Presentation Transcript

1. Gregory H. Boyce Chairman and Chief Executive Officer

   Sustainable Coal and Energy Accessfor All

   February 10, 2012
2. Safety Contact: A Peabody Tradition Make Safety Part of Your Daily Routine The Don Haskins Center
3. Sustainable Coal and Energy Access for All Key Discussion Themes Global Energy Access is Job One Advanced Technologies Key to Economic and Environmental Goals Leadership is Essential for a Sustainable Future
4. World is Experiencing an Enormous Wave of Energy Demand Extraordinary Global Growth by 2050… World population reaches 9 billion Electricity generation up 130% Steel production up 275% Global GDP up 270% 16 billion tons of coal used annually Guangzhou, China
5. China Driving Hyper Energy Growth Through Rapid Urbanization China Australia U.S. 1.3 Billion 22 Million 307 Million Population Rank byPopulation No. 1 No. 51 No. 3 Cities 1+ Million 160 5 51 Cities 5+ Million 12 0 9 Source: McKinsey & Company, March 2009, Preparing for China’s Urban Billion; U.S. Census Bureau.
6. Shanghai’s ExtraordinaryTransformation in 20 Years Today Shanghai is the World’s 10th Largest City
7. Global Energy Access is Job One Rajasthan, India
8. Energy is a Human Right and a Rapidly Rising Need 3.6 Billion People Have No or Only Partial Access to Electricity 70 378 136 1,054 21 184 2 493 209 585 449 31 Millions of People Who Lack Adequate Electricity Millions of People Who Have No Electricity Source: International Energy Agency World Energy Outlook 2011 and The World Bank World Development Indicators 2011.
9. Electricity Enables People to Live Longer and Better United Nations Links Affordable Energy to Quality of Life Every 10-Fold Increase in Per Capita Electricity Use Drives a 10-Year Increase in Longevity Source: CIA World Fact Book, United Nations Development Program’s Human Development Report.
10. The Economic Miracle Powered by Coal Near Perfect Correlation Between Coal Use and GDP Growth Global Electricity from Coal $100 90 80 World GDP 70 60 Electricity from Coal (TWh) World GDP (trillions of 2005 $) 50 40 30 20 10 Source: Developed from International Energy Agency World Energy Outlook (1995-2011); USDA 2011.
11. World’s Fastest-Growing Economies Fueled by Coal Asia Represents 90% of 4.4 Billion Tonne Coal Demand Growth +100 +315 +2,220 +710 +1,080 +50 Coal Demand Growth 2009 - 2035 (Tonnes in Millions) U.S. growth presented in short tons. Source: World Energy Outlook 2011, International Energy Agency; Annual Energy Outlook 2011, Energy Information Administration; Peabody analysis.
12. Global Coal Use Overtakes Oil as Largest Energy Source by 2035 Coal Demand Growth (2009 – 2035) Energy growth from coal: 30% greater than natural gas growth Double the oil growth Twice the current global use of nuclear, hydro and other renewables combined 65% Energy Demand (Mtoe) Source: International Energy Agency, World Energy Outlook 2011.
13. Coal Generation Growth: MoreThan Twice Nearest Alternative Exceeds Growth in Gas, Oil, Nuclear, Hydro, Biomass, Geo & Solar Incremental Generation by Fuel Type (2009 – 2020) 3,922 Coal Other Fuels Combined 3,701 Natural Gas 1,668 Hydro 1,002 Nuclear 798 Biomass 291 Solar 175 Geothermal 53 Oil (277) Electricity Generation (TWh) Source: International Energy Agency, World Energy Outlook 2011.
14. Major Build Out of Global Coal Generation Under Way 2011 – 2020 New Coal-Fueled Generating Capacity (GW) Coal-fueled generation expected to grow 700 GW by 2020 Additional 2+billion tonnes of coal demand anticipated Creates $2.4 trillion in economic output and 15.3 million jobs Rest of World India China Source: Platts Worldwide Power Plant Database; EIA International Energy Outlook 2010 and Peabody analysis. Growth of global coal-based generation (billion kilowatt hours) based on 2007 – 2035 EIA data.
15. Steel Production Drives Metallurgical Coal Increases Global Steel Production Steel production expected to increase 40% by 2020 Additional 400 million tonnes of added metallurgical demand China, India and Brazil to drive demand through increased urbanization and economic growth Steel Production (million tonnes) Global steel production source: Raw Materials Group, 2011 Global Commodity Forum for UN Committee on Trade and Development.
16. Technologies Key to Economic, Environmental Goals GreenGen Power Plant and Carbon Research Center; Tianjin, China
17. Advanced Technologies Drive Major Environmental Progress Emissions Decline 87% Since 1970 as Coal Use Nearly Triples Coal-BasedPower Generation + 170% + 103% GDP per Capita Lbs. Criteria Emissions/MWh from Coal - 87% Source: USDA 2011; Energy Information Administration 2012; U.S. EPA Air Trends Data, 2012; Peabody analysis 2012. GDP in 2005 $.
18. Supercritical Technology Being Deployed Globally China Houses 40% of the World’s Advanced Coal Fleet 429 GW On Line andUnder Construction Technology Achieves One-Fifth the Average Emission Rate of Existing U.S. Coal Fleet and Lower CO2 Emission Rate U.S. 96 GW China 175 GW India 37 GW Japan 20 GW Germany 12 GW ROW 45 GW S. Korea 17 GW Russia 16 GW Other EU 11 GW Supercritical and ultrasupercritical operating plants and plants under construction. Source: Platts World Electric Power Plant Database, January 2011.
