Corporate presentation nov 06 – mmx integrated...

CORPORATE PRESENTATION

NOVEMBER 2006

This presentation relating to MMX Mineração e Metálicos S.A. (“MMX”) includes “forward-looking statements”, as that term is defined in the Private Securities Litigation Reform Act of 1995, in Section 27A of the Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. All statements other than statements of historical facts are statements that could be deemed forward-looking statements and are often characterized by the use of words such as “projects”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, “may”, “will”, or “intends”, or by discussions or comments about our objectives, strategy, plans or intentions and results of operations. Forward-looking statements include projections regarding our operating capacity, operating expenditures, capital expenditures and start-up dates.

By their nature, these forward-looking statements involve numerous assumptions, uncertainties and opportunities, both general and specific. The risk exists that these statements may not be fulfilled or, even if they are fulfilled, the results or developments described in such statements may not be indicative of results or developments in future periods. We caution participants of this presentation not to place undue reliance on these forward-looking statements as a number of factors could cause future results to differ materially from these statements.

Forward-looking statements may be influenced in particular by factors such as the ability to obtain all required regulatory approvals on a timely basis or at all, exploration for mineral resources and reserves, difficulty in converting geological resources into mineral reserves, and changes in economic, political and regulatory conditions. We caution that the foregoing list is not exhaustive. When relying on forward-looking statements to make decisions, investors should carefully consider these factors as well as other uncertainties and events.

MMX does not undertake to update our forward-looking statements unless required by law. This presentation is neither an offer to sell (which can only be made pursuant to definitive offering documents) nor a solicitation of an offer to buy any securities in the United States, or any other jurisdiction. The securities referred to herein have not been registered in any jurisdiction, and in particular, will not be registered under the U.S. Securities Act of 1933, as amended, or any applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.

This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without MMX’s prior written consent.

Investor Relations

Rodolfo Landim – Investor Relations Officer

Elizabeth Cruz – Manager

Gina Pinto - Analyst

Tel. 55 21 2555-5634 / 5558/ 5563

[email protected]

http://www.mmx.com.br/ri

DISCLAIMER

Iron Ore Fines: 6.5 MtpyPig Iron: 2.0 MtpySemi-finished: 0.5 Mtpy

Iron Ore: 4.9 MtpyPig Iron: 0.4 MtpySemi-finished: 0.5 Mtpy

Natural ReserveEngineer Eliezer Batista

MMX Amapá System

MMX Minas-Rio System

MMX Corumbá System

Iron Ore: 26.6 MtpyPellets: 7.0 Mtpy

COMPANY PROFILE MMX INTEGRATED SYSTEMS

MMX Integrated Systems develop and operate iron

ore mines, pig iron and semi-finished plants and a

pelletizing plant.

1

COMPANY OVERVIEWCOMPANY PROFILE

2

� MMX was created by a team of mining specialists led by Eike Batista

� Experienced management team

� Majority of members of the Board of Directors are independent

� Independent Audit Committee

� Focus on iron ore provided by high-quality products

� Integrated mining operations and metallic plants connected to independent

logistics, structured in self-sufficient systems

� Health, safety, environmental and social responsibility

� Listed in the Novo Mercado - BOVESPA

22 Former Business Development Director of CVRD – 4 years

33 Former CVRD Group Northern System Director – 24 years

44 Former President of CVRD International – 22 years

55 Former Banco Boavista and Brasil Telecom

66 9 years working in EBX Group

77 Former CFO of Unisys Brasil and Unisys Germany

Dalton NoséMetallics Officer

Joaquim MartinoMining Officer

Ricardo AntunesCommercial/Develop.

Officer

Paulo GouvêaLegal Officer

Rudolph IhnsCFO

Special Advisors:

Flavio GodinhoMarcelo Cheniaux

22 33 44 55 66 77Adriano Vaz

Administrative/HSECOfficer

Eike BatistaChairman & CEO

Rodolfo LandimExecutive President

& IR Officer

11

11 Former CEO of BR Distribuidora (Petrobras) – 26 years

COMPANY PROFILE EXPERIENCED MANAGEMENT TEAM

� Samir Zraick

� Carlos José da Silva Azevedo

� Rivadávia Carsalade Herbster Gusmão

3

Audit Commitee

Eike Batista – Brazilian Mining Entrepreneur

Michael Stephen Vitton – Managing Officer of Nesbitt Burns (BMO)

Eliezer Batista – Former CEO of CVRD (VALE5), former Minister of Mines and Energy

