Grange Resources : Annual Report to shareholders

GRANGE RESOURCES | ANNUAL REPORT 2021

MILLION TONNES

pellet production.

MILLION TONNES

total iron ore product sales.

DAYS LOST INJURY TIME

FREEMILLION PROFIT

after tax.

2022 PRIORITIES

Grange is Australia's proven, safe, reliable, long-life producer of magnetite iron ore and premium quality pellets. Grange is committed to the local community of Northwest Tasmania and makes a significant contribution to the state economy.

The Board has defined some key areas of focus to underpin the improvement of Grange's business. The following areas focus on: Developing a sustainable Life-of-Mine-Plan; Integrating innovation into all aspects of the business; Sustaining ageing infrastructure; Building capacity and capability within our workforce; Achieving environmental, social and governance credentials to ensure our sustainability. Grange's business and operational planning is directed to deliver into these core strategies.

of new technology will support and improve operational outcomes. Our focus will be to: determine the potential to introduce automation into the operation; upgrade the equipment tracking system for the mine and optimise the mining cycle to reduce delay and increase efficiency; review the opportunity for sources and supply of green energy; and build production capability for potential expansion of the operation.

SUSTAIN AGEING INFRASTRUCTURE

DEVELOPING A SUSTAINABLE LIFE-OF-MINE-PLAN

The Life-of-Mine-Plan is a key to underpin investment decisions and to optimise business execution. Geotechnical instability in the mine pit walls has historically introduced uncertainty into the production profile. Over the past 3 years we have reduced the risk to the production profile with the re-commencement of Centre Pit providing a second ore source, the building of a substantial ore stockpile and investment in our geotechnical model and controls. We will continue to seek to mitigate increasing pressure on OPEX costs; develop contingency for extreme weather events; understand and mitigate risk of environmental approval delays on project development and complete the studies to enable integration and optionality for Open Pit and Underground operation.

Our operation is supported by mature and valuable infrastructure and assets. Careful conditional monitoring and maintenance enabled us extend the life on many of these assets. This has enabled the company to defer capital expenditure on major overhauls and infrastructure replacement during periods of downturn in the past and assets do require investment to restore or replace where appropriate. Cost Benefit Analysis will be used to support overhaul versus replacement decisions. Our focus will be to: manage and maintain mobile plant in the mine; manage and maintain fixed plant; continue offshore structural refurbishment; sustain the light vehicle fleet to support safe and productive operation; and determine the ongoing maintenance requirements to sustain the Pipeline for the long term.

BUILD CAPACITY & CAPABILITY

North Pit is the main source of ore for 2022 and Grange will continue to invest in stripping Centre Pit to deliver future high-grade ore. For longer term asset development, the focus will be on the completion of the Underground Study with the integrated Enterprise Optimisation. This will provide a basis for an optimised Life of Mine Plan with a view to maximise the efficient and effective recovery of the mineral resource at Savage River.

We recognise that our people are our most valuable asset. We have a committed workforce with strong skills and experience base. There is increasing competition for human resources as the resource industry cycles and acknowledge there is a risk of losing key technical staff and some of our skills and experience.

To mitigate these risks we will implement retention strategies to retain employees; develop strategies to attract the required skills into the business; improve the communication of our brand and operation in order to attract talent and build specialised expertise as we gain certainty with respect to our optimised and de-risked Life-of-Mine-Plan.

INTEGRATE INNOVATION

Innovation is critical to improving safety, efficiency and reducing ESG & SUSTAINABILITYcost. Innovation tools are integrated into the business through our Management Operating System (MOS), and we are building capability with our people and systems. This will be considered at the transactional level, and in the development of the plan. ApplicationGrange is committed to supporting the prosperity of the communities in which we operate. We align our business, where applicable, to the sustainable development goals that provide a roadmap to sustainability and resilience.

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