19. Peabody Plan: Leadership to Advance 3Es Five Key Steps to Alleviate Energy Inequality Ensure at least half of new generation from coal Replace older coal plants with supercritical plants Develop 100 CCS projects in a decade Deploy coal-to-gas, coal-to-chemicals, coal-to-liquids Commercialize near-zero emissions technology GreenGen Power Plant, Tianjin
20. Global Supercritical Program Would Create Major Reindustrialization Replacing traditional coal plants with supercritical plants would drive global reindustrialization Annual benefit of operating these plants includes: $470 billion in economic output $170 billion boost to personal income $89 billion of tax revenues 1.4 million plant and supply chain jobs Source: International Energy Agency, Management Information Services and Peabody analysis.
21. Peabody only non-Chinese partner in GreenGen Multi-phase power project with carbon capture and carbon research center First 250 MW unit commissioning under way Expected on line first quarter 2012 China Leads Global TechnologyPath With GreenGen GreenGen: Among World’s Largest Near-Zero Emissions Coal Plants Control Room at the GreenGen Plant Tianjin, China
22. South Africa is a Case Study for the Peabody Plan South Africa’s GDP 10 Times Higher Than Other African Nations 90+% of South Africa’s electricity coal-fueled South Africa uses 40 times more electricity than Sub-Saharan counterparts Largest economy on the continent Bringing rest of Africa to parity with South Africa would require 4 billion tons of coal annually by 2050 South Africa Electrification Rate South Africa GDP/Capita Other Sub-SaharanElectrification Rate Other Sub-Saharan GDP/Capita Source: USDA 2010, The World Bank 2011, Asian Infrastructure 2008.
23. Leadership for a Sustainable Future
24. Peabody Energy: World’s LargestPrivate-Sector Coal Company Source: Company reports and websites, SEC filings and Peabody analysis. Values are on a short-ton basis.
25. Peabody Transforms ItsGlobal Platform 2011 MCC Acquisition 2011 Trading Offices Queensland Low-Vol PCI Germany & India; Indonesian Business Office 2010 Asia 100 Vision 100 MM Tons in 10 Yrs 2009 Asian Trading Hub Singapore Trading & Jakarta Office 2007 Mongolia Entry UlaanbaatarOffice 2007 Patriot Spin Off Appalachian Assets 2006 UK Expansion 2006 Excel Acquisition London Trading Office Opens Queensland, NSW Assets 2005 Entry into Asia 2004 RAG Acquisition Beijing Business & Trading Office Queensland, Venezuela ColoradoAssets
26. Strengthened Global Platform Leads to Record Financial Results Increasing Revenues, Operating Profit and EBITDA +80% +120% +170% Revenues Operating Profit EBITDA $592 $958 $822 Financials include Macarthur contribution and exclude discontinued operations.
27. Peabody’s International OperationsContribute Half of Earnings EBITDA from Mining Operations 2003 2007 2011 Australia 17% Australia 50% U.S. 50% U.S. 83% U.S. >99% Percentages represent share of Mining EBITDA.
28. Leadership for a Sustainable World Company Strategy and Implementation Economic Activity and Market Identification Energy Strategy and Industry Leadership Environmental, Economic and Energy Goals How to Do It as Important as What to Do
29. Leadership Starts With Each One of Us: Four Key Pillars Inspiration Motivate, Mentor, Excite Employees Establish a Clear Goal Respect Input from All Involved Develop Best Practice Approach Give Credit Where Credit is Due
30. Four Key Pillars… Innovation Foster New Ideas, Take Calculated Risks Embrace New Ways of Thinking Involve Subject Matter Experts Use Resources to Fullest Potential Collaborate for Best Result
31. Four Key Pillars… Collaboration Build Strong Teams, Act for Good of Company Secure Success by Engaging the RightPeople Inspire By ShowingRespect Recognize the Value of Teams for Ownership and Accountability
32. Four Key Pillars… Execution Achieve Results, Promote Health of Enterprise Use Leadership Pillars to Drive Action Benchmark Results Seek ContinuousImprovement
33. Personal Vision and Accountabilityfor Sustainable Leadership UT El Paso Leadership Engineering Program UT El Paso alumna Bob Malone and his wife Diane established the Engineering Leadership Bachelor’s program in 2011 $1 million personal gift matched by $1 million Halliburton grant First of its kind leadership program for 21st Century engineers Focused on integration of engineering, business, ethics, and social sciences Bob and Diane Malone “Diane and I did this because we love this university and because it was so good to us.” – Bob Malone
34. Sustainable Leadership For the 21st Century Social ContractCreate Energy Access and Alleviate Energy Poverty Peabody PlanPeabody is Leading Energy Solutions in a World that Needs More Energy Personal Leadership Essential to Advance the ‘What and How’
35. Gregory H. Boyce Chairman and Chief Executive Officer

    Sustainable Coal and Energy Accessfor All

    February 10, 2012