Oxiana and Zinifex merger
Strength — Diversity — Growth March 2008
Page 1 Important notice
The purpose of this material is to provide general information about the proposed transaction between Oxiana Limited (“Oxiana”) and Zinifex Limited (“Zinifex”). This material is not and does not constitute an offer, invitation or recommendation to subscribe for, or purchase any shares. Neither this material nor anything contained in it shall form the basis of any contract or commitment.
Reliance should not be placed on the information or opinions contained in this material. This material does not take into consideration the investment objectives, financial situation or particular needs of any particular investor. Any decision to purchase or subscribe for shares should only be made after undertaking an independent assessment and determination as to the information to be contained in the Scheme Booklet to be subsequently issued and after seeking appropriate financial advice.
No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this material. To the maximum extent permitted by law, Oxiana, Zinifex and their affiliates and related bodies corporate, and their respective officers, directors, employees, agents and advisers disclaim any liability (including, without limitation any liability arising from fault or negligence) for any loss or damage arising from any use of this material or its contents, including any error or omission therefrom, or otherwise arising in connection with it.
Any forecasts and other forward-looking statements set out in this material are based on a number of estimates, assumptions and pro forma adjustments that are subject to business, economic and competitive uncertainties and contingencies, with respect to future business decisions, which are subject to change and in many cases outside the control of Oxiana and Zinifex. Any forecasts contained in this material may vary from actual financial results, and these variations may be material and, accordingly, neither Company nor their Directors can give any assurance that the forecast performance in any forecasts or any forward-looking statement contained in this material will be achieved. Neither Company undertakes to revise the material to reflect any future events or circumstances.
This material may not be lawfully published in some jurisdictions or may only be provided to certain persons and you must not view this material if to do so would be unlawful in your jurisdiction or may otherwise place either Company under obligations which it hasnot complied with.
All figures are expressed in Australian dollars unless stated otherwise.
Page 2 Presenters
Mr Owen Hegarty Mr Andrew Michelmore
Chief Executive Officer and Chief Executive Officer and Managing Director Managing Director Oxiana Zinifex
Page 3 Agenda
1. OPENING REMARKS 5
2. MERGER SUMMARY 6
3. TRANSACTION RATIONALE 7
4. QUESTIONS & ANSWERS
Page 4 1 Building a platform for growth
Combined vision to build a major diversified mining company
A true 50 / 50 “merger of equals”—equal sharing of benefits
Zinifex Scheme of Arrangement—3.1931 Oxiana shares per Zinifex share
Combines two highly complementary asset portfolios, growth profiles, cash flow and balance sheet profiles, market positions and management teams
Strategically positioned to capture continued strong demand growth
Financial strength and management capability to accelerate growth
Page 5 2 Merger summary
Merger terms ♦ 3.1931 Oxiana shares for every Zinifex share
Ownership ♦ Oxiana 50% / Zinifex 50%
Structure ♦ Merger unanimously recommended by both Boards ♦ Implemented via Zinifex Scheme of Arrangement ♦ Approximately 3,101 million shares outstanding upon completion ♦ Mutual break fee of $55 million