Gilberto Sayão – Partner and Managing Officer of Banco Pactual

Hans Mende – Officer and Partner of AMCI Group (Foundation Coal - FCL and Alpha Natural Resources - ANR)

José Luiz Alqueres – Former President of Eletrobrás (ELET6), Chairman of Alstom Brasil and CEO of Light

Peter Nathanial – Managing Officer of Citigroup (C) (Global Risk Oversight, Investments and Country Risk)

Raphael de Almeida Magalhães – Former Minister of Social Security

Samir Zraick – Former CFO of CVRD (VALE5), Board member of Embraer (EMBR4)

Amaury Temporal – Director of FIRJAN Intl. Business Center, Board member of ACRJ

Special Advisor:

BOARD OF DIRECTORSCOMPANY PROFILE

Independent Members:

4

MMXMetálicos

MMXCorumbá

COMPANY PROFILE CORPORATE STRUCTURE

Term Sheet signed with Cleveland Cliffs for the purchase of 30% stake in MMX

Amapá for US$ 133 million (approximately 39% premium over IPO value).

Centennial Asset is negotiating with strategic partners its 30% stake interest in

MMX Corumbá and MMX Minas-Rio Systems.

5

70% 100%70% 70%

MMXAmapá

(Mine+Railway+Port)

MMXMinas-Rio

(Mine+Pipeline+Port)

IPO at the BOVESPA – July/2006

Largest offering held in Brazil then

(US$ terms)

COMPANY PROFILE MMXM3 IN NOVO MERCADO - BOVESPA

� Successful IPO

� R$ 1,119 million (US$ 509 million)

� 1,373,000 subscribed shares

� Free float 32% of capital, 91% foreign-held

� TSX follow-on listing expected by year-end

6

COMPANY PROFILE

Listing in Canada – Toronto Stock Exchange:

� Auditing of MMX Systems´ resources and mineral reserves under way – Canadian

Standard NI-43.101 – disclosure is expected for December 06;

� 3Q06 USGAAP Financial Statements to be reported in December;

� Level I Global Depositary Receipts (GDR) Program filed with the CVM in October 2006 -

GDR per Common Share ratio of 40:1 - estimated GDR CAD$10.55 (Nov 9 prices).

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STOCK MARKET INFORMATION

Date Ratio

January 2007 2 → 1 share

July 2007 2 → 1 share

January 2008 10 → 1 share

Stock Split Program

(1) Negotiation started on July 24(2) As of November 9(3) In US$ millions

Stock Trading Evolution (2006)

MMXM3 = price per share, minimum lot of 100 shares.

Price Number of Volume Market(US$) Trades Traded (3) Cap. (3)

July (1) 377 112 31.6 1,433 August 381 20 38.1 1,449 September 375 44 3.9 1,426 October 373 38 4.6 1,420 November (2) 374 42 14.5 1,421

Vertically Integrated High Value-Added Projects

2010

Start-up Pellet PlantMinas-Rio System

2003 2004 2005

Asset acquisition

Start-up CorumbáMine

2009

Start-up Minas -Rio System

Start-up MiniMill Amapá

2006

AmapáRailwayConcession

2008

Start-up MiniMill Corumbá

Start-up PigIron Amapá

Start-upPig Iron Corumbá

2007

Start-upAmapá Mine

Engineering; beginning of drilling

2011

Production of iron ore (Mt)

Production of pig iron (Mt)

14

9

19

3137

0.2 0.7 1.3 1.5 1.5Production of semi-finished (Mt) 0.1 0.5 1.0 1.0

OPERATIONAL STATUS MMX PROJECTS TIMELINE

8

OPERATIONAL STATUS

Permitting progress:

� MMX Corumbá System:

- Mine currently operating under Federal Environmental License;

- Construction License granted for pig iron plant, construction of blast furnaces initiated inSeptember.

� MMX Amapá System:

- Mine Construction License granted, leveling and dam works to be completed by December 2006, 100% of key equipment for the operation under contract with firm delivery dates;

- Railway Operating License granted, progress in equipment and railway repairs;

- Santana Port – Preliminary Environmental License granted, construction to begin at 1Q07.

� MMX Minas-Rio System:

�� Iron ore Pipeline:

- Environmental impact study in approval process by IBAMA, Preliminary License expected for

1Q07;

- Detailed topography concluded, right of way to be concluded in mid 2007.

