Operations Communities Xstrata Nickel Dominican Republic DOMINICAN REPUBLIC HAITI CUBA JAMAICA Caribbean Sea Santo Domingo Falcondo Bonao Fa l co n d o Dominican Republic – Bonao For the past 40 years the Falcondo Operation has been contributing to the economy of the Dominican Republic. The town of Bonao lies 80 kilometers north of Santo Domingo, Dominican Republic, and is the home to Falcondo, our ferr onickel surface mining operation. Ferr onickel is a combination of ir on and nickel and is a crucial r esour ce to the stainless steel industry . Our facilities at Falcondo include a metallur gical tr eatment plant and a crude oil r efnery . Operations Xstrata, which owns 85.26% of the shar es in Falcondo, began pr oduction in the r egion in 1971. In July 1999, we became the frst ferr onickel facility in the world to be ISO 14001 certifed. Our Falcondo plant has seen a r ejuvenation despite facing tough economic hur dles. In August 2008, we made a decision to temporarily shut down operations to pr eserve value while nickel prices wer e low and oil prices wer e at a r ecor d high. W e took advantage of the downtime by making optimizations to our mining and pr oduction plant pr ocesses as well as signing a commer cial agr eement with a local power company for a supply of electricity , enabling us to operate with r educed costs. Our strategy paid of f, and in Mar ch 2011 we r estarted our Falcondo operations at 50% capacity . A pr oject to convert the long-ter m ener gy sour ce for our pr ocessing plant fr om oil to natural gas in underway and will enable us to operate at 100% pr oduction upon completion. A partner in the community While local infrastructur e has been signifcantly impr oved by the tax and dividend payments we pay to the Dominican Republic gover nment, we wanted to do mor e for the people in our community . In 1989, we established a non-pr oft foundation to encourage local development in health, education, envir onment and cultur e, as well as funding for pr ojects that manage and pr eserve natural r esour ces. Over the past 20 years, our Falcondo Foundation has invested mor e than $15 million in community development and has r efor ested mor e than 800 hectar es of land. In 2005, the Falcondo Foundation was named “corporate citizens of the Americas” by the Or ganization of States of America. One of our pr oudest achievements is the Centr o Educacional Bonao, a school started by our foundation. This independent private school that continues with our support has twice r eceived the impr essive Iber o-American prize as the best school in Latin America. Employees Falcondo employs 975 people at 50% pr oduction capacity . 2011 Pr oduction Rate • 13,498 tonnes nickel-in-ferr onickel Mineral Reserves As at December 31, 2011 Pr oven: 44.0 million tonnes grading 1.28% nickel Pr obable: 29.7 million tonnes grading 1.36% nickel Mineral Resour ces As at December 31, 2011 Inclusive of r eserves Measur ed: 40.2 million tonnes grading 1.45% nickel Indicated: 34.5 million tonnes grading 1.56% nickel Inferr ed: 4.9 million tonnes grading 1.4% nickel