Company name ♦ New name for the combined entity to be determined and headquarters ♦ Corporate headquarters in Melbourne Conditions ♦ Zinifex shareholder vote (75% of shares voted and 50% of shareholders voting) ♦ Other customary conditions and Court approval
Indicative ♦ Scheme Booklet dispatched—April 2008 / May 2008 timetable ♦ Zinifex shareholder vote—May 2008 / June 2008
Page 6 3 Creating a major diversified mining company
A strong platform to deliver superior growth
A Enhanced market position B Complementary portfolios C High quality assets D A diversified company E Strong cash flows and balance sheet F Sustainable demand for commodities G Strategic focus H Strong and complementary development pipeline I Experienced Board and management team
Page 7 A Enhanced market position Top 25 ASX company and 3rd largest Australian diversified mining company
S&P/ASX 200 (Resources companies¹) Global mining peers
* BHP Billiton 209.3 Grupo Mexico 19.3
* Rio Tinto 160.5 Teck Cominco 18.6
Fortescue Metals 22.0 Antofagasta 17.0 Newcrest 17.3 Vedanta 13.4 * Combined 11.6 Combined 11.6 Lihir Gold 8.3 First Quantum 6.8 Alumina 7.3 Oxiana 6.1 Oxiana 6.1 Zinifex 5.4 Zinifex 5.4 Ivanhoe 5.3 Aquarius Platinum 4.2 Inmet 4.5 Paladin Energy 3.8 Mount Gibson 2.8 Lundin 3.6 Kagara Zinc 1.1 Equinox 3.5 Independence 1.1 HudBay 2.6
0 10203040506070150 200 250 0 5 10 15 20 25
(A$ billion market capitalisation) (A$ billion market capitalisation)
Source: Bloomberg and Datastream as at 29 February 2008 Note: 1. * Denotes diversified mining companies
Page 8 B Complementary portfolios Complementary asset portfolios with leverage to continued global growth
Operations
Australia 1. Century (zinc/lead) 2. Golden Grove (zinc/copper/gold/silver) 3. Rosebery (zinc/lead/copper/gold/silver) Laos 10 11 4. Sepon Copper (copper) 5. Sepon Gold (gold)
Projects under development
Australia 6. Prominent Hill (copper/gold) 8 12 4 5 Indonesia
7 7. Martabe (gold/silver) Laos
1 9 8. Sepon Copper expansion (copper) 2 6 Project pipeline 3 Australia 9. Dugald River (zinc/lead/silver) Oxiana assets Canada Zinifex assets 10. High Lake (zinc/copper) Oxiana exploration focus 11. Izok Lake (zinc/copper) Zinifex exploration focus Laos 12. Sepon Gold expansion (gold)
Page 9 C High quality assets Diversified portfolio with attractive asset characteristics
Significant scale – World’s second largest zinc producer by mine production – 200kt pa copper producer post Prominent Hill
High grade mines – High quality / low impurities concentrate – Copper cathode production at Sepon
Long mine life – Significant reserve and resource base – Further exploration upside
Cost competitive – Large scale zinc and copper producer with competitive cost position
Page 10 D A diversified company Broader operational and geographic footprint provides stability
20071 gross revenue by metal2 Silver Copper Copper Gold Copper 4% 1% 53% Zinc 1% 23% 30% Lead Prominent Hill 7% development Silver 4% Lead Gold 4% Zinc 5% + = 63% Gold Lead Silver 10% Zinc 6% 4% 87% 20071 gross revenue by geography Laos 22%
Laos Indonesia and 55% Canada Australia + = 45% Australia Australia 100% 78% Oxiana Zinifex Combined
Note: 1. Pro forma for the year ended 31 December 2007 2. Zinifex revenue split based on production for the year ended 31 December 2007 multiplied by average London Metal Exchange and Comex metals prices for the equivalent period
Page 11 E Strong cash flows and balance sheet Financial strength to support growth strategy
Combined pro forma EBITDA of $1,666 million for 2007¹
Combined pro forma NPAT of $918 million for 2007¹
Combined cash on hand of $2,474 million as at 31 December 2007
Combined interest-bearing debt of $539 million as at 31 December 2007
Combined net cash balance of $1,935 million as at 31 December 2007
