. That using for lighting and heating. In the is ten times lower than required by the former Czechoslovakia it was not until Czech legislation. More than 50 per cent the 1980s that coal gas was replaced in of pure coke-oven gas is hydrogen, which all households by natural gas. is converted into water vapour during combustion.

When an Alert or Regulation notice is issued according to the Regulatory Rules for Smog Situations approved by the Czech Environmental Inspectorate, the priority is then to supply technically pure 3 Carboniferous natural gas contains 92.5 coke-oven gas to the heating plant so per cent methane, 2.25 per cent higher that delivering heat to the population of Technology in Svoboda Coking Plant in OKK hydrocarbons and 6.3 per cent ‘inerts’ (mainly ranks among the most modern in the world. nitrogen and carbon dioxide). 70 71

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The last 10 years have brought continuous Energy consumption by source 1 improvements in the efficiency of electricity Direct energy consumption involves the NWR operations – energy consumption and sales GJ Case study consumption, and today consumption has use of primary sources of energy; indirect 2010 2011 been reduced to the minimum required to energy consumption comprises the energy 6,000,000 ČSM Mine preserve the volumes of coal extraction and required, for example, to generate the 4,800,000 coke production. Any greater savings would used electricity, heat etc. Indirect energy 4,921,604 In response to rising prices, new necessarily impact on coal extraction and consumption is much more significant 3,600,000 4,456,262 economy measures were adopted and coke production volumes. in NWR’s case, especially since it sold off existing ones were stepped up at ČSM the subsidiary NWR Energy, a.s. in 2009. 2,400,000 Mine in 2011. The opted-for procedure, Electricity costs are a significant part whereby the cost of operating individual 1,200,000 of overall operating costs, which is why Energy savings and related initiatives pieces of machinery was calculated to the Group has long focused on cutting There was a year-on-year fall in energy 0 give an idea of the cost of compressed consumption and increasing the energy consumption by 9.46 per cent (465,342 GJ), air consumption, proved effective. Since 1 Sales (deductible) of coke-oven gas and carboniferous efficiency of its plant and machinery. At the without factoring in sales of generated natural gas. June last year, measures to reduce same time, managing energy consumption coke-oven gas and captured carboniferous compressed air consumption were is important in terms of indirect emissions, natural gas. When sales of generated launched at the mining site South of including greenhouse gases. coke-oven gas and captured carboniferous the ČSM Mine. This mainly involved Sales of coke – oven gas and carboniferous natural gas GJ natural gas are factored in, the switching from apparatus using As a result of integrating coke production year-on-year fall in energy consumption 2010 2011 compressed air to apparatus running 6,000,000 at one coking plant and the drive to was 34.2 per cent (365,500 GJ). The cause on electricity. This in itself is a major source of energy cost savings. As achieve savings, energy consumption of the saving is mainly the 3 per cent 4,800,000 expressed in GJ has fallen from more than increase in sales of coke-oven gas expected, installing automatic control 4,900,000 in 2010 to less than 4,500,000 (i.e. sales to Dalkia Česká republika, a.s.) 3,600,000 of pneumatic units for pumping water in 2011 (not including sold coke-oven gas in 2011 (59,170 GJ) compared to 2010. 3,650,123 3,567,445 also brought savings. In this case the 2,400,000 and carboniferous natural gas). Energy return on the purchase cost was very The winding machine drum. rapid. And it means savings of almost consumption in the Group thus fell by Further reductions in energy consumption 1,200,000 9 per cent year-on-year. will be based on plans to optimise the EUR 162,000 per month. costs of individual operations’ – mines 0 Direct energy consumption Nevertheless, despite the reduction in and the coking plants – energy Direct energy consumption involves the Longwall-shields supports and electrical overall energy consumption the quest consumption and on evaluation of the use of primary sources of energy: in NWR’s engine of the conveyor belt in the ČSM Mine. for savings is one of the key tasks of the return on investments in energy savings. case this means non-renewable sources Group’s energy specialists. Under the CIP1 Energy savings fall within the authority NWR operations – total energy consumption1 GJ of fuels derived from oil (petrol and diesel) programme, employees also contribute of individual subsidiaries and the and natural gas. their own ideas for improvements to this responsible units. 2010 2011 6,000,000 endeavour (case study: ČSM Mine). One Direct energy consumption accounts for advantage of suggestions raised by the Investments in new technologies under 4,800,000 just 3.3 per cent (148,814 GJ) of NWR’s workforce is that they are often low-cost the PERSPective 2015 programme are total energy consumption (without solutions that can be put into practice also part of the energy savings plan. 3,600,000 deducting sales of coke-oven gas and immediately. Employees’ initiatives leading to concrete carboniferous natural gas) and is mainly 2,400,000 savings play a very important role (see the linked to vehicle operation and heating. In previous years, specifically since the CIP on page 52). Energy savings in NWR 1,200,000 POP 2010 and COP 2010 investment stem from process changes, technological 1,271,481 Coke-oven gas is the main by-product 888,817 programmes were rolled out in 2008, the improvements and employees’ initiatives. 0 of coking. In NWR Group the producer of Company has invested massively in new 1 Including sales (deductible) of coke-oven gas and coke-oven gas is OKK. After purification development and longwall equipment and carboniferous natural gas. it is used to heat coking batteries and in the construction of a new coking battery any surplus amounts are delivered to the and repairs to existing ones. A number neighbouring heating plant operated by of these initiatives led to energy savings. Dalkia Česká republika, a.s. From there it Nevertheless, the energy efficiency heads into households in the form of heat. factor is and will remain a key criterion in For more information see the case study investment decisions. ‘Coke-oven gas helps heat households in Ostrava during poor pollution dispersal 1 See the Our people chapter on page 52. conditions’. 72 73

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NWR Group energy consumption in 2011 GJ Indirect energy consumption by primary energy source Unit 2010 2011 Case study Electricity GJ 2,463,323 2,572,580 An example from the ČSA mining site of into the process water network at the Compressed air GJ 468,256 442,293 Electricity savings at the Karviná Mine: Karviná Mine demonstrates that even a preparation plant by another QVC Heat GJ 1,083,863 941,608 as simple as re-routing pipes and turning simple idea can cut an operation’s energy pump with a 100 kW motor that works off a pump Steam GJ 767,794 350,967 consumption and costs. Thanks to this around-the-clock. The engineer idea, the subsidiary OKD will save almost suggested connecting the pipe that Total GJ 4,783,236 4,307,448 NWR realises that employee motivation EUR 40,700 per year in reduced electricity carries water from Doubrava 4 directly is the key to increasing efficiency, saving consumption. The simple yet ingenious idea to the distribution network at the energy and, above all, further improving put forward by technical engineer at the preparation plant and turning off the Direct source of energy generated1 Unit 2010 2011 work safety. This is why it launched local preparation plant Dušan Zmijka was QVC pump. The floating pumping station Coal (thermal) GJ 135,976,958 153,772,060 the CIP in 2009 as a way of rewarding given the project name Shutdown of the would provide the necessary pressure. Coke-oven gas GJ 1,974,784 2,033,954 sensible improvements suggested by its service water pump. workforce. Putting employees’ ideas into Indirect energy consumption 4,307,448 GJ Carboniferous natural gas GJ 1,675,339 1,533,491 Naturally, in the winter months, when practice saves the Company hundreds What is the basis of his suggestion? there is a risk of the system freezing, Direct energy consumption 148,815 GJ Total GJ 139,627,081 157,339,505 of EUR millions a year. The programme The coal preparation process uses large everything will operate as before. Even NB: Total energy consumption does not include sales gained the trust of the workforce, 1 The difference between generated and sold direct energy sources comprises inventories of coal, which generally of coke-oven gas and carboniferous natural gas. quantities of water. In the case of the so, the QVC pump is expected to be hover around ± 5 per cent. raised their interest in goings-on in the ČSA mining site, additional process water left idle for at least seven months a workplace, and showed that it would is drawn from the Doubrava 4 reservoir year, resulting in electricity savings Indirect energy consumption be to everyone’s benefit if they thought equipped with a floating pumping station. worth roughly EUR 40,000. There is Direct source of energy purchased Unit 2010 2011 Indirect energy consumption accounts for about their work and looked for ways to The pumping station works around-the- nothing preventing it being switched the vast majority of energy consumption Petrol GJ 2,785 3,708 make it safer, more efficient and less clock, pumping water into a process water off for longer, to be turned on only when in NWR, almost 97 per cent in fact. In this Diesel GJ 126,163 136,353 physically demanding. pool. From there the water is pumped sub-zero temperatures are forecast. context it is important to mention that Gas GJ 9,420 8,754 indirect energy consumption fell by Technical engineer Dušan Zmijka in the preparation plant of ČSA mining site. 11 per cent between 2010 and 2011 Total GJ 138,368 148,815 thanks to the reduced consumption of compressed air, steam and heat. 1 Electricity consumption increased slightly Direct source of energy sold Unit 2010 2011 year-on-year. The fall in the consumption Coal (thermal) GJ 142,426,466 152,096,334 of compressed air and simultaneous Coke-oven gas GJ 1,974,784 2,033,954 slight increase in electricity consumption Carboniferous natural gas GJ 1,675,339 1,533,491 is mainly the result of switching some Popisek fotky technologies previously using compressed Total GJ 146,076,589 155,663,779 air to electricity. This step brings cost 1 The difference between generated and sold direct energy sources comprises inventories of coal, which generally savings, greater efficiency (lower losses) hover around ± 5 per cent. and a reduction in indirect emissions. 74 75

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Within NWR Group it is mainly the coal Total water consumption and water discharge in NWR operations (thousand m3) preparation and washing process that 2008 2009 2010 2011 necessitates the use of large quantities of water. As part of its mining operations the Total water consumption (total process water + wastewater from other 30,563 30,110 36,062 25,344 organisations + drinking) Company is therefore seeking to maximise its use of recycled water (see the Recycled Of which Water section), which amounted to 38 per cent Surface water, including water from wetlands, rivers and lakes 18,912 17,844 18,945 15,246 in 2011. 2011 brought a year-on-year fall in (1st quality process water) water consumption by 30 per cent. Recycled Recycled water (2nd quality process water) 10,631 11,422 16,228 9,152 water use increased by 14 per cent Groundwater 0 0 0 0 from 2008 to 2011. In 2012 the Group plans to exceed a figure of 50 per cent on the Rainwater collected directly and stored by a reporting organisation 0 0 0 0 condition of stable climatic conditions. Wastewater from other organisations 95 48 28 30 The reusable water cycle is continuously Consumption from communal water supply or other water-supply service 924 796 860 992 enhanced by investments in reusable water (Drinking water) supply conduits, but it also depends on Total water discharge (public water mains, wastewater including mine 12,709 13,930 11,776 11,079 climatic conditions, above all the amount water, extra treatment) of precipitation in the given year. Of which Total quantity of discharged water not requiring treatment 474 372 434 250 Water consumption before discharge into the water mains NWR’s goal is to consume water in the Total quantity of treated sewerage before discharge 0.92 0.52 1.86 2.51 most efficient way and prevent negative impacts on the quality of surface water Quantity of water discharged into the public water mains via the sludge 5,833 7,703 5,734 4,926 bed system (charged) in the region the Group operates in. Its business complies with all the EU Of which Lakes created in subsidence basins around mines are suitable for many natural habitats. and Czech legislative requirements for Total quantity of treated sewerage before discharge 2,083 1,882 1,659 0 water quality and regular measuring is Total quantity of treated mine water before discharge into the water mains 5,736 5,279 4,932 5,369 performed. Water sources impacted by water nerby where this water is treated), consumption b) Špluchov – water from the River Olše Total quantity of water sent to the Ostrava Central Wastewater Treatment 665 576 663 468 Plant for extra treatment As a result of our water-saving activities, Overall water consumption in NWR is (after it is taken from here the water one of the key aspects of our impact on divided between OKD and OKK, with is merely filtered and transported to Total quantity of wastewater discharged into the public sewers 0 0 0 62 the environment, in 2011 we achieved 93 per cent falling to OKD. For this reason treatment plants by pipeline). a year-on-year fall of 28 per cent in water the report concentrates on OKD in the Total quantity of recycled and reused water (calculated from 10,631 11,422 16,228 9,152 consumption – to 14.3 million m3/year. matter of water sources substantially The source of process water in the total 1st and 2nd quality process water) Total water consumption can be divided impacted by water consumption. Paskov part of OKD is the River Olešná, Percentage share of recycled and reused water (per cent) 35.99% 39.03% 46.14% 37.51% into three categories, the biggest being from where water is channelled into the surface water for operating purposes, In the Karviná area of OKD the source of Kuboň I, II and III process water detention which accounts for 93 per cent of total process water1 is surface water, which is reservoirs. From there it is pumped into consumption. A lesser share is taken by drawn mainly from the Těrlická přehrada the process water distribution network drinking water and wastewater from other reservoir. Below the dam there is the (used in surface operations such as extra water into the system in the Chlebovice Chlorides are contained in discharged mine organisations (namely the operations of Těrlicko pumping station, which pumps water for coal preparation, for cooling and area and partially also to the Kamenná water (brine). The quantity of chlorides third-party firms located in the Group’s water into the Kostelecké nádrže detention as fire extinguishing water). The Paskov reservoir. is reported to the Integrated Pollution premises and discharging wastewater reservoirs. From there the water flows Mine area and Staříč mining site of the Register every year. No limits are set for through NWR Group). downhill through the 50km pipeline system Paskov Mine area are supplied from the OKD discharges surplus treated water these chlorides, however, as it is a natural called the Těrlicko conduit to all the mines River Olešná. From the Kuboň detention from the froth-flotation tailings pond substance that does not impact on the in the Karviná area of OKD (Darkov Mine, reservoirs water is pumped into two other as wastewater into watercourses environment in the quantities discharged. Karviná Mine and ČSM Mine). Kamenná detention reservoirs. administered by the Odra Basin Authority (discharge for a fee). OKK gets water from the River Odra via the Technological water is supplemented with Another source of process water for BorsodChem MCHZ pumping station and other surface sources, i.e. watercourses. the Chlebovice area of the Paskov Mine The Integrated Pollution Register lists two discharges rainwater and cooling water Water is taken from the following pumping is untreated surface water from the areas: (a) Karviná Mine, ČSA mining site via Fiebig outlet into the River Ostravice in 1 Water from surface sources used for technological purposes (e.g. coal preparation stations on the River Olše: a) Sovinec Košice reservoir. Below the dam there is and (b) Karviná Mine, Lazy mining site as quantities complying with the limits stated plants) and to make bathing water. (there is also a water treatment plant a pumping station that supplies process sources of chlorides in discharged water. in the integrated licence. 76 77

