GUIDELINES TO HOT HOLE DRILLING AND BLASTING

1. GUIDELINES TO HOT HOLE DRILLING AND BLASTING COALTECH HOT HOLE BLASTING WORKSHOP MIDDELBURG MINES 4 July 2008

2. Mine Layout & Key Infrastructure 30000E 40000E 50000E LEGEND • Draglines Middelburg Nelspruit Uitkyk Mined out Reserves Reserves • 5011 • 5012 • 5013 • 5014 • 5015 • 5016 2860000S 2860000S Witbank Goedehoop Overland Conveyor North Plant x 2870000S 2870000S Klipfontein Hartbeestfontein North/South Rail Link x Driefontein South Plant x • Extent of Mining Lease Area • N - S : 30 km • E - W : 25 km • Total Area : 21 117 Ha • Mined out : 4 690 Ha Wolvekrans Vlaklaagte Problem Area Boschmanskrans DMO

3. MINING METHODS OVERBURDEN STRIPPING MIDBURDEN STRIPPING

4. Coal and pyrite oxidized by air, OXYGEN & producing heat WATER OXYGEN & WATER OXYGEN & SINKHOLE WATER Heat causes Cracks and holes coal to catch allow more air SINKHOLE fire SURFACE into the mine DEPRESSION OXYGEN FEED FIRE WATER Coal pillars burn WATER Roof collapses, away and weaken creating cracks roof of workings and holes to surface CYCLE OF UNDERGROUND COAL FIRES

5. 0 0.00 to 2.00 SOIL SFT LOW 2.00 to 2.68 SANDSTONE, MUDDY 2.68 to 4.00 MUDSTONE, PEBBLY 4.00 to 6.18 COAL S4L 5 6.18 to 7.28 SANDSTONE, MUDDY, very fine grained S3 7.28 to 7.73 SANDSTONE, GRITTY, very coarse grained 7.73 to 7.89 MUDSTONE, SANDY, clayey 7.89 to 8.16 COAL 10 8.16 to 9.10 FINES, silty 15 16.96 to 18.00 MUDSTONE, SANDY, clayey 18.00 to 20.62 SANDSTONE, MUDDY, very fine grained 20 20.62 to 24.22 MUDSTONE, SANDY, clayey 24.22 to 29.90 COAL S2R 25 S2 S2P 30 S2A 29.90 to 30.00 MUDSTONE, SANDY, clayey 30.00 to 31.23 COAL S1 31.23 to 31.30 GRIT, granules 31.30 to 33.45 COAL 33.45 to 33.72 MUDSTONE, sandy 33.72 to 33.77 COAL 35 33.77 to 33.82 SANDSTONE, MUDDY, fine grained DWK 33.82 to 34.00 COAL, SHALY 34.00 to 34.28 SANDSTONE, MUDDY 34.28 to 34.35 COAL, SHALY 34.35 to 37.35 DIAMICTITE, pebbles 40 STRATIGRAPHIC BOREHOLE SECTION 9.10 to 16.98 SANDSTONE, very fine grained Burning Area

6. HOT HOLE & VENTING

7. INCIDENT 2003 • Uncontrolled Detonation 10 April ‘03 • Fully charged hole on Midburden • No injuries • Investigation and revision of current risk assessment • New Procedure was written • Information gathering requested on hot hole procedures • Frank Chiappetta was contacted in June ’03 • Guidelines received from Frank Chiappetta in October 03

8. 100° 20° THERMAL IMAGING OF BOSCHMANSKRANS SECTION • Thermal Imaging (Thermography) • Characteristics of heat to measure thermal gradients on surface • Infrared photography at night • These gradients shows hot or cold anomaly on surface • Surface temperature may not verify the extent of the problem • Airflow through cracks etc. may cool or heat up the surface • Thermal anomalies may verify the degree or risk of spontaneous combustion • A small temperature gradient can be an inferno 1m below surface • All anomalies are positive until verified Feb-Mar ‘04

9. BOREHOLE MONITORING

10. BOREHOLE MONITORING –BH1 GRAHAMS RATIO Active Fire Serious Heating Extensive Heating Heating Normal

11. BOREHOLE MONITORING TEMPERATURES °C

12. BOREHOLE MONITORING • Boreholes shows signs of elevated temperatures in the underground workings, between 20°C to 245 °C • This is supported by the Grahams Ratio, indicating active burning in the underground workings. • From the gas monitoring results there is no immediate risk of an uncontrolled underground gas explosion • Bearing the abovementioned in mind, the Boschmanskrans midburden should be addressed at all times as a hot hole area. • All blast holes drilled on the midburden should be stopped well clear of the No. 2 coal seam roof. • 30m Midburden buffer to be maintained at all times. • Cladding the buffer as soon as possible after exposure

13. Blasting activities start at BMK Section Midburden blocks 1340,1341 and 1342 BME starts pumping holes with HEF 206 BME resumes charging the holes on blocks 1341 and 1342 BME resumes charging the holes on blocks 1341 and 1342 At approximately 11:45 the BME Foreman heard a popping sound SMX starts pumping holes with Heavy ANFO for a trail blast on block 1340 Holes are primed with detonators and 400g boosters Monday 24 May o4 Tuesday 25 May o4 Upon investigation it was found that the primer in hole “K3” had detonated Drill busy doing re-drills Approximately 20 minutes after charging hole “I6” signs of the explosives heating is noticed. All the remaining primers are removed from the holes not charged and left on top of the ground next to the holes till the next day Hole explodes approximately 15 minutes after the heating was observed INCIDENTS 2004 Time line for Unplanned Detonation Incident