Source: Company financial reports Note: 1. For the year ended 31 December 2007. Based on continuing operations for Zinifex
Page 12 F Sustainable demand for commodities
Well positioned to capture continued strong global growth in demand
Market fundamentals remain attractive
Growth in China remains robust
– Supported by increasing growth from India, Brazil, Russia and the rest of Asia
Comparative copper intensity Comparative zinc intensity
12 12 10 10 8 8 6 6 4 4 2 2 kg/capita/annum kg/capita/annum 0 0 1998 2006 1998 2006 Japan Korea China Japan Korea China Source: Broker research Source: Broker research
Page 13 G Strategic focus
Pursue the shared vision of becoming a major global diversified mining company, with growing, competitive and sustainable operations
Maintain and grow the core base and precious metals businesses and increasingly diversify the operations across different commodities and geographies
Leverage the combined financial strength and management capability to capture the opportunity set presented in the global commodities market
Generate superior sustainable growth in shareholder value
Maintain the highest standards for health, safety, environment and community
Page 14 H Strong and complementary development pipeline
The combined company is well positioned to deliver superior growth
Prominent Hill Martabe Rosebery Copper / gold Gold / silver Upgrade project project
Sepon Copper Prominent Hill Izok Lake Prominent Hill Copper expansion UG expansion Zinc / copper UG expansion Stage 1 Stage 2
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Golden Grove Sepon Gold Dugald River Golden Grove High Lake Oxide pit Primary gold Zinc / lead / silver Copper sulphide Zinc / copper project pit
Selective acquisition strategy to accelerate growth
Oxiana project Zinifex project
Page 15 I Experienced Board and management team
Highly experienced Board Board of Directors and CEO
Innovative and experienced management team Barry Cusack, Chairman
Extensive global and domestic mining expertise Combination of two individual Boards Proven track record in operating global assets Andrew Michelmore, Chief Executive Officer and implementing development projects and Managing Director A history of delivering long term growth Owen Hegarty, Non-Executive Director and Chairman of the Board Integration Committee All Oxiana and Zinifex directors invited to join the Board Senior management Senior management will be drawn from existing Andrew Michelmore, Chief Executive Officer management teams and Managing Director
– Limited overlap of roles given complementary “Resourced to grow” operations
Page 16 Oxiana and Zinifex merger
Strength — Diversity — Growth
Page 17 APPENDIX A
Pro-forma overview1
Note: 1. Excludes impact of Allegiance Page 18 Pro forma reserves & resources
Reserves1 Resources 1, 2 Oxiana Zinifex Combined Oxiana Zinifex Combined
Zinc (Kt) 606.0 5,629.0 6,235.0 Zinc (Kt) 1,196.2 16,611.4 17,807.6
Copper (Kt) 1,862.7 15.3 1,878.0 Copper (Kt) 4,002.6 813.1 4,815.7
Gold (Moz) 4.1 0.2 4.3 Gold (Moz) 14.3 1.7 16.0
Silver (Moz) 52.1 51.3 103.4 Silver (Moz) 153.2 254.6 407.8
Nickel (Kt) - - - Nickel (Kt) 620.0 - 620.0
Lead (Kt) 66.0 630.4 696.4 Lead (Kt) 130.8 2,468.3 2,599.1
Cobalt (Kt) - - - Cobalt (Kt) 47.0 - 47.0
Notes: 1. 100% basis, contained metal 2. Resources are inclusive of reserves
Page 19 Pro forma financials & production
Pro forma financials (2007 calendar year) Oxiana Zinifex1 Combined Gross revenue ($m) 1,196.3 1,638.5 2,834.8 EBITDA ($m) 595.1 1,071.4 1,666.5 NPAT ($m) 305.8 612.2 918.0 Cash on hand ($m) 246.1 2,228.0 2,474.1 Interest-bearing debt ($m) 420.8 118.1 538.9
Notes: 1. Sum of reported results for second half 2006/7 and first half 2007/8 based on continuing operations