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Recycled water Within the NWR Group only OKD currently Case study uses recycled water. plants. This assists flocculation of fine OKD manages to recycle two fifths of its particles of refuse, resulting in faster Recycled water means water that is process water settling and water treatment. re-treated in a system of flotation tailings ponds. This recycled water is then OKD discharges several types of water Usually, there are at least three flotation pumped by a pumping station situated into the environment and the water tailings ponds filled cyclically with mine in the last flotation tailings pond of the it uses is also supplied from various wastewater. Water flows from the first system for re-use in coal preparation, for sources. To supply untreated surface tank into the next one via an overflow, example. water for technological processes, the pumping or filtration. The same process firm constructed a pumping station is used between the second and the OKD constantly strives to reduce its water downstream of the Těrlická přehrada third tanks that contain water already consumption. As coal extraction and dam, including a delivery pipeline treated to second-degree purity. Recycled preparation are impossible without water connecting the detention reservoirs. water from the last tank is pumped by however, the only feasible means is to All mines in the Karviná district use water the return-water pumping station to the increase the proportion of reused water. supplied from Kostelec reservoirs. Kuboň preparation plant and may be reused for Water recycling is therefore one of OKD’s Reservoir I, II and III, fed with water from coal washing. There are financial as well environmental priorities. Expressed as the River Olešná, are used for the Paskov as environmental reasons to do this: the a percentage, the volume of recycled water Mine. Process water is used either recycled process water does not have to in OKD’s operations has already reached untreated in coal preparation plants for be paid for. And, as the company recycles almost 40 per cent. sluicing fly ash into the mine, or may as much of this water as possible, the be used, after pre-treatment in water environment is being protected. 2010 was an exceptional year for the treatment plants, as service water for volume of recycled water. That was down bathing and for air conditioning in mines. Unneeded water treated in the system of Darkovské moře (‘Darkov Sea’) should be in the future used for sports and leisure activities. to the very large use of surface water due flotation tailings ponds is discharged, for to local floods. Any use of this floodwater All OKD mines are equipped with coal a fee, into nearby streams as wastewater. is measured as consumed water, as this levels in the flotation tailings ponds and small grains from the washed coal, which preparation plants where raw coal goes water also occurred in recycled water prevented larger-scale use of recycled then settle more quickly, leaving the water through a sophisticated refinement reservoirs. water. purified of soil particles. process before it is loaded for delivery to consumers. Water is an important 2011 brought a combination of several All OKD mines are equipped with coal Fines for discharged water component used for coal washing, for Water areas close to OKD mines. phenomena that influenced the quantity preparation plants. After use, magnetic In 2011 OKD (Pila Salma plant) was fined coal sorting in the preparation process, of recycled water. First, there was separators are used to purify the water of EUR 2,033 for discharging wastewater for separation of fine and coarse a logical year-on-year decline against the magnetite, which is used in heavy-liquid that was not in accordance with fractions, for separation of the finest backdrop of the exceptional year 2010, in suspensions that separate coal and waste Act No. 254/2001, on waters. Remedial coal particles from waste rock in cyclone other words a return to the original state rock. From there, the water then is either measures were initiated as soon as separators, or in sloughing-off tanks or of recycled water use. Second, at the pumped back into the preparation process this was detected. At the start of 2012 sludge presses. After use, some of the ČSM Mine there was a change in the coal or to the system of flotation tailings wastewater discharging was taking place water is treated in magnetic separators preparation technology, which resulted ponds, as required. in line with new decision no. 1284/11/VH to recover the magnetite that is used in lower supplies of recycled water. In of the Ostrava City Hall, Environment in heavy-liquid suspension to separate addition, preparation of thermal coal Every mine is equipped with a system of Division, ref. no. SMO/419114/11/OŢP/15 coarse-coal particles from waste rock. started at ČSM Mine in 2011. Preparation flotation tailings ponds in which flotation of 4 January 2012. Then the water is either returned, if of thermal coal requires less water than tailings settles. A ‘flocculation agent’2 is needed, to the coal preparation plant or coking coal. 2011 was also a year of added to the water from the preparation is dumped in sludge tanks near the mine. scarce rainfall, which led to low water plants; this encourages the clustering of Each mine is equipped with a set of settling tanks or flotation tailings ponds where the settling of flotation tailings take place. A ‘flocculation agent’ is added to the water leaving the preparation 2 A flotation agent causes coal to float, a flocculation agent causes particles to stick together, become haevier, and sink. 78 79

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI DMA EN ≥ GRI MM3 Emissions, effluents ≥ GRI EN22 and waste ≥ GRI EN23 ≥ GRI EN22 Waste ≥ GRI MM3

NWR Group’s operations are associated Total production of waste rock NWR operations – waste generation tonnes tonnes with the generation of considerable and flotation tailings Form of waste disposal (tonnes) 2008 2009 2010 2011 volumes of miscellaneous waste and, to 2008 2009 2010 2011 2008 2009 2010 2011 Total quantity of waste passed on to 34,522.20 26,395.60 26,115.20 29,682.92 70,000 8,000,000 a much lesser extent, hazardous waste. another company for use (recycling) 56,000 64,043 6,400,000 Total quantity of waste passed on to 29,520.80 15,826.40 16,166.80 16,462.08 another company for disposal 510,952

The quantity of generated waste in the 494,157 531,024 365,042 (landfilling/incineration) 42,000 4,800,000 past three years has increased from 42.2 46,145 to 46.2 thousand tonnes. A significant 42,222 42,282 Total 64,043.00 42,222.00 42,282.00 46,145.00 28,000 3,200,000 part of that is the production of scrap 4,994,993 4,866,043 4,926,678 metal (up from 22,984 to 27,191 tonnes in 14,000 1,600,000 4,798,524 the case of scrap iron and from 435 to The quantity of waste rock and flotation tailings generated (tonnes) 2008 2009 2010 2011 729 tonnes in the case of non-ferrous 0 0 Total quantity of waste rock 4,994,992 4,866,043 4,926,678 4,798,524 metals from 2010 to 2011). That was Waste rock (waste banks) the result of investments in modern Flotation tailings technologies under the POP 2010 Total quantity of flotation tailings 510,952 365,042 494,157 531,024 programme and subsequent discarding Total 5,505,944 5,231,085 5,420,835 5,329,548 of old technologies. The increased production of scrap metal does not have a negative impact on the environment, as it is reusable waste with an economic benefit for NWR Group.

hazardous substances produced when waste rock as a secondary raw material is preparation. It is a material with a particle List of old environmental damages Hazardous waste coking battery no. 9 was being overhauled. usually more advantageous economically, size of 0 to 0.5 mm and ash content Svoboda Coking Plant 156.3 tonnes of contaminants in groundwater There was a substantial increase in the Part of the hazardous waste production not to mention the reduced consumption (non-combustible solid components) production of hazardous waste in 2011 comes from tar-contaminated earth or of non-renewable natural resources. greater than 60 per cent. It is created 246.8 tonnes of contaminants in earth as a result of efforts made to deal with oil substances and sludge containing oil The effect on the landscape is also when coal sludge is separated by flotation 113,367 tonnes of contaminated structures environmental damage – on real estate derivatives. This sludge was removed from significant – the number of new quarries based on the different physical and ČSA Coking Plant 294.2 tonnes of contaminants in earth owned by OKD – caused by a third party. the Jan Šverma Coking Plant, which was and borrow pits1 is reduced. chemical properties of the surfaces of 105,962 tonnes of contaminated structures At waste rock dump D at Řepiště shut down in 2010. the particles being separated. Flotation an illegal discharge of an unidentified In the Moravian-Silesian Region there are tailings are stored in flotation tailings Lazy Coking Plant 75,969 tonnes of contaminated earth quantity of petroleum substances and Waste disposal waterworks, sludge tanks and water dams, ponds, to where they are transported Jan Šverma Coking Plant 150,000 m3 of contaminated earth subsequent contamination of the soil All waste generated in the Group’s measuring tens of kilometres in length, by pumping the water-ash mixture. 136,000 m3 of contaminated groundwater was discovered. The case was dealt with operations is either passed on to another that were built using materials from waste 3 in cooperation with the police and the company for further use or is disposed of. rock. Therefore, the use of waste rock is Number and volume of significant 133,710 m of contaminated structures Czech Environmental Inspectorate. Waste that can be reused is first recycled. also important from the point of view of contaminations Trojice Coking Plant 130,000 tonnes of contaminated earth As the culprit was not found and there This includes iron, non-ferrous scrap flood protection. Waste rock is a certified No significant contamination 2,600 tonnes of contaminated structures was a risk of groundwater contamination, metal, oils, separated plastics, paper etc. material currently used as a building of the environment occurred in NWR’s Jan Šverma Coking Plant 45,000 m3 of chemical waste (chemical waste landfill) the earth was dug up and removed by an The Company passes on non-reusable material for roads, for landscaping and operations in 2011. 3 authorised contractor at the cost of OKD, waste for disposal. This includes the was also used in the construction of the Černý příkop 38,100 m of contaminated riverbed sediment Paskov Mine. The possibility of re-billing majority of hazardous waste and also Těrlická přehrada dam. The quality of the The only current contaminations are the cost to the public authorities is non-reusable miscellaneous waste. The waste rock produced by OKD also complies from old environmental damage currently under negotiation. Roughly waste is disposed of either by incineration with the requirements for motorway on surface areas done before the land 700 tonnes of earth was included in the (approx. 1–2 per cent of the quantity building. became owned or administered by NWR. hazardous waste category. handed over for disposal) or by landfilling. These significant contaminations in National Property Fund were of a separate amendment to the same Flotation tailings are sometimes OKK locations are dealt with according transferred, following its dissolution contract, amendment The main sources of OKK’s hazardous Waste rock and flotation tailings wrongly called sludge and thus tend to to Ecological Contract No. 131/96 on 31 December 2005, to the Ministry no. 03929-2008-452-D-0131/96/01-04 waste production in 2011 were linings The Group’s hard coal extraction activities be mistaken for coal sludge, which is concluded between OKD and the National of Finance (‘MF ČR’) in accordance dated 13 November 2008, the rights and mixed construction waste containing generate waste rock. a significant burden on the environment. Property Fund of the Czech Republic, with Czech Act no. 178/2005 Coll. and obligations under the Ecological NWR stopped generating coal sludge in which means that the cost of eliminating In July 2008 OKD, a. s. and MF ČR Contract were transferred from OKD, a. s. 1 Usually a pit located away from the building site In the past, waste rock was usually stored the 1990s and currently only produces them will be covered by the state. entered into amendment to OKK Koksovny, a. s. and from which earth is extracted for building near the mining area in the form of slag flotation tailings. Flotation tailings are Significant contaminations are found no. 03929-2008-452-D-0131/96/01-03 work when there is not enough earth to be obtained from digging trenches on the building heaps; in the present day it is used as a mixture of coal dust, water, ash, clay primarily in the locations of former in relation to the above-mentioned site; sometimes also at an excavation site. a secondary raw material. The use of or sand created during minerals coking plants. The activities of the Ecological Contract. On the basis 80 81

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI EN1 ≥ GRI PR1 ≥ GRI EN2 Materials Health and safety impacts of our products

The consumption of materials in terms The Company asses the health and safety of volume and quantity does not have assessment through the whole life cycle a significant economic, environmental for 100 per cent of our main products. or social impact.

NWR Group is a producer and supplier of raw materials. Consequently, it does not use a significant quantity of other raw materials or partially processed materials that go towards the end product. Product packaging is also insignificant for NWR Group, as the produced raw materials are not packaged – 98 per cent of output is transported loose by rail.

One important raw material for coke production in OKK, however, is coking coal, which is supplied by OKD and other firms from e.g. Poland or the USA.

Coke during loading on rail cars. Cooling towers of the Dalkia heating plant.

