COLOMBIAN COAL: OPPORTUNITIES TO INVEST

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Unidad de Planeación Minero Energética

COLOMBIAN COAL:

OPPORTUNITIES TO INVEST

September 2015

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MINING INSTITUTIONS IN COLOMBIA

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MINING INSTITUTIONS IN COLOMBIA

Regulatory Stability

Information

Infraestructure

Competitiveness

Confidence

L M

SU SM

Strenghened mining authority

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COLOMBIA IN GLOBAL COAL PRODUCTION

3,034 756 526 486 255 239 201 103 81 65

TOP 10 WORLD´S THERMAL COAL PRODUCERS, 2013 (MN TONNES)

In 2013, Colombia was the largest thermal coal producer in Latin America and the fifth biggest coal exporting country in the world. In 2014, after a 3.5% increase of the output, the country ranked as the fourth main global exporter of the mineral. According to the BPs Statistical Review of World Energy 2014, more than 46% of the proven coal reserves in Latin America are located in Colombia.

Source: EMIS

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PRODUCTION

‐ 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0

1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Historical Production ‐ Coal

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MINING TENEMENTS

54.60%

37.30%

2.70% 2.60% 2.00% 0.80%

Coal Production by Department, Jan ‐ Sept 2014

Cesar Guajira Cundinamarca

North Santander Boyacá Others

Open Mine: 92,3%

Underground: 7,7%

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COLOMBIA IN GLOBAL COAL PRODUCTION

423

182

118

47 73 72

4 3

154

22

60 1 0

33 0

50 100 150 200 250 300 350 400 450

Indonesia Australia Russia USA Colombia South Africa Canaá

MAIN COAL EXPORTING COUNTRIES, 2013 (MN TONNES)

Thermal Metallurgical

Source: EMIS

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COAL EXPORT

In 2014, the volume of coal and coke exports rose by 16%. However, in value terms the exports grew by just 1.8%, as a result of the drop in the global commodity prices. According to industry publication World Coal, the rise in exports was triggered by higher demand from Turkey (20.2% up from 2013) and the United Kingdom (up by 13.5%).

On the other hand, shipments to Colombia's largest coal export destination – the Netherlands, decreased by 23%, mainly due to the almost three‐month suspension of operations at the Drummond port between January and March 2014. The Colombian government ordered a temporary suspension of coal exports from the port because Drummond failed to install direct loaders by January 1, 2014 in order to decrease the pollution caused by coal loading and unloading activities.

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69.8 81.4 84.1 80.6 83.5

4.6

4.4 4.9 4.9 5.1

0 10 20 30 40 50 60 70 80 90 100

2010 2011 2012 2013 2014

MILLONES DE TONELADAS

Térmico Metalúrgico Otros Coal is the most important product of Colombia's mining sector, generating more than 80% of the government’s income from the sector, and the second most exported product of the country after crude oil. Since 2009, coal production has been growing at a compound annual growth rate of 4%, mainly due to the expansion of mining activities in the Guajira and Cesar departments. The coal industry is dominated by large producers that operate their own ports and railways such as Cerrejon, Drummond and Glencore. In 2014, the three companies accounted for 83% of the total coal production in the country.

Source: EMIS

PRODUCTION

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COLOMBIAN COAL SEAMS

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COAL RESERVES

Source: MME

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INFRAESTRUCTURE

BOGOTÁ

PAZ DEL RÍO

BUCARAMANGA PUERTO BOLIVAR

SANTA MARTA BARRANQUILLA

CARTAGENA

MORROSQUILLO

BUENAVENTURA

RIOHACHA RIOHACHA

VALLEDUPAR

CORDOBA

BOLIVAR

ANTIOQUIA

CHOCO

NORTE DE SANTANDER

VALLE DEL CAUCA

HUILA TOLIMA QUINDIO

RISARALDA CALDAS BOYACÁ

GUANIA

CONVENCIONES

VÍA FERREA PROYECTADA

RÍO MAGDALENA VÍA RUTA DEL SOL ORO

CARBON NIQUEL VÍA FERREA ACTUAL

CENTRO DE TRANSFERENCIA PROYECTOS PINES

RÍO MAGDALENA

FERROCARRIL DE UPAR

SISTEMA FERROVIARIO CENTRAL 1050 Km.

FENOCO 245 Km.

FFCC CERREJÓN 145 Km.

CONCESIÓN DEL PACIFICO 489 Km.

CORREDOR ALTIPLANO CUNDIBOYACENSE 297 Km.

CUPICA

CAPULCO

BOCAS DE CARARE

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感謝

COLOMBIAN COAL: OPPORTUNITIES TO INVEST

Thank You

Arigato