environmental performance

Alfred Phala, Xstrata Alloys Environmental Management team helper takes a water sample at the Project Lion site, South Africa

Currently targets are set at a commodity business level and in some cases at site level. Performance against the 2004 targets is found in the table on page 53, together with targets for 2005.

Xstrata incurred one environment-related fine in 2004, at the Ravensworth East coal mine in New South Wales, where a fine of AUD1,500 was imposed following the non-capture of two blasts in July 2003. No environment related prosecutions were enforced as a result.

Xstrata operations reported 825 environmental incidents during 2004, a marginal 2% increase on the previous year. There were 35 category three incidents and no category four or five Incidents. In summary, the category three incidents involved:

• 21 storm water releases;
• one release of diluted oil during storm;
• one concentrate spill to land;
• two seepage pond overflows;
• one concentrate spill at a port;
• one slimes release;
• three effluent pond releases;
• one event where underground water, pumped to the surface, was not contained on site;
• three dust emissions exceeded limits; and
• during start up a rotary kiln was not operated through the bag filter.

All incidents were investigated and remedial actions were put in place. In the longer term it is planned to increase storm water retention capacity to minimise storm water releases.

Definitions of the categories for environmental incidents are outlined in the glossary on page 84. Tables summarising the number of incidents and the Commodity Business breakdown are shown below:

water

Effective water management and conservation is critical to the long-term viability of many Xstrata operations, which are located in dry, remote areas. Xstrata's overall total water used in 2004 rose by 12% compared to 2003. In 2004 we adopted the Global Reporting Initiative water protocol definitions and together with improved measurement of water use this makes comparison with 2003 data difficult. The graph below indicates Xstrata's raw water use trend over the past three years. The incorporation of a number of large sites into the group in 2003 has contributed to the marked increase in water use since 2002.

Raw water use increased in 2003 due to the incorporation of a large number of sites into the group following the acquisition of MIM Holdings Limited. In 2004 we adopted the GRI water protocol definitions, making a direct comparison with the previous year difficult.