Unit 2008 2009 2010 2011 OKD OKK Stages of health and safety Supplies of coking coal tonnes 1,518,529 1,074,018 1,190,304 893,157 impact assessment Hard coal Coke For further reference Of which supplied by OKD tonnes 1,094,053 829,500 780,202 549,523 Development of product Yes Yes Yes Coal and Coke Catalogue1 pages 4–6, concept 10–11 R & D (certification) Yes Yes Yes Coal and Coke Catalogue1 pages 8–9, 12–13 Production Yes Yes Yes Complete health and environmental protection legislation (e.g. EIA, pages 86–87, air, water, protection legislation (see section Environment of this Report) Marketing and promotion Yes Yes Yes Group’s internal documents, see table Internal documents applied in NWR Group, pages 39–40 (e.g. Codes of Ethics, Business Integrity Policy, Provision of product information) Storage, distribution Yes Yes Yes Products on stock are not material as and supply they represent max 5 per cent of total yearly output; 98 per cent of output is transported loose by rail Use and service Yes Yes Yes The use of our products is determined by their technical specification1; service is not material for our products Disposal, reuse, Yes Yes Yes Not material for our products or recycling (raw materials)

1 Available at http://www.newworldresources.eu/en/media/download New World Resources Sustainability Report 2011

NWR Group’s CSI1 EUR million NWR Group’s total contributions EUR million OKD Foundation funding by programmes per cent

Community 2008 2009 2010 2011 2008 2009 2010 2011 10 350 For Health 47% For Joy 14% 8 280 309.04 For the Future 33% 7.88 For Europe 5% Year-on-year increase in corporate 6 6.91 7. 0 3 210 social investments1 4 140 174.27 125.00 2 3.14 70 75.48 In the year 2011. 0 0

Highlights The biggest amount spent on corporate social investments (‘CSI’)1 since 2008 OKD Foundation supported a total of 298 projects, a year-on-year increase of 56 per cent The Group’s total contributions attained a value of EUR 174 million, 39.4 per cent more than in 2010

1 NWR’s Corporate Social Investment (‘CSI’) comprises finances provided for projects in the following areas: community development (OKD Foundation); support for enterprise and job creation, health (OKD Foundation projects); culture (OKD Foundation projects); education (donations to schools, scholarships), environment (finances provided over and above the legal requirement); sport (sponsorship).

Photo: Day with OKD Foundation in Ostrava zoo. OKD Foundation supported (EUR 61,000) the reconstruction of an old pavilion and helped to launch new exposition called Small Amazon region. 84 85

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI DMA EC Indirect ≥ GRI DMA SO economic impacts Community ≥ GRI DMA SO ≥ GRI DMA SO Community Resettlement ≥ GRI DMA SO ≥ GRI DMA SO Community Resettlement Grievance ≥ GRI DMA SO mechanisms and Grievance procedures mechanisms and ≥ GRI SO1 cooperation strategy procedures ≥ GRI SO1

NWR recognises that coal mining has NWR is aware of the importance of Development projects and establishing a long-term and significant impact on cooperation with the community as a way community relations people’s lives in social and economic of maintaining society’s support for the Coal mining is a long-term process that terms. Accordingly, the Company has Company’s principal business, i.e. coal has more than two hundred years of a sense of responsibility for and makes mining and coke production. Dialogue is tradition in the Moravian-Silesian Region. a commitment to the community in the conducted at various levels and in various Consequently, cooperation with and regions it operates in. forms, enabling NWR to respond flexibly support for the community is a continuous to any concerns that members of the process that begins long before the The approach NWR adopts to all the areas community may have. first lump of coal is extracted from the in which a community may be affected ground and ends long after extraction by mining is fully compliant with the NWR operates mainly in the Moravian-Silesian in a particular locality is discontinued. applicable legislation. ‘Compensatory Region of the Czech Republic, where it Interactive communication throughout payments’1 comprise finances earmarked employs to more than 18,000 people, this process is key, and NWR places for reclamation and the remedy of mining making it by far the biggest employer in the great emphasis on this right from the damage. region. In almost every family there is at moment when it announces its plans to least one person who works, has worked or explore deposits or expand extraction In NWR’s practice, early and open will work for one of NWR’s subsidiaries. into a particular locality. Therefore, in communication before a new mine is 2011, NWR concentrated mainly on the opened, covering the related impacts and The development projects of Dębieńsko in vicinity of Frenštát pod Radhoštěm, on the benefits for the local inhabitants, goes Czerwionka-Leszczyny and Morcinek on localities of Staré Město u Karviné and further than simply complying with legal the Czech-Polish border mean that NWR’s Orlová-Výhoda and, in connection with the requirements. Above all, this concerns activities also affect on the community in Dębieńsko project, on Rybnik county in cases where the population has to be the Silesian Voivodeship in Poland. southern Poland. relocated or, conversely, where extraction is to be terminated. Since many NWR employees commute In 2011, NWR announced its intention to work from neighbouring regions (the to explore a coal deposit in the vicinity Relations with community Silesian Voivodeship in Poland and the of Frenštát pod Radhoštěm. OKD The relationship and cooperation with Žilina region in Slovakia), the Company’s communicates openly with the local the community is one of the main pillars business also affects, to a lesser extent, community about its plans and organised of the concept of social responsibility the lives of people in these regions. two meetings with representatives of local and sustainability at NWR. NWR regards towns and municipalities. It publishes an open and transparent communication and Corporate social investments (‘CSI’)2 information bulletin and website support for publicly beneficial projects as a central element of NWR’s work in (www.dulfrenstat.cz) for citizens managed by local associations and support of local communities explaining its plans. Regardless of whether organisations as an integral part of its CSI as a key indicator of the Group’s social its plan gets approved by the relevant policy. This support is mainly implemented involvement is support targeting primarily authorities or not, OKD has established through the OKD Foundation (the the social area in the form of donations a Frenštát Micro-region Support Fund to Former mining city Ostrava remained an industrial centre of the Moravian-Silesian Region. ‘Foundation’). or sponsorship, not including employee support publicly beneficial projects in benefits. this micro-region. Through this Fund, it Following the publication of the intention with every real estate owner in the has pledged to contribute a total of EUR to expand coal extraction from the affected area. A public meeting is also In 2011, NWR spent more than 1 million for the development of the local Karviná Mine below the Karviná-Staré planned for the inhabitants of the Staré 1 Compensatory payments comprise payments EUR 7.88 million on corporate social community over the coming five years. Město and Orlová-Výhoda localities, Město u Karviné. on mineral extraction, payments for a mining area, and payment on the release of land from investment, a year-on-year increase OKD is currently in intensive negotiations agricultural and forestry land funds. In addition of 150 per cent. As part of the preparations for the new with representatives of all the concerned As work on these projects progresses, compensatory payments also include costs Dębieńsko mine, in 2011 NWR KARBONIA parties. In the Orlová-Výhoda district, communication with the communities related to mining damages and the financial reserve for reclamation. Donations are primarily allocated to the held eight meetings with community a meeting with the public was held to in the development localities will continue 2 NWR’s Corporate Social Investment (‘CSI’) Foundation, municipalities and culture representatives to explain its long-term present the Company’s plans and their in 2012. Communication will be intensified comprises finances provided for projects in activities of the Group. plans in the region. It regularly publishes impacts on the locality. OKD informed up in Staré Město u Karviné and the following areas: community development (OKD Foundation); support for enterprise a half-page update in the mining weekly the public how it would proceed if there Orlová-Výhoda with a view to securing and job creation, health (OKD Foundation Sponsorship of sport, culture, education Trybuna Górnicza and plans to issue a were a conflict of interests and stressed social consent for OKD’s plans. For 2012, projects); culture (OKD Foundation projects); and the preservation of mining traditions regular newsletter from 2012. it would follow the applicable mining OKD plans to issue a regular newsletter education (donations to schools, scholarships), environment (finances provided over and above in the Moravian-Silesian Region also plays legislation to the letter. OKD categorically and to set up project websites and an the legal requirement); sport (sponsorship). a key role in community support. declared its aim to come to an agreement information hotline. 86 87

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI DMA EC Indirect ≥ GRI EC8 economic impacts ≥ GRI SO1 ≥ GRI EC8 NWR Group’s ≥ GRI SO1 community involvement

Donations NWR Group’s CSI EUR million The key vehicle of CSI is the Foundation, which contributes EUR millions every year 2008 2009 2010 2011 10 to hundreds of publicly beneficial projects run by municipalities and non-profit 8 organisations. In 2011 alone, it contributed 1.6 almost EUR 2.4 million. Every year, 6 1.7 1.1 6.3 80 per cent of the supported projects are 6.0 4 5.2 implemented in the Moravian-Silesian Region. Through its four grant programmes 2 1.5 (For Health, For Joy, For the Future and 1.6 For Europe), the Foundation contributes 0 every year to the development of Donations spiritual values, traditions, education, environmental protection, sport and Sponsorship cultural activities, and social and healthcare services. OKD channels 1 per cent of its profit before tax into the Foundation every year; other donors include NWR NV, OKK and other cooperating firms.

St Barbara Civic Association NWR Group traditionally supports St Barbara Civic Association (Občanské Miner’s orphans which OSSB takes care of. Carnival parade of OKD Foundation was part of the festival ‘Mining Festivities’ in Karviná in 2011. sdružení svatá Barbora or ‘OSSB’) founded by OKD. OSSB’s goal is to support mothers and children whose husband/father died OKD Foundation Structure of donations to municipalities in 2011 per cent NWR Group donations 2011 by area per cent Objectives funded by the OKD Foundation in 2011 while working in a mine. The number of The OKD Foundation reports its activities Number of supported Objectives total children receiving support is falling thanks using the LBG (London Benchmarking Objective projects, 2011 EUR, 2011 to enormous investments in increasing the Group, www.lbg-online.net) methodology Social services 80 728,436 safety of mining work and other steps OKD devised for corporate philanthropy and is taking in this area. There are currently corporate social responsibility. In 2011, Children and youth 45 407,368 around 80 children receiving support. the Foundation contributed a total of Culture and art 35 172,494 EUR 2.19 million to 281 projects under Leisure and amateur sport 29 100,177 Municipalities four grant programmes. 16 projects were Environment, ecology, animals 23 227,427 A large proportion of donations supported with a sum of EUR 0.89 million (EUR 2.89 million in 2011) are earmarked out of the Operative Fund and one project Health 20 117,860 for municipalities in the form of was supported out of the Development Regional development 17 219,920 contributions towards renewal and Fund with a Foundation contribution of Protection of real estate monuments 10 135,819 development, based on agreements Horní Suchá 14.14% EUR 15,600. Contributions to municipalities Education and research 5 12,647 on the protection of real estate and Orlová 55.50% for renewal and development 46% Development of non-profit sector 2 4,473 interests. Signing these agreements with Karviná 28.17% OKD Foundation 51% The Foundation was set up at the start of 2008 with a view to promoting and municipalities in whose territory extraction Stonava 2.17% Stipends 1% Human rights 1 5,734 is taking place is one of the necessary developing spiritual and humanitarian Zebrzydowice – Poland 0.01% Other 2% Other 31 166,139 preconditions for OKD to be able to carry values, the environment, education, NB: Total Group expenditure on donations in 2011 Total for year1 298 2,298,496 on its business. NB: Total Group donations to municipalities in 2011 sport and cultural activities, and the amounted to EUR 2.89 million. amounted to EUR 6.3 million. field of social and healthcare services. 1 Grant programmes (4) and Development and Operative Funds. The Foundation was established by the NWR subsidiary OKD, which is also the Foundation’s biggest donor. OKD annually donates 1 per cent of its profit before tax to the Foundation. Other donors 88 89

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI EC8 ≥ GRI EC1 ≥ GRI SO1 ≥ GRI EC8 NWR Group’s ≥ GRI SO1 community involvement

Overview of projects supported by Total for year1 the Foundation in 2011, broken down Poland by regions of the Czech Republic 298 2,298,496 Liberec Number of supported projects, 2011 5 28,029 Region total, EUR, 2011 Ústí 1 3 13,013 Hradec Králové Grant programmes (4) and Development and Operative Funds. 3 39,281

Karlovy Vary Prague 1 16,267 Pardubice Moravian-Silesian 15 103,311 7 49,101 210 1,580,017 Olomouc Central Bohemia 7 62,111 8 81,157 Plzeň Vysočina 1 10,167 10 107,983 Zlín 12 100,390