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MMX SYSTEMS EVOLUTION

MMX Systems

CorumbáMine and processingPig Iron MillMini Mill

AmapáMine and processingPortPig Iron MillMini Mill

Minas-RioMine and processingPipelinePortPellet Plant

2005 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q220102006 2007 2008 2009

Preliminary License – approves project studiesConstruction License – authorizes infra-structure works

PERMIT GRANTED

PERMIT EXPECTED

Operational Start-up

OPERATIONAL STATUS ENVIRONMENTAL PERMITTING TIMELINE

10

OPERATIONAL STATUS CAPEX DISBURSEMENT TIMETABLE

� As of September 2006, expenditure of US$ 64.5 million.

� Disbursement timetable under review, payments carried over to 2007 (approximately US$129 million).

11

CAPEX – By System (US$ million)

254

828995

283

2,377

54

330

543

297

1,225

2006 2007 2008 2009 - 2013 Total (*)

Mine & logistics Metallics

(*) includes 2005 figures

CAPEX – By Activity (US$ million)2006 2007 2008 2009 - 2013 Total (*)

Corumbá 88 93 23 - 220 Mine 42 13 - - 72 Metallics 46 80 23 - 148

Amapá 87 294 382 153 915 Mine 60 54 38 - 152 Logistics 21 59 40 - 120 Metallics 5 181 304 153 643

Minas-Rio 134 772 1,133 427 2,466 Mine 100 282 348 241 971 Logistics 31 420 569 42 1,062 Pellet Plant 3 70 216 144 433

Total 308 1,158 1,538 580 3,602

US$ millionUS$ million

Status (1)Status

US$50 mmBridge Loan

-

-

Disbursed

Firm CommitmentUS$ 50 mmBridge Loan

OPERATIONAL STATUS FINANCING

2,378

72

273

2,033

1,224

148

643

433

3,602TOTAL

Metallics

Corumbá

Amapá

Minas-Rio (Pellet Plant)

Mine

Corumbá

Amapá

Minas-Rio

CAPEXProject Financing (1)

1,744

26

200

1,518

2,729

985

150

510

325

ABC/Unibanco/Itaú BBA/BNDES

Itaú BBA, ABC

Unibanco/Syndicate/BNDES

Lenders

Credit Suisse

Itaú BBA/BNDES

Itaú BBA/BNDES

Term

3 years

7/10 years

12 years

7 years

10 years

10 years

Financing in progress to carry out execution of Business Plan

12

(1) Expected Weighted Average Cost of Borrowing: Libor + 1,5%, assuming 50% funding by BNDES.

� High quality lump iron ore in Mine 63 – lump (85%) and sinter feed (15%)

� MMX expects to produce metals at competitive cash costs

� Proven logistics in place

RESOURCES CORUMBÁPROJECT

AREAAreaResource

Classification Tonnage (MT)

Indicated 65

� MMX is currently undertaking a geologic research with shafts and a drilling campaign with 3 drill rigs

� Drilling and excavation performed: 2,652 meters as of October 2006, 43% of drilling campaign

� Planned drilling increased to 6,102 meters to be concluded in March, 2007

� Of the 21 mining rights, 3 were researched as of September 2006 (2 measured)

Paraguai River

Corumbá

San Nicolas

2022 k

m

MMX Mines 63

Railroad

Integrated Semi-Finished Plant

Corumbá

PortoLadário

20km Barge transportation by the Paraguay River waterway

San Nicolas Port

Capable of receiving

Panamax vessels

15km

Mine 63

TOTAL 65

MMX CORUMBÁ SYSTEM CORUMBÁ SYSTEM

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GEOLOGICAL RESOURCES – as of March 31, 2006

Start-upPig Iron Corumbá


20102003 2004 2005

Asset acquisitions

Start-up CorumbáMine

20092006 2008

Start-up MiniMill Corumbá

2007


2011



0.73.3

4.9

0.2 0.4Production of semi-finished (Mt) 0.1 0.5

OPERATIONAL STATUS MMX CORUMBÁ TIMELINE

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4.9 4.9

0.5

4.9

0.5

Note: In 2008 Corumbá System reaches full pig iron capacity production of 0.4 Mt, which will be used to feed the semi-finished plant.