Pro forma production (2007 calendar year)1 Oxiana Zinifex Combined Zinc (Kt) 132.0 611.0 743.0 Copper (Kt) 77.9 1.7 79.6 Lead (Kt) 8.1 65.3 73.4 Gold (Koz) 151.2 31.8 183.0 Silver (Koz) 3,310.0 6,951.2 10,261.2
Note: 1. 100% basis
Page 20 APPENDIX B
Asset overviews
Page 21 Century (Zinifex)
Location Overview
Location Queensland, Australia
Ownership 100%
Reserves 46.2Mt @ 11.2% Zn, 1.1% Pb, 25.0g/t Ag
Resources1 54.6Mt @ 12.5% Zn, 1.4% Pb, 34.1g/t Ag
CY2007A 527 Kt Zn production 44 Kt Pb 4 Moz Ag
Estimated mine 7+ years life
Note: 1. Measured, indicated and inferred
Century
Page 22 Golden Grove (Oxiana)
Location Overview
Location Western Australia, Australia
Ownership 100%
Reserves 9.9Mt @ 2.0% Cu, 6.1% Zn, 0.7% Pb, 0.9g/t Au, 46.2g/t Ag
Resources1 29.8Mt @ 1.9% Cu, 4.0% Zn, 0.4% Pb, 0.8g/t Au, 40.6g/t Ag
CY2007A 132 Kt Zn production 15 Kt Cu 8 Kt Pb 49 Koz Au 3 Moz Ag
Estimated mine 7+ years life
Note: 1. Measured, indicated and inferred Golden Grove
Page 23 Rosebery (Zinifex)
Location Overview
Location Tasmania, Australia
Ownership 100%
Reserves 3.8Mt @ 11.9% Zn, 3.2% Pb, 115.0g/t Ag, 1.7g/t Au, 0.4% Cu
Resources1 12.8Mt @ 12.1% Zn, 3.6% Pb, 135.2g/t Ag, 1.8g/t Au, 0.4% Cu
CY2007A 84 Kt Zn production 22 Kt Pb 3 Moz Ag 31 Koz Au 2 Kt Cu
Estimated mine 12+ years life
Note: 1. Measured, indicated and inferred Rosebery
Page 24 Sepon (Oxiana)
Location Overview
Location Sepon, Laos
Ownership¹ 90%
Reserves Sepon Gold: 3.9Mt @ 1.6g/t Au, 2.8g/t Ag Sepon Copper: 17.1Mt @ 4.6% Cu
Resources2 Sepon Gold: 60.2Mt @ 1.8g/t Au, 6.4g/t Ag Sepon Copper: 67.5Mt @ 2.4% Cu, 12.0g/t Ag
CY2007A 102 Koz Au production 145 Koz Ag 63 Kt Cu
Estimated mine Sepon Gold: 2+ years life Sepon Copper: 10+ years
Notes: 1. 10% owned by Government of Laos; figures shown on 100% basis 2. Measured, indicated and inferred
Sepon, Laos
Page 25 Prominent Hill (Oxiana)
Location Overview
Location South Australia, Australia
Ownership 100%
Reserves 68.8Mt @ 1.3% Cu, 0.6g/ Au, 3.2g/t Ag
Resources1 Copper/Gold: 152.8Mt @ 1.2% Cu, 0.5g/t Au, 2.9g/t Ag Gold Only: 38.2Mt @ 1.1g/t Au, 1.2 g/t Ag
Expected first Second half 2008 production
CY2008E 25 Kt Cu production 15 Koz Au 75 Koz Ag
CY2009E 117 Kt Cu production 86 Koz Au 390 Koz Ag
Prominent Hill Estimated mine 10 years for Stage 1 open pit. Underground expansion life capable of supporting significant additional mine life
Estimated $1.1 billion capital costs
Note: 1. Measured, indicated and inferred
Page 26 Martabe (Oxiana)
Location Overview
Location North Sumatra, Indonesia
Ownership 100%1
Reserves 37.7Mt @ 1.9g/t Au, 24.9g/t Ag
Resources2 138.2Mt @ 1.3g/t Au, 13.5g/t Ag
Project status Approved
Expected first 2010 production
Estimated 200 Koz Au production 2 Moz Ag
Estimated mine 9 year initial mine life life
Estimated US$310 million capital costs
Notes: 1. 5% held in trust for local Indonesian stakeholders; figures shown on 100% basis Martabe, 2. Measured, indicated, inferred Indonesia
Page 27 Dugald River (Zinifex)
Location Overview
Location Queensland, Australia
Ownership 100%
Reserves na
Resources1 47.9Mt @ 12.1% Zn, 2.1% Pb, 44.0g/t Ag
Project status Development
Expected first 2011 production
Estimated mine 15+ years life
Note: 1. Measured, indicated and inferred
Dugald River
Page 28 High Lake (Zinifex)
Location Overview
Location Nunavut, Canada
Ownership 100%
Reserves na
Resources1 17.3Mt @ 3.4% Zn, 0.3% Pb, 70.1g/t Ag, 1.0g/t Au, 2.3% Cu
Project status Development
Expected first 2016 production
Estimated mine 12+ years life
Note: 1. Measured, indicated and inferred
High Lake
Page 29 Izok Lake (Zinifex)
Location Overview
Location Nunavut, Canada
Ownership 100%
Reserves na
Resources1 14.8Mt @ 12.7% Zn, 1.3% Pb, 70.5g/t Ag, 2.5% Cu
Project status Development
Expected first 2014 production
Estimated mine 10+ years life
Note: 1. Measured, indicated and inferred
Izok Lake
Page 30