South Bohemia South Moravia 8 42,449 8 65,220 Germany Slovakia Austria

Pictures of the miner’s 2012 calendar were drawn Pictures of the miner’s 2012 calendar were drawn by children of OKD employees. by children of OKD employees. ‘OKD Foundation helps miner’s orphans and sick children’ by Jakub Adamkovič, 7 years of age. ‘Miner’ by Natálie Vašíčková, 10 years of age. include NWR Group companies and other to improve the standard of care in these a range of reasons (financial, health, etc.). 4. For Europe » Crisis Fund – enables a rapid response OKD Foundation funding by programmes EUR million cooperating firms1. The OKD Foundation facilities, the OKD Foundation seeks to help Many of the projects could not take place The purpose of the For Europe programme in the event of a natural disaster or was established under Act No. 227/1997, expand their diagnostic and therapeutic without the Foundation’s support. is to provide NGOs and municipalities with other emergency on Foundations and Endowment Funds. capacities. Another goal is to broaden work Under the programme, for example, the support when administrating applications » Operative Fund – intended to support It is governed by a managing board and its and social integration opportunities for the OKD Foundation took part in the ‘Karviná for financing out of the European Union exceptional projects that cannot be work is overseen by a supervisory board disabled and socially disadvantaged, as Summer of Culture’ project comprising structural funds. included in the current grants round for (for more information visit borne out by the Foundation’s emphasis on a number of cultural events in the Karviná timing reasons http://www.nadaceokd.cz/en). supporting sheltered and socio-therapeutic district. Thanks to financial support from For » Development Fund – targets the workshops in 2011, when it contributed Europe, the Association of Municipalities development of the non-profit sector Another of the OKD Foundation’s principal roughly EUR 366,000 towards their 3. For the Future of the Rýmařov micro-region was able goals is to support the Moravian-Silesian projects. This programme supports projects to finalise the project documentation A detailed overview of supported Region, including the preservation designed to improve the quality of the for its application for a grant from EU projects is available on the OKD of mining traditions. The financial Under this programme, for example, environment, enhance living conditions funds to build a cycle path between Foundation web site contribution to non-profit organisations the Foundation supported a project in municipalities, safeguard important Malá Morávka in the foothill of the Hrubý www.nadaceokd.cz/en and is For Health 1.02 EUR million for the elaboration and administration called ‘Volunteers Change the World’, natural and cultural sites and publicly Jeseník mountain and Slezská Harta on published in the OKD Foundation For Joy 0.32 EUR million of applications for grants from European focusing on volunteers who contribute promote the principles of sustainability. the Nízký Jeseník plateau. In this way Annual Report. For the Future 0.73 EUR million Union funds by specialist agencies is towards improving the standard of care in ‘Fitness in the Outdoors’ is one of the the Foundation is helping to enhance the For Europe 0.12 EUR million unique in the Czech context. Ever since organised social services. projects funded by the OKD Foundation overall attractiveness of the area and NB: Total finances distributed by the OKD Foundation its inception and continuing into 2011, under its For the Future programme. This develop tourism. in 2011 amounted to EUR 2,16 million (excluding Development and Operative Funds). the OKD Foundation has pursued its goals 2. For Joy involves making the municipal park in through four grant programmes: The For Joy programme targets support Skalka u Prostějova a more attractive Besides these four programmes, the OKD for culture, education, leisure activities place for the local community in order Foundation has set up three funds enabling 1. For Health and also local and mining traditions in the to improve the population’s physical it to respond, whenever necessary, to Supporting health and social care region. The target group is largely young condition and steer it towards a healthier current developments outside the period in 1 A list of the OKD Foundation’s donors is published at http://www.nadaceokd.cz/ organisations is one of the Foundation’s people and seniors who might have limited lifestyle. which the regular calls for proposals from foundation/founder-and-donors/ key priorities. Through projects designed opportunities in the supported areas for NGOs and municipalities are published. 90 91

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information

≥ GRI EC8 ≥ GRI EC8 ≥ GRI EC9 ≥ GRI EC9 NWR Group’s ≥ GRI SO1 ≥ GRI SO1 community involvement

Sponsorships and other donations year in Frýdek-Místek with thousands of NWR Group sponsorship in 2011 by field per cent Support of education EUR Sponsorship funding mainly goes towards participants. 29 smaller sports projects supporting sport, culture, education or clubs received donations and a further 2008 2009 2010 2011 160,000 and the preservation of mining traditions 11 were sponsored. The total amount that in the region. NWR Group provided in support of smaller 128,000 150,405 projects was EUR 49,000 in 2011. Culture 960,000 The NWR Group provided EUR 251,000 in Education 640,000 support of culture in 2011. In keeping with Education is a key area for the future work tradition, the most important supported of the Group and the development of its 320,000 project was the multi-genre music festival activities. The purpose of all the activities 33,205 Colours of Ostrava, one of the biggest undertaken is to make technical education 0 11,590 20,415 events of this type in the Czech Republic. more appealing to young people and to More than 160 bands from all over the support people studying mining-related Close cooperation with schools Culture 16% world perform over four days for 25,000 subjects. NWR Group is interested in OKD VŠB – Technical University Sport 74% festivalgoers. OKD has for many years recruiting employees with the right of Ostrava Education 6% been the festival’s main partner. In 2011, qualifications and technical skills – there Secondary Industrial School it contributed a sum of EUR 122,000 to is currently a shortage of these employees Police and fire service 1% in Karviná Municipalities 1% the festival. The OKD Foundation was on the Czech labour market, so they have Secondary Technical and a partner of the Colours of Ostrava without to be substituted with employees from Other 2% Services School in Karviná Barriers project that improves the festival Poland and Slovakia. NB: Total Group expenditure on sponsorship in 2011 Secondary School accessibility for disabled visitors. amounted to EUR 1.58 million. in Havířov-Šumbark NWR Group supports education in two OKK Secondary Industrial School Another important project that was basic areas: in Frýdek-Místek made possible by OKD’s support was the Mining apprenticeship returned to the Czech Republic after nearly 20 years thanks to the OKD initiative. Summer Shakespeare Festival 2011; 1. NWR Group’s direct cooperation with OKD has been the event’s main partner schools (financial and non-financial) since 2010. with OKD. There were 53 employees Ad 2. OKD Foundation’s financial support and all the major industrial firms in the 2. OKD Foundation’s financial support studying Mining and Mining Geology at the for educational projects Ostrava district contribute to it. The NWR Group also supported 19 smaller for educational projects Secondary Industrial School in Karviná. In 2011, the OKD Foundation contributed The money was spent on recuperative projects in the field of culture, either with There were in total 54 employees and a total of EUR 12,600 to 5 projects focused stays in clean-air areas for approximately donations or through sponsorship. Ad 1. NWR Group’s direct cooperation with 10 scholarship beneficiaries studying on education and research. 3,000 children from kindergartens and schools (financial and non-financial) at universities in 2011 (VŠB – Technical primary schools in Ostrava. Sport Through the OKD Academy OKD supports University of Ostrava (CZ), University of Health promotion The NWR Group has long used sponsorship secondary-school students studying Pardubice (CZ), Politechnika Śląska – The NWR Group has long time supported The largest number of projects supported activities to support sport, both mechanical engineering and electrical Gliwice (Poland), and Akademia the health of the region’s population, by the OKD Foundation in 2011 fell under professional and amateur, mainly in the engineering and university students Górniczo-Hutnicza Krakow (Poland)). either directly or through OKD Foundation the For Health programme: 116 projects Moravian-Silesian Region. A total of studying mining, geological, and electrical projects. During 2008–2011, the received a total of EUR 1.02 million. EUR 1.17 million was channelled into this engineering and related subjects. Besides In 2008, a cooperation agreement was NWR Group mainly supported healthcare area in 2011. OKD is the general partner monthly scholarships of EUR 81 for signed between OKD and the Secondary through donations, providing a total of the handball club HCB OKD Karviná secondary-school students and EUR 163 Technical and Services School in Karviná, of EUR 196,000. OKD has devoted (EUR 305,000 in 2011), the twelve-time for university students, OKD offers which led to a renaissance in the study an additional EUR 102,000 in 2008 to the champion of the Czech handball league. students specialised internships at its of mining subjects. Karviná Mining Hospital for the purchase Great attention is paid to supporting workplaces and provides consultations of modern equipment for diagnosing football. OKD sponsored the second- for seminar work, bachelor degree work In 2011, a cooperation agreement on oncological illnesses. Moreover OKD lets division football club MFK OKD Karviná and diploma work. These students are a similar basis was signed with the buildings to the private Karviná Mining with a sum of EUR 813,000 in 2011. guaranteed employment at one of OKD’s Secondary School in Havířov-Šumbark. Hospital, while simultaneously investing NWR is the partner of Ondřej Broda, the workplaces after they finish their studies. Starting in the 2011/2012 academic year, in their renovation. European 50 m fin-swimming champion. future mining electricians and mechanics As of end-2011, there were 125 students will study the same specialisations here OKK contributed EUR 81,000 to the Fund For many years, donations have been taking apprentice courses in Mechanic and with the same support from OKD. for Children at Risk of Air Pollution in 2010. provided to support the ‘Mining Ten K’, an for Mining Operations and Electrician for The Fund was set up by a 26 March 2010 international 10 km running race held every Mining Operations for later employment resolution of the Ostrava city council 92 93

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≥ GRI SO1 ≥ GRI SO1 NWR Group’s community involvement

Case study Case study The civic association is based in Prague. obtained a grant worth EUR 488,000 Leading an independent life with the help It has no link to the mining region, Thanks to OKD Foundation disabled from EU funds,’ says the charity director of the OKD Foundation but even so it regards OKD Foundation people have somewhere to live Pavel Folta. as a key partner. ‘We live from year to and work The Czech Republic is one of the year. We are dependent on grants and Thanks to OKD Foundation, the project countries with the largest proportion we never know how much money we will The complex of the former Alexander for long-term use of a listed building of children in institutional care per have for our work. But we need to have Mine at Ostrava-Kunčičky, a listed for social purposes has taken real form. population size. There are more our basic budget covered to implement heritage site, has been transformed ‘We will use the sheltered housing for than 20,000 children growing up in long-term programmes like Together One beyond recognition in recent years and clients with mental disabilities. We want institutions. After leaving an institution, Step Further. OKD Foundation is one of the OKD Foundation has played a major to integrate them into the work cycle, most of the children are unable to cope our regular supporters. The Foundation role in that transformation. Thanks to free them from dependency on state with ordinary life and more than half of has clear rules and we can depend on it,’ the work of the Charity of St. Alexander, support and make them part of society,’ them commit a crime within the next Zákora declares. a dilapidated area has become a living Folta says. three years. NWR is not indifferent to centre that helps people in distress. their fate. More than 50 disabled people have found work in sheltered workshops in the Charity of St. Alexander saved the surface One of the organisations trying to buildings of the former deep mine. The mining buildings of the former Alexander Mine improve the situation is the Letní dům former administrative building is being and rebuilt them into a sheltered workshops (Summer House) civic association. converted into sheltered accommodation for approximately 50 disabled people. Thanks to Letní dům civic association prepares children OKD Foundation support the project has taken Together One Step Further is for people with mental disabilities, and from children’s homes to an independent life. real form. a programme designed to facilitate the organisation also provides social the transition to an independent life counselling to people in need. for children from children’s homes. OKD Foundation has contributed to Ever since it was established in 2008 the this programme since 2009, providing OKD Foundation has worked with the EUR 25,800 so far (EUR 9,350 in 2011). Charity of St. Alexander, which celebrated its tenth year in 2011. Since 2008, OKD The programme is based on letting Foundation has contributed EUR 161,000 young people from children’s homes to the charity’s projects. In the past, stay in a ‘training flat’ in Prague. the OKD Foundation has towards the There the youngsters, under the guidance purchase of machines for workshops, of experienced therapists, encounter assisted in job creation for the disabled the potential pitfalls of everyday life. and supported repairs to the former They learn how to cope with basic coach-house, which is now a plastics situations such as transport, looking sorting facility. There are also former after a household, looking for work miners among the local employees. In the and being responsible with money. joinery workshop, for example, disabled The youngsters learn how to people make things we use every day, communicate when dealing with such as kitchen units, tables and chairs. practical matters involving as yet unfamiliar concepts and situations. In 2011 the Charity of St. Alexander won the OKD Foundation Award for a project They undergo six stays in the training flat to build sheltered housing for nine people in a year. The flat always houses a group and socio-therapeutic workshops in the of six young people. The programme is mine’s former administrative building. prepared by two members of staff of OKD Foundation provided EUR 20,300 Letní dům. ‘We do the stays to help young towards the project. ‘Out of that money people leaving a children’s home cope we paid for the planning, applied for as well as possible,’ says Cyril Zákora, the building permit and executed the director of Letní dům. first stage of repairs. Thanks to that we 94 95

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≥ GRI EC1 ≥ GRI SO1 ≥ GRI MM9 ≥ GRI MM6 ≥ GRI MM9 Mining activity ≥ GRI MM10 and the community

