Common use of Feasibility Studies Clause in Contracts

Feasibility Studies. The Feasibility Study must: (a) be conducted based on customary economic assumptions agreed by the Owners’ Council (other than in respect of the assumptions listed in paragraphs (a)(i), (ii) and (iii)) or, in the absence of such agreement (or in the case of paragraphs (a)(i), (ii) and (iii)), selected by the Manager, including in relation to: (i) iron ore prices; (ii) current and projected demand and supply conditions in the global market; (iii) foreign exchange; (iv) cost of capital; and (v) inflation; (b) include the final scope and project delivery plan of the Project, including: (i) detailed technical information, plans, specifications, maps and any other information which may reasonably be considered relevant to the Project, including: (A) the quantum and nature of scheduled iron ore reserves and resources within the defined area of the Project; (B) the product type and likely trends in quality specifications that are expected to be produced; (C) projected capital and operating costs of the Project over the project life; (D) the quantity of additional system capacity (including Latent System Capacity across each major infrastructure element to be used by the expansion or development) that is expected to be created by the Project; (E) a clear statement of the scheduled iron ore reserves and resources to be consumed by the Project and a delivery schedule setting out the tonnages expected to be produced and delivered for each year of the Project; (F) the required use of system capacity broken down by major infrastructure element to be used in connection with the Project; and (G) details of any downstream infrastructure that is required to be constructed in connection with the Project; (ii) a definitive engineering study capital cost estimate (±10–15%) of the cost to bring the Project to Operational Completion and reasonable details of the major categories of expenditure, including: (A) direct; (B) indirect; (C) Owner’s; and (D) contingent costs; (iii) an assessment of the Project (including valuation) based on the Iron Ore Product being produced by that Project being sold as both a stand alone product and a blended product; (iv) preparation of social and environmental impact assessment; (v) details of the associated execution strategy required to implement the Project, including Authorisations, third party approvals, commercial, contract and evaluation of key risks and identification of risk management strategies; and (vi) an operational implementation plan, including the identification of the project schedule and key project milestones (the Operational Implementation Plan); and (c) otherwise be of a standard which is sufficient to allow the Manager to proceed immediately to construction and include such information, contain such analysis, and be in a form that would enable a major international bank to form a reasonable judgment with respect to the provision of project financing for the Project. In addition to providing each Owner with a copy of each Pre-Feasibility Study and Feasibility Study, the Manager must also provide each Owner with a copy of the underlying financial models used in preparing that Pre-Feasibility Study or Feasibility Study (as applicable), including physical and financial information schedules that include operating and capital assumptions that are consistent with those set out in the Reporting Policy. The key assumptions adopted by the Manager in the preparation of the Pre-Feasibility Study or Feasibility Study (as applicable) must be clearly identified and included in those schedules. 1. Definitions and Interpretation 1 2. Provision in Accordance with clause 4.2(j) of the Joint Venture Agreement 2 3. Indemnity 2 4. Repayments and Receipts 2 5. Release of Indemnity 3 6. Confidentiality 3

Feasibility Studies. The Feasibility Study must: (a) be conducted based on customary economic assumptions agreed by the Owners’ Council (other than in respect of the assumptions listed in paragraphs (a)(i), (ii) and (iii)) or, in the absence of such agreement (or in the case of paragraphs (a)(i), (ii) and (iii)), selected by the Manager, including in relation to: (i) iron ore prices; (ii) current and projected demand and supply conditions in the global market; (iii) foreign exchange; (iv) cost of capital; and (v) inflation; (b) include the final scope and project delivery plan of the Project, including: (i) detailed technical information, plans, specifications, maps and any other information which may reasonably be considered relevant to the Project, including: (A) the quantum and nature of scheduled iron ore reserves and resources within the defined area of the Project; (B) the product type and likely trends in quality specifications that are expected to be produced; (C) projected capital and operating costs of the Project over the project life;; West Australian Iron Ore Production Joint Venture Agreement (D) the quantity of additional system capacity (including Latent System Capacity across each major infrastructure element to be used by the expansion or development) that is expected to be created by the Project; (E) a clear statement of the scheduled iron ore reserves and resources to be consumed by the Project and a delivery schedule setting out the tonnages expected to be produced and delivered for each year of the Project; (F) the required use of system capacity broken down by major infrastructure element to be used in connection with the Project; and (G) details of any downstream infrastructure that is required to be constructed in connection with the Project; (ii) a definitive engineering study capital cost estimate (±10–15±10-15%) of the cost to bring the Project to Operational Completion and reasonable details of the major categories of expenditure, including: (A) direct; (B) indirect; (C) Owner’s; and (D) contingent costs; (iii) an assessment of the Project (including valuation) based on the Iron Ore Product being produced by that Project being sold as both a stand alone product and a blended product; (iv) preparation of social and environmental impact assessment; (v) details of the associated execution strategy required to implement the Project, including Authorisations, third party approvals, commercial, contract and evaluation of key risks and identification of risk management strategies; and (vi) an operational implementation plan, including the identification of the project schedule and key project milestones (the Operational Implementation Plan); and (c) otherwise be of a standard which is sufficient to allow the Manager to proceed immediately to construction and include such information, contain such analysis, and be in a form that would enable a major international bank to form a reasonable judgment with respect to the provision of project financing for the Project. In addition to providing each Owner with a copy of each Pre-Feasibility Study and Feasibility Study, the Manager must also provide each Owner with a copy of the underlying financial models used in preparing that Pre-Feasibility Study or Feasibility Study (as applicable), including physical and financial information schedules that include operating and capital assumptions that are consistent with those set out in the Reporting Policy. The key assumptions adopted by the Manager in the preparation of the Pre-Feasibility Study or Feasibility Study (as applicable) must be clearly identified and included in those schedules.. West Australian Iron Ore Production Joint Venture Agreement Owner Guarantee – Deed of Indemnity 1. Definitions and Interpretation 1 1.1 Joint Venture Agreement definitions to apply 1 1.2 Defined Terms 1 1.3 Joint Venture Agreement interpretation provisions to apply 2 2. Provision in Accordance with clause 4.2(j) of the Joint Venture Agreement 2 2 3. Indemnity 2 4. Repayments and Receipts 2 5. Release of Indemnity 3 6. Confidentiality 32