CONTRACTOR MANAGEMENT AT XSTRATA COAL

1. CONTRACTOR MANAGEMENT AT XSTRATA COAL

2. INDEX • Location of sites • Employees vs. Contractors • Contractor selection phase • Pre-engagement operational phase • Engagement operational phase • Post engagement / project completion phase • Completion stage • Common problems experienced • Future initiatives

3. Location of sites Waterpan Boschmans Witcons South Witbank Goedgevonden Tweefontein Division Middelburg Witbank Phoenix Tavistock ATC ATCOM iMpunzi Division Ogies Mpumalanga Division Tselentis Spitzkop DTJV - Middelburg DTJV - Douglas Rietspruit

4. Employees vs. Contractors

5. Employees vs. Contractors • Injuries • Strength Contractors contribute to 31% of the total number of injuries

6. Management Of Contractors CONTRACTOR SELECTION PHASE CONTRACTOR SELECTION PHASE PRE-ENGADGEMENT OPERATIONAL PHASE OPERATIONAL PHASE The company Preparation Completion of all documentation Including contract, indemnities, returns, etc Attendance at HS and Operational Meetings Evaluation criteria Over inspection / Monitoring / Auditing Tender Assessment in accordance with Company Procedure Completion of pre-emptive risk identification and assessment Assessment and response to pre-emptive risk identification and assessment by the company. POST-ENGADGEMENT OPERATIONAL PHASE Selection / Rejection Review contractual performance / delivery of services Induction / Training Medical Examination (certificate of fitness and medical surveillance) Review compliance with obligations

7. Contractor Selection Phase • Need for contractor employment identified • Scope of work defined • Evaluation criteria • Tender assessment – company procedure • Company actions • Selection

8. Pre-engagement / Operational Phase • Documentation, i.e. contract, indemnities, appointments, etc • Pre-emptive risk identification & assessment • Response to risk identification & assessment • Induction training • Medical examination (C.O.F. & medical surveillance)

9. Engagement / Operational Phase • Monitoring performance, i.e.: • H&S Meetings • Risk management programme • Occupational hygiene controls monitored • Incident / injury reports • Daily, weekly, monthly returns submitted • First aid programme • Induction • Medical surveillance • Health & safety training programme

10. Engagement / Operational Phase • Issue & control of PPE • Equipment inventory • Logbooks, registers, appointments • Fire drills • Emergency preparedness / escape routes • Vehicle / equipment pre-use checks • Planned task observations • H & S Audits • Hazardous substances • Maintenance management

11. Engagement / Operational Phase • OEM training / authorisation procedure • Approval of deviations / modifications to equipment • Approval – temporary workers • Approval – contract variation orders • Non-compliances • Special precautions for hazardous work

12. Post-Engagement / Project Completion Phase Review of contractual performance Delivery of service Quality assurance Review of compliance with obligations Cold commissioning of system Hot commissioning of system Warranty and maintenance period confirmed Contractor documentation Security cards returned

13. Post-Engagement / Project Completion Phase • Exit medical examinations • Equipment removal • Site area cleared, clean & safe • Acceptance of ownership

14. Common Problems experience • Limitation on the number of specialist contractors in the market • Time restraints in selection and appointment process • Quality of contractors supervisors and employees • Record keeping on the movement of contractors employees between mines • Desertion of contractors employee without completing exit medical examinations

15. Future initiatives • Preferred contactors list • Electronic data base with program to generate tender documents