Payments to the state and municipalities Development projects and negotiations Total payments1 to the state and with the community municipalities paid by NWR Group as In 2011, there was no need to look for a whole for the last four years amounted alternative housing for the population to EUR 684 million. In 2011, the figure was of localities affected by coal extraction approximately EUR 174 million. or coke production. The development projects under preparation (Orlová-Výhoda, Payments on hard-coal extraction Staré Město u Karviné and Dębieńsko) are These payments to the state and currently in the phase of negotiations with municipalities comprise three types of the community. In total, 13 public meetings payment on hard-coal extraction: were held with the inhabitants and representatives of municipalities in 2011. 1. Payment on minerals extraction (Article 32a (2) of the Mining Act) The purchase of real estate has » 75 per cent to municipalities traditionally been carried out by the » 25 per cent to the state budget of the individual Mines which make up OKD. Czech Republic In total, 82 items of real estate (of which 2. Payment for a mining area (Article 32a (1) 34 houses with land; 40 pieces of land and of the Mining Act) 8 other items) were bought up in 2011. » 100 per cent to the affected Reclamated areas become a natural part of the landscape. OKD Chief HR and Mining District Development Officer Radim Tabášek during the public meeting with municipalities NWR KARBONIA launched a special the community in Orlova-Výhoda (CZ). 3. Payment on the release of land from support programme for individuals who Payments by OKD to municipalities on mines and mining activity in their territories, 2011 (EUR) Total number of items of real estate bought in 2011 Karviná Mine ČSM Mine Darkov Mine Paskov Mine the agricultural land fund and forestry want to build houses in localities in Municipality Payment for an mining area1 Payments on minerals extraction – hard coal Bought from land fund (pursuant to Act no. 334/1992, which the company is aware there may be Individuals 44 5 11 0 on the protection of the agricultural Karviná 16,149.45 2,051,682.39 adverse effects caused by deep mining. Firms 5 1 3 0 land fund) – paid into the state budget Doubrava 2,713.91 529,177.10 Under this programme, NWR KARBONIA Type of real estate Houses + land 24 5 5 0 through the customs authorities. In 2011, will pay the costs of reinforcing the Stonava 5,662.87 696,450.87 Land 18 14 8 0 these payments were redistributed by buildings’ foundations to withstand any Horní Suchá 1,119.24 1,345.38 the state in the following ratio subsidence or shocks. 33 applications were Civic amenity 2 0 1 0 » 75 per cent to the state budget Orlová 4,456.61 810,664.46 received in 2011 for a total compensation Garden sheds 5 0 0 0 » 15 per cent to the State Havířov 4,242.37 0.00 amount of EUR 170,000. Number of Number of households 26 5 5 0 Environmental Fund households affected by buy-up Petřvald 394.39 0.00 » 10 per cent to municipalities Albrechtice u Českého Těšína 2,904.39 4,484.55 Staříč 7,264.21 345,310.49 Payments on the release of land from the Public meetings with the community in 2011 agricultural and forestry land fund are low Fryčovice 2,896.34 26,458.85 Development project Number of meetings compared to the other payments, so OKD Žabeň 881.86 0.00 does not keep records on them by territory. Orlová-Výhoda (CZ) 2 Sviadnov 900.89 0.00 Staré Město u Karviné (CZ) 1 Furthermore, money goes to municipalities, Brušperk 1,302.07 59,644.53 Frenštát pod Radhoštěm (CZ) 2 firms and individuals from the financial Frýdek-Místek 2,965.51 0.00 Dębieńsko (Poland) 8 reserves created for mining damages Frenštát pod Radhoštěm 3,468.61 0.00 and compensation, i.e. mining damages to property, and also rehabilitation and Trojanovice 10,410.94 0.00 reclamation (Article 37a of the Mining Act) Kunčice pod Ondřejníkem 7,338.02 0.00 (for more information on mining damages Other municipalities 5,867.71 0.00 see page 97). Municipalities total 80,939.41 4,525,218.63 1 Payments to the state and municipalities State budget 0.00 1,454,183.61 comprise taxes paid, payments for social and health insurance, fees, payments on minerals Total 80,939.41 5,979,402.24 extraction and for mining areas (see Article 32 of the Mining Act), charges for air pollution, 1 Payments for a mining area are paid on those mining areas that are in the organisation’s administration as of discharging wastewater and removal of land 1 January of a given year regardless of how the mining area territory is used, i.e. it is irrelevant whether extraction is from the agricultural and forestry land fund. taking place, reclamation is taking place or nothing is being done at all. 96 97

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≥ GRI DMA SO Closure ≥ GRI SO1 planning ≥ GRI MM6 ≥ GRI SO1 ≥ GRI MM11 Mining activity ≥ GRI MM10 and the community

Closures Mining damages of extraction (e.g. land subsidence) and How mining damage is dealt with In OKD, the process of phasing-out and Mining damages in the Czech Republic environmental impacts must always have closing mines in inefficient areas went are dealt with by Article 9 of the Mining been resolved. Environmental impacts » Real estate owner submits a mining ahead in 2010 and 2011 in line with the Act. The company whose activity caused are dealt with under the EIA3 process. The damage settlement request the medium-term outlook, the approved mining damages is responsible for the impacts of extraction on real estate are real estate is inspected by a mining closures plan, project documentation and damages. The act deems the following dealt with in mine opening, preparation damage technician, with two possible the approved technical mining plan2 for to be such damages: damage to tangible and extraction plans (known as ‘POPD conclusions: 2010 and 2011 at the Karviná Mine, ČSA property; the loss of surface and plans’) lodged with the appropriate > it is a simple matter (small cracks mining site (Doubrava locality). The third ground waters (or reduction in yield or mining authority pursuant to Article 32 etc.) representing damage of up to stage of phasing-out at the Dukla locality deterioration of quality). of the Mining Act and Article 10 of Act approx. EUR 610 and the mining also continued. The socio-medical claims No. 61/1988, on Mining Activity, Explosives damage technician performs an of miners released in consequence of the The company whose activity has caused and the State Mining Administration. expert cost calculation; phasing-out of extraction were settled mining damages is obliged to compensate > it is a more complicated matter during this process. OKD also undertook for these damages by: Article 33 of the Mining Act provides that – OKD commissions an expert rehabilitation work to restore areas every company is obliged to conclude opinion in order to determine and affected by mining, which was funded out » paying for the costs (associated with ‘agreements on conflicts of interest’ put a value on the influence of of operational resources and the reserve preventive work or associated with with individuals or firms and other mining damage. created pursuant to Article 31 (6) of the procuring an alternative water source); organisations whose property or interests » If OKD acknowledges the mining Mining Act. » providing finances up to the amount may be put at risk by the exploitation of damage on the basis of the expert One of the objectives of PERSP 2015 programme is the optimisation of surface and underground of the envisaged damage in justified a deposit, i.e. by extraction. Agreements opinion, there are two possible All activities linked to technical logistics. cases (e.g. utilities, telecommunication on conflicts of interest must be signed courses of action: rehabilitation of the surface lands and cabling, local roads etc.); before the relevant works are incorporated > Specification of the costs of phasing out and closing mines in inefficient parts of mining areas the real estate owner demands to restoring areas affected by mining, » providing an alternative building into POPD plans. Another necessary financial compensation for mining EUR million 2010 2011 including the settlement of socio-medical and indemnification (including aspect of POPD plans is the enumeration damage and sees to the repairs claims related to phasing-out, were funded Technical rehabilitation 1.05 0.40 indemnification for movable property). of the envisaged costs of settling mining himself, so the relevant agreement by OKD for the total figure of EUR 555,000. Investments necessitated by phasing-out 0 0 damages arising in connection with the is concluded and, once signed, Socio-medical costs associated with phasing-out 0 .18 0 .16 NWR Group’s costs related to mining planned activity and of rehabilitation and 90 per cent of the recognised damages in 2011 reached a total amount reclamation of the affected land, including mining damage amount is paid as Restoring areas affected by mining activity 0 0 of EUR 5.8 million. a proposed amount and proposed means an advance for the repairs; Total 1.23 0.56 of creating the necessary financial > the owner demands that the A list of significant disputes concerning reserve. repairs be done by a contractor, compensation for mining damages is i.e. an agreement to that effect given in the Ethics and Society chapter on NWR Group was not involved in any legal is signed with the owner and an pages 27–29. disputes concerning rights to the use of appropriate contract for work is land by a local community in 2011. signed with the selected building Under Czech law, before a new mining firm. site is opened or existing sites are » Once the work has been done expanded, issues with landowners who it is formally delivered – a final may be affected by the consequences 3 See the Environment chapter on page 57. settlement is drawn up with the contractor, or the final instalment is paid to the owner, and the case is Overview of filled and processed applications for mining damages (2011) closed. Firms Individuals Total

OKD business units Filled Processed Filled Processed Filled Processed Darkov Mine 34 34 53 53 87 87 Karviná Mine 45 42 88 72 133 114 Paskov Mine 10 10 143 140 153 150 ČSM Mine 30 28 124 105 154 133 Dukla mining site1 2 2 7 5 9 7 Total 121 116 415 375 536 491 2 Technical mining plan is an internal annual business plan of individual Mines. 1 Dukla mining site 1 February 2006 became part of Paskov Mine and operation was discontinued the same year. New World Resources Sustainability Report 2011

NWR operations purchase of materials NWR Group – CAPEX EUR million EUR million and spare parts Supply chain 2008 2009 2010 2011 2008 2009 2010 2011 300 200

284 192 240 160 185 250 NWR operations purchase of materials 158 221 and spare parts 180 120 137 194 120 80

million 60 40 EUR 0 0

Highlights EUR 192 million was spent on buying materials and services Regular on-site inspection on the premises of suppliers of materials and spare parts to NWR Group became standard practice in 2011 Preparations went ahead for the excavation of a crosscut between Darkov Mine and the mining site ČSA of Karviná Mine, a significant development investment The project for deepening the mining pit at Karviná Mine, mining site ČSA, was drawn up NWR Group’s capital expenditure (CAPEX) was EUR 194 million in 2011

Photo: New longwall set purchased under POP 2010 programme. 100 101

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≥ GRI DMA HR ≥ GRI DMA HR Investment and Investment and procurement procurement practices practices ≥ GRI DMA PR ≥ GRI DMA PR Strategy Materials Materials stewardship stewardship ≥ GRI DMA PR Product ≥ GRI DMA PR Product and service labelling and service labelling ≥ GRI MM11 ≥ GRI MM11

Relations with NWR Group’s suppliers are its tried-and-tested suppliers, which premises and to demand access to the human rights – it is therefore a binding an integral part of sustainability strategy, participate in finding solutions for the necessary documents for more effective consideration in NWR, OKD, OKK and especially with regard to the following needs of internal customers (OKK, OKD control. The NWR Group places great NWR KARBONIA. The vast majority of principles: and its business units), not just in terms emphasis on preventing corruption, and stakeholders, including customers and of quality and price but also as regards this is covered by a special clause in every suppliers, are from the Czech Republic, » improving health and safety at work; the related logistical requirements for supplier contract. Poland or other EU countries, so OKD » investing in new technologies; and deliveries of materials and spare parts and OKK have no special agreements » cutting costs. and technical-support requirements. One significant objective for OKD in or policies focusing on these areas. 2012 is making regular supplier audits Nevertheless, the NWR Group considers Purchasing in NWR focuses on 2 main In 2011, NWR spent EUR 192 million on standard practice and developing it imperative to stress the issues of areas: purchasing materials and spare parts for even more detailed supplier audit work safety, anti-corruption conduct its operations. documentation. These audits will result and responsibility for products, which 1. investments (CAPEX); and in the best suppliers being awarded an are incorporated into contracts with and 2. purchasing of material and spare parts. We regard the pilot supplier audit OKD TOP Q certificate. A supplier can audits of suppliers. conducted by OKD in 2011 as an important score a maximum of 100 points in an Investments step in managing relations with suppliers. audit. OKD’s target for 2012 is to achieve Investments in 2011 followed up the The audit has two phases: an average result of over 90 points, completed POP 2010 and COP 20101 based on formulated and implemented investment programmes designed to 1. a questionnaire is filled in by the recommendations. At least 20 such audits increase productivity, efficiency and safety supplier; and will be conducted in 2012. in coal extraction and coke production. 2. on-site inspections are conducted at the selected suppliers’ premises by It follows, then, that the principal For example, under POP 2010, which OKD’s purchasing department. objective for 2012 is implementing was launched in 2008, modern mining systematic supplier quality checks. This technology such as roadheaders, drill Suppliers are selected for on-site should lead to more successful detection New longwall-shields supports purchased under POP 2010 in mining site Lazy of the Karviná Mine. jumbos and longwall-shields supports inspection after the questionnaires of poor-quality supplies at the input stage, with higher load-bearing capacity were delivered to the purchasing department thus minimising the losses associated purchased. Besides improving productivity, With a total cost of EUR 63 million, the NWR operations – purchase of materials are assessed. with efforts to utilise such supplies in EUR million enhancing health and safety was also construction of the new coking battery and spare parts operations. central to the POP 2010 programme. The no. 10 at the Svoboda Coking Plant was 2008 2009 2010 2011 The actual audit involves a set of 200 new technologies also improve hygiene the biggest COP 2010 investment project. pre-prepared questions that are put to the Naturally, ensuring that suppliers comply 192 conditions in underground workplace 160 185 supplier and subsequently verified on-site. with quality standards and certain environments. Dust levels at working faces In 2010, a decision was made to implement 158 The on-site inspection focuses on both sustainability requirements should and headings are significantly reduced by the PERSPective 2015 programme, which 120 137 technical parameters and: not increase the materials and spares the automatic water spray onto the coal continues and expands on POP 2010. purchasing costs. This endeavour is to 80 face and surrounding rock, a system both The most important investments for » certification of supplied materials be supported inter alia by longer-term the extraction and tunnelling equipment the coming period are developmental 40 and sub-supplies; purchasing plans for OKD’s business units are fitted with. All these factors contribute investments, among them the project » compliance with the safety regulations that give suppliers the opportunity to plan significantly to constant improvements in to deepen the ČSA mining site of the 0 by the supplier employees; further ahead. the safety indicators, most notably LTIFR2 Karviná Mine and the execution of a 3 km » compliance with ethical standards; and ODR3. underground crosscut between the » compliance with environmental The NWR Group purchases technologies, Darkov Mine and the mining site ČSA protection regulations; and materials and spare parts from suppliers of the Karviná Mine. When weighing up » overall satisfaction of the supplier’s from the Czech Republic, Poland, other various options for transporting coal employees. EU countries; and the USA, so NWR has between the Darkov and Karviná Mines, no special human rights policies targeting the impacts of surface transportation of If serious shortcomings are found, suppliers in the localities of our key the mined coal were also considered. the supplier is given time to remedy operations. them, followed by an additional on-site 1 See more information about POP 2010 and Purchasing of material and spare parts inspection. Respect for human rights is part of COP 2010 at http://www.newworldresources. Purchasing policy in the NWR Group the European Union’s legislation and eu/en/operations/active-mines/optimisation- is based on the principle of strategic Contracts negotiated with suppliers legal system, which encompasses the programme 2 See the Safety chapter on page 46. partnerships with key suppliers. NWR is specifically give OKD the right to conduct Universal Declaration of Human Rights 3 See the Safety chapter on page 46. interested in long-term cooperation with these on-site inspections on suppliers’ and ILO conventions on fundamental 102 103