14. BHP BILLITON ZERO HARM POLICY • RECENT UNPLANNED DETONATIONS LED TO THE SUSPENSION OF ALL • DRILL AND BLAST ACTIVITIES • No amount of money is worth a life • Think and plan before you and your team act • Every person has the right to STOP work if they believe, in good faith, the job is unsafe • We are committed to ZERO HARM and will shut down operations until they are made safe • Any manager, supervisor or contractor who puts profit or production before people is not aligned with the leadership of BHP Billiton

15. WORKSHOP ON DRILLING & BLASTING HOT AREAS AT MMS • Planning the blast area (Main Focus Areas) • Plan for the blasting of the hot area only and refrain from unplanned activities that could lead to extended time on the block. • Drilling Procedure • Drill holes are drilled 2 metres short from coal elevation to limit roof collapsing and to increase the distance from the origin of the heat – 2 seam coal burning. • A re-drill hole will be drilled in the same line 2 metres away and 1 metre shorter. 29/06/04

16. WORKSHOP ON DRILLING & BLASTING HOT AREAS AT MMS • Temperature monitoring and profiling • Under no circumstances, will anyone load holes in a hot area without monitoring the borehole temperatures, this is extremely critical and cannot be overstated. • Temperatures are not a true reflection of wall temperature but rather in hole air temperature. • Water or cooling agents might lead to cracks in the strata due to the change in rock temperature • Explosives • Tests to be done on explosives to determine at what stage in depth the hydrostatic head might lead to detonation • Explosives does not seem to be the danger under extreme temperatures as it would boil away, PROVIDED it is not contained. • Blended or emulsions are recommended in hot hole charging. • Explosives will be augered in dry holes to save time and pumped when the holes are wet - rate difference. • Temperature transfer through emulsions is slow.

17. WORKSHOP ON DRILLING & BLASTING HOT AREAS AT MMS • Initiation systems & Stemming • This is the most critical element in the entire process as the accessories have the least resistance against heat • Surface delay’s (NTD’S) with detonating cord down the hole seems to be the safer option as only one blast hole can detonate if a problem does arise. • Concerns were raised regarding stemming in the blast hole as it will lead to confinement of the explosive which will increase the risk of the explosive to detonate due to an increase in pressure. • Temperature tolerance and recommended exposure times • The rate at which the temperature change within the blast hole is the risk involved with hot hole charging. • All blast holes will tagged with the hole number, hole depth and hole temperatures – (holes below 45C will be tagged with a white tag and holes above 45C will have a red tag). • Temperature of holes up to 45C will be charged without cooling agent. • Temperature of holes above 45C will be treated with cooling agent first and be charged last. • Holes above 65C after treatment will not be charged and closed immediately . • Holes above 80C will not be considered for blasting and closed.

18. THE CURRENT PROCEDURE

19. THE CURRENT PROCEDURE

20. THE CURRENT PROCEDURE

21. THE CURRENT PROCEDURE Marking and Monitoring Holes Drilling the Area

22. THE CURRENT PROCEDURE Cooling the Holes

23. THE CURRENT PROCEDURE Holes Cooled down with pyrocool Re-Monitoring Holes After Cooling

24. THE CURRENT PROCEDURE Charging the Holes

25. THE CURRENT PROCEDURE Re-Monitoring Holes After Charging Preparing the Tie-up

26. THE CURRENT PROCEDURE Clearing the Pit Priming the Hot Holes

27. THE CURRENT PROCEDURE Blasting the Hot Holes

28. INCIDENT AND ACTIONS FOR OVERBURDEN • Premature Detonation on Overburden – 23 February 2007 • Detonation occurred at start of dayshift no employees in the area • Actions after incident • Overburden at BMK also declared Hot • All overburden holes will be continuously monitored • No blast may be slept over (Blast on the same day) • Blast dimensions limited to bulk explosive truck capacity • Bottom Priming still done on O/B blasts, except hot holes • Stemming done during surface tie up • Blast closing procedure similar to midburden blasting

29. KEY LEARNINGS • Key Success Points • NO Incidents on midburden since the incorporation of the Standard Operating Procedure on Blasting Operations in Hot Area’s • Enable mining operations to continue after being stopped • Possible impact on the future of the coal industry • Procedure in place to do blasting of hot holes safely • Key Difficulties in Implementation • Understanding the risks associated with hot hole blasting • Continuous training on the block • Key Learnings - What we would do again? • Continuous Temperature Monitoring • Plan to limit the time spend on the block to a minimum • Area cleared before any initiation system comes in contact with explosives and no detonator down the hole • No stemming in the blastholes (Midburden)

30. ACKNOWLEDGEMENTS • Blasting Analysis International, Inc. (Frank Chiappetta) • Dyno Nobel (North America) • African Explosives Limited • Bulk Mining Explosives • SASOL Nitro (Explosives Division) • Kleinkopje Colliery • Tom Fürstenburg (Thermal Imaging) • CSIR • Mt Arthur Coal (Australia) • Middelburg Mine Management • Apogee Coal Company (Logan, West Virginia) • Queensland Government (Australia) • BHP Billiton Community of Practice Network • US Federal Government

31. Questions?