Construction License for Pig Iron Mill

MMX CORUMBÁ SYSTEM ENVIRONMENTAL RESPONSABILITY

Photo: Amolar Region, where Eliezer Batista Natural Reserve is located. 15

INDUSTRIAL PLANT – MINE 63MMX CORUMBÁ SYSTEM

16

PIG IRON PLANT CONSTRUCTION MMX CORUMBÁ SYSTEM

17

EUCALYPTUS PLANTATION MMX CORUMBÁ SYSTEM

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� More than 370 million tonnes of iron ore resources as of March 2006

� 20-year supply contract with GIIC (Gulf Industrial Investment Co.) – already signed

� Aggressive drilling campaign, on a 200m x 50m grid

� Existing logistics in place, including operating railway

� Capacity to export 6.5 Mtpy of high-grade sinter and pellet feed in capesize vessels, through

transshipping

� Tax incentives available, reducing income tax by 75% for 10 years of operation

� MMX is currently undertaking a drilling campaign with 8 drill rigs

� Drilling performed: 25,827 meters as of October 2006, 80% of drilling campaign

� Planned drilling: 32,180 meters to be concluded in March 2007� Of the 18 mining rights, 3 were researched and measured

MMX AMAPÁ SYSTEM AMAPÁ SYSTEM


AREAArea Resource Classification

Tonnage (MT)

IndicatedInferred

220155

Taboca andVila do Meio

TOTAL 375

19


MMX Mine

Santana Port

Pig IronMini-Mill Plant

200km

EFA Railway

AMAPÁCapable of receiving

Capesize vessels

Santana Port


20102003 2004 2005

Asset acquisitions

2009

Start-up MiniMill Amapá

2006

AmapáRailwayConcession

2008

Start-up PigIron Amapá

2007

Start-upAmapá Mine


2011



0.84.3

6.5 6.5 6.5

0.3 1.31.5 1.5

Production of semi-finished (Mt) 0.5

OPERATIONAL STATUS MMX AMAPÁ TIMELINE

20

0.1 0.5

Note: In 2010 Amapá System reaches full pig iron capacity production of 2 Mt. Part of this output will be used to feed the semi-finishedplant.

ConstructionLicense for Amapá Mine

PreliminaryLicense for Santana Port

MMX AMAPÁ SYSTEM

21

TABOCA HEADQUARTERS

MMX AMAPÁ SYSTEM CONSTRUCTION PROGRESS

22

� MMX is currently undertaking a drilling campaign with 14 drill rigs

� Drilling performed: 18,927 meters as of October 2006, 67% of drilling campaign

� Planned drilling: 28,274 meters to be concluded in March 2007

� Of the 27 mining rights, 9 were researched as of September 2006 (5 measured)

Açu Port

MMX Mines

550 K

m

Açu Port

Steel Plant

Connecting MMX Mines to Açu Port

Process Area, FilteringArea and Steel Plant

Capable of receiving capesize vessels

Açu Port

Steel Plant

MMX MINAS-RIO SYSTEM MINAS-RIO SYSTEM

� The MMX Minas-Rio System integrates world-class iron ore deposits with a port via a 26.6 Mtpy pipeline

� MMX has acquired high-grade iron ore properties in Minas Gerais with 0.7 billion tons of resources as of

March 2006

� MMX has also acquired an extensive port area of 1,900 hectares, enough to accommodate a 7 Mtpy

pelletizing plant


AREA


Area Resource Classification

Tonnage (MT)

Indicated Inferred

408159Itapanhoacanga

TOTAL 567

Inferred 147João Monlevade

TOTAL 714

MMX Pipeline

Storage Piles

AdministrativeServices

23

Beginning of pipeline, port and pellet plant construction

Start-up Pellet PlantMinas-Rio System


20102003 2004 2005

Asset acquisitions

2009

Start-up Minas -Rio System

2006 20082007

Beginning of drilling

2011


Production of pellet (Mt)

8.0

20.0

26.6

OPERATIONAL STATUS MMX MINAS-RIO TIMELINE

24

Engineering and drilling of new areas

3.0

7.0

Note: Beginning in 2010, part of the iron ore production will be used to feed the pellet plant.

ITAPANHOACANGA AND SERRA DO SAPO AIRVIEWMMX MINAS-RIO SYSTEM

25

AÇU SUPER PORTMMX MINAS-RIO SYSTEM

26

High value-added projects, vertically

integrated

High qualityproducts

Low production cost at

competitive capital

expenditure levels

Long term supply

relationships

Integrated and independent

logistics

MULTIPLYING VALUE

Health, Safety, Environmental

and Social Responsibility

COMPANY PROFILE

27

Corporate presentation nov 06 – mmx integrated...

Business

mtpy pig iron

securities act

statements of historical

mtpy semifinished

securities exchangeact

mtpymmx corumb system

results of operations

future results