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≥ GRI 2.8 ≥ GRI DMA EC Economic Performance ≥ GRI EC1 GRI application level Key sustainability ≥ GRI EC4 check statement data summary

Key economic indicators

Year 2011 according to IFRS as adopted by EU EUR million Group’s total consolidated revenue 1,632 Net sales 1,632 Value added (including change in inventories) 863 Consolidated revenues (sales of coal, coke and by-products) excluding transport 1,469 EBITDA 454 Operating profit 276 Profit before tax 187 Income tax (including deferred tax) 57 Net profit 130 Total assets 2,374 Total equity 753 Total liabilities 1,621 Number of employees (monthly average including contractors) 18,710

Other economic indicators

Year 2011 according to IFRS as adopted by EU EUR million Material consumption, energy and service expenses 808 Personnel expenses including benefits 384 Corporate income tax paid 56 Total other taxes and contributions 122 Subsidies received from state/government/EU 1

Financial indicators

Year 2011

Net debt/EBITDA 86.12% Net debt/equity 51.93% EBITDA margin (EBITDA/net sales) 27.82% EQUITY ratio (debt/equity) 1.23 ROE 17.26% 104 105

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≥ GRI 2.8 ≥ GRI 2.8 Key sustainabillity data summary

Production indicators Health and safety indicators Indicator Unit 2008 2009 2010 2011 Indicator Unit 2008 2009 2010 2011 Coal Mt 12.7 11.0 11.2 11.0 Fatalities number of 7 3 3 5 Coke Kt 1,296 840 1,006 770 Recorded injuries number of 428 354 275 253 Lost Time Injury Frequency Rate LTIs per million hours worked 12.07 10.85 8.25 7.64 Occupational diseases number of 54 69 71 65

Environmental indicators Occupational Disease Rate number of shifts missed due 0.30 0.42 0.43 0.39 to absence per planned number Indicator Unit 2008 2009 2010 2011 of hours worked times factor Direct energy consumption GJ n/a n/a 138,368 148,815 200,000 Indirect energy consumption GJ n/a n/a 4,783,236 4,307,448 Absentee Rate number of cases of occupational 1,599 1,168 1,208 1,238 disease per hours worked times Total water consumption thousand m3 30,563 30,110 36,062 25,344 factor 200,000 Total water discharge thousand m3 12,709 13,930 11,766 11,079 Total volume of water recycled thousand m3 10,631 11,422 16,228 9,152 Total area of completed reclamation ha 146.8 34.3 75.7 111.4 Social indicators Total area of completed reclamation cumulated ha 1,465.5 1,490.8 1,566.5 1,677.9 Indicator Unit 2008 2009 2010 2011 Total amount of waste rock and flotation tailings tonnes 5,505,945 5,231,085 5,420,835 5,329,548 Average monthly number of employees number of 15,5421 15,6301 14,9211 14,275 NOX emissions tonnes 545 249 376 189 Average monthly number of contractors number of 3,335 3,225 3,679 4,435 SO2 emissions tonnes 115 140 172 108 Average monthly number of employees covered number of 16,515 15,630 14,921 14,233 CO emissions tonnes 833 270 509 171 by Collective Agreements PAH emissions tonnes 0.196 0.245 0.230 0.134 Average hours of training per employee per year hours 4.6 12.4 18.6 21.8 PM emissions tonnes 277 251 239 200 Corporate Social Investment EUR million 6.9 7. 0 3.1 7. 9 Total weight of miscellaneous waste tonnes 63,415 41,684 41,773 44,597 1 Only NWR operations. Total weight of hazardous waste tonnes 628 539 509 1,548 Environmental fines EUR thousand n/a n/a n/a 36.6 106 107

New World Resources New World Resources Sustainability Report Sustainability Report 2011 2011

Overview Our approach Our people Environment Community Supply chain Additional information Overview Our approach Our people Environment Community Supply chain Additional information Subsidiaries’ organisational structures

Organisational structure OKD, a.s. (two-tier system) Organisational structure of OKK Koksovny, a.s. (two-tier system) valid as at 31 December 2011 valid as at 31 December 2011

Board of Directors Board of Directors

Klaus-Dieter Beck Ján Fabián Miloslava Trgiňová Karl Friedrich Jakob Marek Jelínek Michal Kuča Radim Tabášek Antonín Klimša Chairman Vice Chairman Vice Chairwoman Member Member Chairman Vice Chairman Member

Mike Salamon Stanley C. Suboleski Member Member Supervisory Board

Ladislav Feber Jarmila Ivánková Pavel Petr Supervisory Board Chairman Vice Chairwoman Member

Luboš Řežábek Jan Hanousek Otto J. Jelinek Miroslav Syrový Jaroslav Vlach Chairman Vice Chairman Member Member Member Management

František Válek Michal Kuča Petr Mokroš Petr Poledník Ladislav Eštočák Petr Václavík Member Chief Executive Production Deputy Technical Deputy Economic Deputy HR and Wage Issues Officer Director Director Director Deputy Director

Management Related information online at www.koksovny.cz/en/about-us/management Klaus-Dieter Beck Ján Fabián Jarmila Ivánková Leo Bayer Zdeněk Durčák Chief Executive Chief Administration Acting Chief Financial Chief Operating Chief Commercial Officer and Development and IT Officer Officer Officer Officer, Deputy CEO for Finances Organisational structure of NWR KARBONIA S.A. (two-tier system) valid as at 31 December 2011 Jan Matula Radim Babinec Radim Tabášek Petra Mašínová Chief Engineering Chief Legal Officer Chief HR and Mining Chief Public Relations Officer District Development & Communication Board of Directors Officer Officer Ján Fabián Klaus-Dieter Beck Jerzy Wacław Klinowski Leszek Chraścina Chairman Vice Chairman Vice Chairman Vice Chairman

Supervisory Board

Jiří Plac Antonín Klimša Richard Pavlík Chairman Vice Chairman Member

Management

Ján Fabián Jerzy Wacław Klinowski Chief Executive Chief Operating Officer Officer

Related information online at Related information online at www.okd.cz/en/about-us/management www.nwrkarbonia.pl/en/about-us/management 108 109

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≥ GRI 3.12 ≥ GRI 3.12 GRI content index1

G3 Content Index – Mining & Metals Sector Supplement

Profile Profile disclosure / disclosure / aspect / aspect / indicator Description Reported Reference and page number2 indicator Description Reported Reference and page number2

1.0 Strategy and Analysis Table continued 1.1 Statement from the most senior decision-maker of the Fully 6–9 3.10 Explanation of the effect of any re-statements of information Fully 16–17 organization. provided in earlier reports, and the reasons for such re-statement (e.g.,mergers/acquisitions, change of base years/periods, nature 1.2 Description of key impacts, risks, and opportunities. Fully 14–15, 20–21, 25, 34–35; NWR Annual Report of business, measurement methods). and Accounts 2011 pages 24–27. 3.11 Significant changes from previous reporting periods in the scope, Fully 16 2.0 Organizational Profile boundary, or measurement methods applied in the report. 2.1 Name of the organization. Fully 1 3.12 Table identifying the location of the Standard Disclosures Fully 108–112 2.2 Primary brands, products, and/or services. Fully 1 in the report. 2.3 Operational structure of the organization, including main divisions, Fully 1, 4–5 3.13 Policy and current practice with regard to seeking external Fully No external assurance in 2011, however we operating companies, subsidiaries, and joint ventures. assurance for the report. plan for third-party assurance to be carried out in the future (2–3 years). 2.4 Location of organization’s headquarters. Fully 1 4.0 Governance, Commitments, and Engagement 2.5 Number of countries where the organization operates, and names Fully 1, 4–5 of countries with either major operations or that are specifically 4.1 Governance structure of the organization, including committees Fully 22; NWR Annual Report and Accounts 2011 relevant to the sustainability issues covered in the report. under the highest governance body responsible for specific tasks, pages 68–70. such as setting strategy or organizational oversight. 2.6 Nature of ownership and legal form. Fully 1 4.2 Indicate whether the Chair of the highest governance body is also Fully 23 2.7 Markets served (including geographic breakdown, sectors served, Fully 1, 4, 32; NWR Annual Report and Accounts 2011 an executive officer. and types of customers/beneficiaries). page 5, 130; http://www.newworldresources.eu/ en/products/coking-coal; 4.3 For organizations that have a unitary board structure, state the Fully 22–23 http://www.newworldresources.eu/en/ number of members of the highest governance body that are products/thermal-coal independent and/or non-executive members. 2.8 Scale of the reporting organization. Fully 42, 103–04; NWR Annual Report and 4.4 Mechanisms for shareholders and employees to provide Fully 22–23, 41; NWR Annual Report and Accounts Accounts 2011 pages 5, 16, 130, 173–175. recommendations or direction to the highest governance body. 2011 pages 72–81, Corporate Governance Policy article 6.4 2.9 Significant changes during the reporting period regarding size, Fully 1 (http://www.newworldresources.eu/en/ structure, or ownership. corporate-governance/policies). 2.10 Awards received in the reporting period. Fully 29 4.5 Linkage between compensation for members of the highest Fully 23; NWR Annual Report and Accounts 2011 governance body, senior managers, and executives (including page 72. 3.0 Report Parameters departure arrangements), and the organization’s performance 3.1 Reporting period (e.g., fiscal/calendar year) for information provided. Fully 16 (including social and environmental performance). 3.2 Date of most recent previous report (if any). Fully 16 4.6 Processes in place for the highest governance body to ensure Fully 23; NWR Annual Report and Accounts 2011 conflicts of interest are avoided. page 80, Corporate Governance Policy article 3.3 Reporting cycle (annual, biennial, etc.). Fully 16 8.14 (http://www.newworldresources.eu/en/ corporate-governance/policies). 3.4 Contact point for questions regarding the report or its contents. Fully 17 4.7 Process for determining the qualifications and expertise Fully NWR Annual Report and Accounts 2011 3.5 Process for defining report content. Fully 16–17 of the members of the highest governance body for guiding page 71, Corporate Governance Policy article 6 3.6 Boundary of the report (e.g., countries, divisions, subsidiaries, Fully 16–17 the organization’s strategy on economic, environmental, (http://www.newworldresources.eu/en/ leased facilities, joint ventures, suppliers). and social topics. corporate-governance/policies). 3.7 State any specific limitations on the scope or boundary of the report . Fully 16–17 4.8 Internally developed statements of mission or values, codes Fully 22, 26–28, 29 of conduct, and principles relevant to economic, environmental, 3.8 Basis for reporting on joint ventures, subsidiaries, leased Fully 16–17 and social performance and the status of their implementation. facilities, outsourced operations, and other entities that can significantly affect comparability from period to period and/or 4.9 Procedures of the highest governance body for overseeing Fully 22–24; Corporate Governance Policy article between organizations. the organization’s identification and management of economic, 5 (http://www.newworldresources.eu/en/ environmental, and social performance, including relevant corporate-governance/policies). 3.9 Data measurement techniques and the bases of calculations, Fully 16–17 risks and opportunities, and adherence or compliance with including assumptions and techniques underlying estimations internationally agreed standards, codes of conduct, and principles. applied to the compilation of the Indicators and other information in the report. 4.10 Processes for evaluating the highest governance body’s own Fully NWR Annual Report and Accounts 2011 performance, particularly with respect to economic, environmental, page 72, Corporate Governance Policy and social performance. article 5.4 (http://www.newworldresources.eu/ en/corporate-governance/policies). 4.11 Explanation of whether and how the precautionary approach Fully 27 or principle is addressed by the organization.

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Table continued Table continued 4.12 Externally developed economic, environmental, and social Fully 26–29 DMA LA Disclosure on Management Approach LA charters, principles, or other initiatives to which the organization Employment Fully 40 subscribes or endorses. Aspects COMM

4.13 Memberships in associations (such as industry associations) and/ Fully 33; http://www.newworldresources.eu/en/ Labor/management relations COMM Fully 41 or national/international advocacy organizations in which the about-us/membership Occupational health and safety Fully 22, 40 organization: 1. Has positions in governance bodies; 2. Participates COMM in projects or committees; 3. Provides substantive funding beyond Training and education Fully 41 routine membership dues; or 4. Views membership as strategic. Diversity and equal opportunity Fully 41 4.14 List of stakeholder groups engaged by the organization. Fully 30 DMA HR Disclosure on Management Approach HR 4.15 Basis for identification and selection of stakeholders with whom Fully 30–32 to engage. Aspects Investment and procurement practices Fully 100–101 4.16 Approaches to stakeholder engagement, including frequency Fully 28, 30–31 Non-discrimination Fully 41, 45 of engagement by type and by stakeholder group. Freedom of association and collective bargaining Fully 41, 45 4.17 Key topics and concerns that have been raised through stakeholder Fully 25 Child labor Not Not material. We do not report on this issue engagement, and how the organization has responded to those key (no intention of reporting in the future) as topics and concerns, including through its reporting. the disclosure is not material to our business DMA EC Disclosure on Management Approach EC because child labour is prohibited by EU legislation and by the law regulation in the Aspects Economic performance Fully 103; NWR Annual Report and Accounts 2011 Czech Republic and Poland. pages 16–17, 104–111, 126, 128, 132 Forced and compulsory labor Not Not material. We do not report on this issue Market presence Fully 1 (no intention of reporting in the future) as the disclosure is not material to our business Indirect economic impacts Fully 84, 86 because forced and compulsory labour is prohibited by EU legislation and by the law DMA EN Disclosure on Management Approach EN regulation in the Czech Republic and Poland. Aspects Materials Not Not material. We do not report on this issue Security practices Not Not material. (no intention of reporting in the future) as the disclosure is not material to our Indigenous rights COMM Not Not applicable. There are no Indigenous business. NWR Group is a producer and People within the meaning of the original supplier of raw materials. Consequently, culture in the areas of NWR operations. it does not use a significant quantity of other raw materials or partially processed DMA SO Disclosure on Management Approach SO materials that go towards the end product. Aspects Community Fully 84–85 Product packaging is also insignificant for NWR Group, as the produced raw materials Artisanal and small-scale mining Not Not applicable. We do not report on this are not packaged – 98 per cent of output is point (no intention of reporting in the future) transported loose by rail. since the disclosure as required by the GRI Guidelines is not applicable to our business Energy Fully 70 because there are no NWR operating sites where ASM takes place on or is adjacent to. Water Fully 74–75 Resettlement Fully 84–85 Biodiversity Fully 56–57 Closure planning Fully 96; there are no plans to close any of our Emissions, effluents and waste 3 Fully 66, 78 COMM COMM current operations in coming 5 years. Products and services Fully 66 Grievance mechanisms and procedures Fully 84–85 Compliance Fully 56 Emergency Preparedness COMM Fully 49 Transport Fully 56 Corruption Fully 26 Overall Fully 56 Public policy Fully 27 Anti-competitive behavior Fully 27 Compliance Fully 26–27

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Table continued Table continued

DMA PR Disclosure on Management Approach PR EC7 COMM Procedures for local hiring and proportion of senior management Fully 42; NWR focuses concentrates on hiring and workforce hired from the local community at significant people from regions of its operations or Aspects Materials stewardship Fully 100–101 locations of operation. neighbouring regions (e.g. Slovakia). When Customer health and safety Fully Coal and Coke Catalogue (http://www. necessary NWR arranges the daily transport newworldresources.eu/en/media/download) for such employees. Product and service labelling Fully 100–101; Coal and Coke Catalogue (http:// EC8 Development and impact of infrastructure investments and Fully 86–91; www.newworldresources.eu/en/media/ services provided primarily for public benefit through commercial, http://www.nadaceokd.cz/applicants/faq-en download), safety information and technical in-kind, or pro bono engagement. specification clauses are provided with all EN Environmental mining products and directed at industrial users as a part of the contract. None of our EN1 Materials used by weight or volume. Not 80 products are delivered directly to consumers. EN2 Percentage of materials used that are recycled input materials. Not 80 Aspects Marketing communications Fully 27 COMM EN3 Direct energy consumption by primary energy source. Fully 6 7, 71–72 Customer privacy Not Not applicable. NWR does not deal directly with consumers but sells on commodity EN4 Indirect energy consumption by primary source. Fully 6 7, 72 markets and to industrial users. EN5 Energy saved due to conservation and efficiency improvements. Fully 70, 71, 73 Compliance Fully NWR products comply with the legal requirements of the Czech Republic, Poland EN7 Initiatives to reduce indirect energy consumption and reductions Fully 70, 71, 73 and the legal requirements of the countries achieved. where are clients are located. There were no EN8 Total water withdrawal by source. Fully 74–75 legal disputes concerning our products. EN9 Water sources significantly affected by withdrawal of water. Fully 74–75 EC Economic

4 EN10 Percentage and total volume of water recycled and reused. Fully 76, 77 EC1 COMM Direct economic value generated and distributed, including Fully 89, 94, 103; NWR Annual Report and revenues, operating costs, employee compensation, donations Accounts 2011 pages 16–17. EN11 Location and size of land owned, leased, managed in, or adjacent Fully 61, 62–65 and other community investments, retained earnings, to, protected areas and areas of high biodiversity value outside and payments to capital providers and governments. protected areas.

EC2 Financial implications and other risks and opportunities for Fully 34, 67; NWR Annual Report and Accounts EN12 COMM Description of significant impacts of activities, products, and Fully 62–65 the organization’s activities due to climate change. 2011 pages 24–27; Financial consequences services on biodiversity in protected areas and areas of high and other risks resulting for the NWR from biodiversity value outside protected areas. the impact of climatic change are not known. 5 We are not aware of the existence of any MM1 Amount of land (owned or leased, and managed for production Fully 56, 61 comprehensive document prepared by activities or extractive use) disturbed or rehabilitated. Czech authorities, which we could base our EN13 COMM Habitats protected or restored. Fully 62–65; Brochure ‘Returning life to the region’ calculations on, and therefore it is impossible at http://www.newworldresources.eu/en/ to perform any calculation of potential sustainability/our-environment/reclamation financial consequences for the NWR.

EN14 COMM Strategies, current actions, and future plans for managing impacts Fully 57–58 EC3 Coverage of the organization’s defined benefit plan obligations. Fully 44 on biodiversity. EC4 Significant financial assistance received from government. Fully 103; There were 3 subsidies NWR received in MM2 The number and percentage of total sites identified as requiring Fully 60–61, 62–65 2011: 1. co-financing of the construction of biodiversity management plans according to stated criteria, and Golf Resort Lipiny from the EU (EUR 743,000; the number (percentage) of those sites with plans in place. see page 58), 2. retraining subsidies provided by Czech government (EUR 42,000), EN15 Number of IUCN Red List species and national conservation list Fully The number and specification of species 3. EU grant OPTI-MINE (EUR 137,000). species with habitats in areas affected by operations, by level of listed on IUCN Red list and national extinction risk. conservation list are part of each EIA EC5 Range of ratios of standard entry level wage compared to local Fully 44 documentation on every NWR operation. minimum wage at significant locations of operation. EN16 Total direct and indirect greenhouse gas emissions by weight. Fully 67 EC6 Policy, practices, and proportion of spending on locally-based Not Not material. NWR Group purchases suppliers at significant locations of operation. technologies, materials and spare parts from EN17 Other relevant indirect greenhouse gas emissions by weight. Fully 67 suppliers from the Czech Republic, the European Union and the USA, so NWR has EN18 Initiatives to reduce greenhouse gas emissions and reductions Fully 66–67, 68 no special human rights policies targeting achieved. suppliers in the localities of our key operations.

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Table continued Table continued EN19 Emissions of ozone-depleting substances by weight. Not Not material. NWR Group is first and LA6 Percentage of total workforce represented in formal joint Fully 46 foremost a raw materials producer, so the management-worker health and safety committees that help question of emissions of substances harmful monitor and advise on occupational health and safety programs.

to the ozone layer is not relevant to it. LA7 COMM Rates of injury, occupational diseases, lost days, and absenteeism, Fully 46–47; injury statistics are reported

EN20 COMM NOx, SOx, and other significant air emissions by type and weight. Fully 66 and number of work-related fatalities by region. in compliance with national legislation in location of NWR’s operations. EN21 Total water discharge by quality and destination. Fully 75 LA8 Education, training, counseling, prevention, and risk-control Not Not material. The Group has no policies and

EN22 COMM Total weight of waste by type and disposal method. Fully 78–79 programs in place to assist workforce members, their families, programmes in this area other than what MM3 Total amounts of overburden, rock, tailings, and sludges and their Fully 78–79 or community members regarding serious diseases. required by the law and included in health associated risks. and social benefits. (See 64–71) Vast majority of NWR Group employees are citizens of the

EN23 COMM Total number and volume of significant spills. Fully 79 Czech Republic and Poland. Due to high level of medical care and good results in the area EN24 Weight of transported, imported, exported, or treated waste Fully None to report of serious diseases in both countries, deemed hazardous under the terms of the Basel Convention Annex NWR does not consider this topic relevant. I, II, III, and VIII, and percentage of transported waste shipped internationally. LA9 Health and safety topics covered in formal agreements Fully 46; individual Collective Agreements with trade unions. (in Czech language only). EN25 Identity, size, protected status, and biodiversity value of water Fully 62–65, 74 bodies and related habitats significantly affected by the reporting LA10 Average hours of training per year per employee by employee Fully 53 organization’s discharges of water and runoff. category. EN26 Initiatives to mitigate environmental impacts of products and Fully 66, 69, 76–77; http://www.koksovny.cz/en/ LA11 Programs for skills management and lifelong learning that support Fully 53 services, and extent of impact mitigation. living-environment/ecological-investments the continued employability of employees and assist them in managing career endings. EN27 Percentage of products sold and their packaging materials that are Not Not material, NWR‘s products are raw reclaimed by category. materials typically used as inputs into further LA13 Composition of governance bodies and breakdown of employees Partially 42, 43 manufacturing processes. Packaging is not per category according to gender, age group, minority group applicable to bulk product transport by rail. membership, and other indicators of diversity. EN28 Monetary value of significant fines and total number of Fully 56, 66, 76; Number of non-monetary LA14 Ratio of basic salary of men to women by employee category. Fully 44 non-monetary sanctions for non-compliance with environmental sanctions was 0. There was no case laws and regulations. brought through dispute resolution HR Social: Human Rights mechanisms in 2011. HR1 Percentage and total number of significant investment agreements Not Not material. Respect to human rights EN29 Significant environmental impacts of transporting products and Fully 66; Impact of transport products is low that include human rights clauses or that have undergone human is incorporated in Czech and Polish laws other goods and materials used for the organization’s operations, because 98 per cent of NWR output rights screening. and other legal regulations, including the and transporting members of the workforce. is transported in bulk by rail which is Universal Declaration of Human Rights and considered one of the most environmental the ILO Human Rights Convention. As such, friendly means of transport. it is regarded in the Group as a binding standard. The majority of stakeholders EN30 Total environmental protection expenditures and investments Partially 56 (including suppliers and customers) are by type. predominantly from the Czech Republic, Poland or in a minority from the EU LA Social: Labor Practices and Decent Work and therefore the Group has no special LA1 Total workforce by employment type, employment contract, Fully 42 agreements or policies in this respect. and region. (Proportion of agreements is 0 per cent.) LA2 Total number and rate of employee turnover by age group, Fully 43 HR2 Percentage of significant suppliers and contractors that have Not Not material. Respect to human rights gender, and region. undergone screening on human rights and actions taken. is incorporated in Czech and Polish laws and other legal regulations, including the LA3 Benefits provided to full-time employees that are not provided Fully 44 Universal Declaration of Human Rights and to temporary or part-time employees, by major operations. the ILO Human Rights Convention. As such, it is regarded in the Group as a binding Percentage of employees covered by collective bargaining Fully 45 LA4 standard. The majority of stakeholders agreements. (including suppliers and customers) are LA5 Minimum notice period(s) regarding significant operational Fully 45 predominantly from the Czech Republic, changes, including whether it is specified in collective agreements. Poland or in a minority from the EU and therefore the Group has no special MM4 Number of strikes and lock-outs exceeding one week’s duration, Fully 45; None to report agreements or policies in this respect. by country. (Proportion of agreements is 0 per cent.)

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Table continued Table continued HR4 Total number of incidents of discrimination and actions taken. Fully 27 SO7 Total number of legal actions for anti-competitive behavior, Fully 28; None to report anti-trust, and monopoly practices and their outcomes.

HR5 COMM Operations identified in which the right to exercise freedom of Fully 45; None to report

association and collective bargaining may be at significant risk, SO8 COMM Monetary value of significant fines and total number Fully 28; None to report and actions taken to support these rights. of non-monetary sanctions for non-compliance with laws and regulations. HR6 Operations identified as having significant risk for incidents of Not Not applicable. We do not report on this child labor, and measures taken to contribute to the elimination point (no intention of reporting in the future) PR Social: Product Responsibility of child labor. since the disclosure as required by the GRI Guidelines is not applicable to our business MM11 Programs and progress relating to materials stewardship. Fully 97, 100–101; Coal and Coke Catalogue because child labour is prohibited by EU (http://www.newworldresources.eu/en/ legislation and by the law regulation in the media/download). Czech Republic and Poland. PR1 Life cycle stages in which health and safety impacts Fully 81 HR7 Operations identified as having significant risk for incidents Not Not applicable. We do not report on this of products and services are assessed for improvement, of forced or compulsory labor, and measures to contribute point (no intention of reporting in the future) and percentage of significant products and services categories to the elimination of forced or compulsory labor. since the disclosure as required by the GRI subject to such procedures. Guidelines is not applicable to our business PR2 Total number of incidents of non-compliance with regulations Fully None to report because forced and compulsory labour is and voluntary codes concerning health and safety impacts of prohibited by EU legislation and by the law products and services during their life cycle, by type of outcomes. regulation in the Czech Republic and Poland. PR3 Type of product and service information required by procedures, Fully Safety information and technical MM5 Total number of operations taking place in or adjacent to Not Not material. There are no Indigenous People and percentage of significant products and services subject to specification clauses are provided with all Indigenous Peoples’ territories, and number and percentage within the meaning of the original culture in such information requirements. mining products and directed at industrial of operations or sites where there are formal agreements with the areas of NWR operations. users as a part of the contract. None of Indigenous Peoples’ communities. our products are delivered directly to SO Social: Society consumers; Coal and Coke Catalogue (http://www.newworldresources.eu/en/

SO1 COMM Nature, scope, and effectiveness of any programs and Fully 25, 30–31, 34, 36–37, 49, 62–65, 84–93, media/download). practices that assess and manage the impacts of operations 95–97 on communities, including entering, operating, and exiting. PR4 Total number of incidents of non-compliance with regulations Fully None to report and voluntary codes concerning product and service information MM6 Number and description of significant disputes relating to land Fully 25, 95, 97 and labeling, by type of outcomes. use, customary rights of local communities and Indigenous Peoples. PR6 Programs for adherence to laws, standards, and voluntary codes Fully 27; We do not sell products that are banned related to marketing communications, including advertising, in certain markets and our products are not MM7 The extent to which grievance mechanisms were used to Fully 27–29 promotion, and sponsorship. subject of stakeholder questions or public resolve disputes relating to land use, customary rights of local debate. We received no question or concerns communities and Indigenous Peoples, and the outcomes. regarding our products. MM8 Number (and percentage) or company operating sites where Not Not material. There are no NWR operation PR8 Total number of substantiated complaints regarding breaches Fully None to report artisanal and small-scale mining (ASM) takes place on, or adjacent sites where ASM takes place on or is of customer privacy and losses of customer data. to, the site; the associated risks and the actions taken to manage adjacent to. and mitigate these risks. PR9 Monetary value of significant fines for non-compliance Fully None to report with laws and regulations concerning the provision and use MM9 Sites where resettlements took place, the number of households Fully 95 of products and services. resettled in each, and how their livelihoods were affected in the process. MM10 Number and percentage of operations with closure plans. Fully 96; NWR Annual Report and Accounts 2011 page 156, There are no plans to close any of our current operations in coming 5 years. SO2 Percentage and total number of business units analyzed for risks Fully 26 related to corruption. SO3 Percentage of employees trained in organization’s anti-corruption Fully 26 policies and procedures. SO4 Actions taken in response to incidents of corruption. Fully 26 SO5 Public policy positions and participation in public policy Fully 27–28 development and lobbying.

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A AR: the Absentee Rate represents the total development (OKD Foundation); support Flotation tailings pond: water reservoirs where ILO: International Labour Organisation. valuable and threatened species and habitats. Resettlement: the relocation of people or number of shifts lost due to absence (work injuries, for enterprise and job creation, health sedimentation and settling of flotation tailings It is comprised of Special Areas of Conservation communities to a new location. occupational disease and non-occupational illness, (OKD Foundation projects); culture take place. IUCN: International Union for Conservation of (SAC) designated by Member States under the not including holiday and maternity leave) relative (OKD Foundation projects); education Nature. Habitats Directive, and also incorporates Special S to the total time worked times factor 200,000. Does (donations to schools, scholarships), Fatality: a death resulting from an occupational Protection Areas (SPAs) which they designate SAFETY 2010: the EUR 20 million investment not include contractors. environment (finances provided over injury or illness. J under the 1979 Birds Directive. programme aimed at improving health and and above the legal requirement); sport JORC: the Joint Ore Reserves Committee. safety across our mining operations, including B (sponsorship). G NGO’s: non-governmental organisations. upgrading personal equipment. Biodiversity: or biological diversity, is the GJ: the gigajoule (GJ) is equal to one billion (109) K variability among living organisms from all Compensatory payments: compensatory joules. Joule is a derived unit of energy or work kWh: kilowatt hour. NOx: oxides of nitrogen (nitric oxide and nitrogen SCI: or Sites of Community Importance (SCIs) sources, including land-based and aquatic payments comprise payments on mineral in the International System of Units. It is equal to dioxide). are protected sites designated under the EC eco-systems of which they are part. These extraction, payments for a mining area, the energy expended (or work done) in applying L Directive on the conservation of natural habitats includes diversity within species and of and payment on the release of land from a force of one newton through a distance of one LTIFR: the Lost Time Injury Frequency Rate O and of wild fauna and flora (92/43/EEC), also eco-systems. agricultural and forestry land funds. In addition meter, or in passing an electric current of one represents the number of reportable injuries ODR: the Occupational Disease Rate represents known as the Habitats Directive. Article 3 of the compensatory payments also include costs ampere through a resistance of one ohm for one causing at least three days of absence in NWR the number of occupational diseases relative to Habitats Directive requires the establishment C related to mining damages and the financial second. Group per million hours worked including the total hours worked by the total number of of a European network of important high-quality Carboniferous natural gas: carboniferous natural reserve for reclamation. contractors. employees for the reporting period times factor conservation sites that will make a significant gas contains 92.5 per cent methane, 2.25 per GRI: the Global Reporting Initiative is a non-profit 200,000. Does not include contractors. contribution to conserving the 231 habitat types cent higher hydrocarbons and 6.3 per cent ‘inerts’ D organization that promotes economic, Land disturbed: land disturbed by operational and 911 species identified in Annexes I and (mainly nitrogen and carbon dioxide). Direct Energy: primary energy sources used by environmental and social sustainability. activities. Occupational diseases: an occupational II of the Directive (as amended). In the Czech the company for its own consumption. Includes GRI provides all companies and organizations disease is registered when it is confirmed as a Republic, SCI is based on the Act no. 114/1992, CIP: or Continuous Improvement Programme, direct non-renewable energy sources (coal, with a comprehensive sustainability reporting Land rehabilitated: land disturbed by operational work-related compensable case by a medical on the protection of nature and the countryside. NWR’s programme to improve efficiency by natural gas and fuel distilled from crude oil) framework that is widely used around the world. activities and then reshaped and rehabilitated. practicioner/physician. rewarding employees who submit innovative and direct renewable energy sources (biofuels, SHSC: NWR’s Safety, Health and Sustainability ideas and suggestions. ethanol and hydrogen). Total direct energy GHG: greenhouse gas. Longwall mining: type of underground coal P Committee. consumption = direct primary energy purchased mining where a extended wall of coal is mined in PAH: polycyclic aromatic hydrocarbons Coal: a readily combustible rock, formed from + direct primary energy produced – direct H a sole slice. (or poly-aromatic hydrocarbons), a chemical SLE: or Significant Landscape Elements within plant remains that have been compacted, primary energy sold. ha: hectares (1 ha = 10,000 square metres). compound that contains more than one fused the meaning of Article 4 of Act No. 114/1992, chemically altered and metamorphosed by heat LTI: Lost Time Injury – an occupational injury or benzene ring. They are commonly found in on the protection of nature and landscape, and pressure over million of years. E Hours worked: total number of hours worked by illness that results in days away from work on petroleum fuels, coal products, and tar. as amended (Czech Republic) (e.g. subsidence EIA: or Environmental Impact Assessment, a employees, including training, excluding leave, any rostered shift subsequent to that on which lakes and fens). Coke: the solid carbonaceous material derived procedure that ensures that the environmental sickness and other absences, including the the injury occurred. POP 2010: NWR’s Productivity Optimisation from the destructive distillation of coal. implications of decisions are taken into account total number of contractor hours worked on-site Programme, a major capital investment Stakeholder: entity or individual that can before the decisions are made. Environmental during the year. M programme designed to improve the productivity reasonably be expected to be significantly Coke-oven gas: a gas produced during assessment can be undertaken for individual MWh: megawatt hour (1,000 kilowatt hours (kWh). of its mines. affected by the organization’s activities, carbonization of coal to form coke. projects, such as a dam, motorway, airport or I products, and/or services; and whose actions factory, on the basis of Directive 85/337/EEC, Indirect Energy: primary source of energy used Mt: megatonnes (1Mt = 1,000,000 tonnes). PERSP 2015: or PERSPective 2015 is NWR’s can reasonably be expected to affect the ability COP 2010: NWR’s Coking Plant Optimisation as amended (known as ‘Environmental Impact by the company indirectly through the purchase programme to maximise the returns on our of the organization to succesfully implement its Programme, a capital investment programme Assessment’ – EIA Directive) or for public of electricity, heat, steam, nuclear energy and m3: cubic metres. recent investments in state of the art technology strategies. designed to improve the productivity of its coking plans or programmes on the basis of Directive other forms (non-renewable energy sources) and health and safety. The plan focuses on five operation. 2001/42/EC (known as ‘Strategic Environmental and solar, wind, geothermal, hydro energy, Materiality: disclosing all information of significant main areas: People, Efficiency, Reserves, Safety SO2: sulphur dioxide. Assessment’ – SEA Directive). The common biomassbased and hydrogen based energy concern to stakeholders for assessing our and Predictability. CRRP: or Comprehensive Rehabilitation and principle of both Directives is to ensure that (renewable energy sources). economic, environmental and social performance. T Reclamation Plan. The mining company is under plans, programmes and projects likely to have PM: particulate matter are tiny subdivisions of Tonne: a metric tonne, a measure of mass provisions of Act No. 44/1988 on the Protection significant effects on the environment are made IPPC: or Integrated Pollution Prevention and N solid matter suspended in a gas or liquid. Air equal to one thousand (1,000) kilogrammes and Utilisation of Mineral Resources (Czech subject to an environmental assessment, prior Control. The IPPC Directive (2008/1/EC of National Property Fund: National Property Fund of pollution can take the form of solid particulate or approximately two thousand, two hundred Republic) required to ensure the rehabilitation to their approval or authorisation. Consultation the European Parliament and of the Council the Czech Republic was created under provisions matter. and five (2,205) pounds. of the land affected by mining, including the with the public is a key feature of environmental of 15 January 2008) requires industrial and of Act 171/1991 Coll., on the competence of reclamation works. The CRRP addresses the assessment procedures. agricultural activities with a high pollution Czech Republic’s bodies in the matters of the R V landscaping efforts in their entirety and is the potential to have a permit. This permit can assignment of the state owned property to other Recycled water: recycled/reused water is water Voluntary employee turnover: the voluntary basic conceptual material for removing the EU: European Union. only be issued if certain environmental persons and on the Czech Republic’s National 1. that has been used at least twice in the same employee turnover is the total employee turnover consequences of mining. conditions are met, so that the companies Property Fund. It was created as a legal person process within the operation; 2. that has been rate minus forced departures (organisational F themselves bear responsibility for preventing for the technical realization of the privatization used in a different process within the same change), retirements and departures for health CSR: Corporate Social Responsibility. Flotation tailings: are a mixture of coal dust, and reducing any pollution they may cause. decision and an interim administration of operation; and 3. that has been used at another reasons. water, ash, clay or sand created during minerals state-owned shares to the gradual privatization. of the organisation’s facilities. CO: carbon monoxide. preparation. It is a material with a particle IPR: or Integrated Pollution Register, a publicly Activities of the National Property Fund of the W size of 0 to 0.5 mm and ash content accessible information system on chemical Czech Republic were completed in 2005. Red list: IUCN Red List of Threatened Species. Waste rock: or overburden are materials overlying

CO2: carbon dioxide. (non-combustible solid components) greater substances and their amounts released into an ore or mineral body that are displaced during than 60 per cent. It is created when coal the air, water and soil. Furthermore, it contains NATURA 2000: is an EU-wide network of nature Renewable energy: energy generated from mining without being processed. CSI: the NWR Group’s Corporate Social sludge is separated by flotation based on the information about the transfer of these protection areas established under the 1992 natural resources such as sunlight, wind, tides Investment comprises finances provided different physical and chemical properties of the substances in waste or wastewater. Habitats Directive. The aim of the network is to and geothermal heat, which are renewable for projects in the following areas: community surfaces of the particles being separated. assure the long-term survival of Europe’s most (naturally replenished). Overview Our approach Our people Environment Community Supply chain Additional information Notes

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Disclaimer and Cautionary Note on Forward Looking Statements and Notes on Certain Other Matters

Certain statements in this document are not historical facts and are or are deemed to be ‘forward-looking’. Although the Company has made every effort to assure the accuracy of the used information and believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. These forward-looking statements involve a number of factors, risks, uncertainties and other facts that may cause actual results to be materially different from those expressed or implied in these forward-looking statements. Forward-looking statements are not guarantees of future performances.

Forward-looking statements are made only as of the date of this document. The Company expressly disclaims any obligation or undertaking to release, publicly or otherwise, any updates or revisions to any forward-looking statement contained in this report to reflect any change in its expectations or any change in events, conditions, assumptions or circumstances on which any such statement is based unless so required by applicable law. New World Resources Plc c/o Hackwood Secretaries Limited One Silk Street London EC2Y 8HQ United Kingdom

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