OREANDA-NEWS. Vale announces that its Board of Directors approved the investment budget for 2015, with capital expenditures of USD 6.358 billion for project execution and USD 3.809 billion dedicated to sustaining existing operations.

This is the fourth consecutive year in which Vale reduces its capital expenditures, maintaining capital discipline and focusing only on world class projects.

Project execution

Our main growth initiatives in iron ore are responsible for 71% of the USD 6.358 billion budgeted for project execution in 2015. These initiatives include the:

(a) Expansion of our integrated iron ore operations in Carajas (USD 3.696 billion) through the S11D and CLN S11D projects.

(b) Completion of the Itabirites projects for the partial replacement of capacity, increase in production and quality improvement in the iron ore production from the Southern and Southeastern Systems (USD 659 million), including the Conceiзгo Itabiritos II, Vargem Grande Itabiritos and Cauк Itabiritos projects.

Sustaining capital

The sustaining capital budget for 2015 totals USD 3.809 billion. Fundamentally, it will provide funding for five classes of initiatives: (i) operations, mainly equipment replacement; (ii) building and expanding waste dumps and tailings dams; (iii) health & safety; (iv) corporate social responsibility (CSR) and (v) administrative and others.

Keeping sustaining expenditures under control is a key priority and the budget for 2015 represents a decrease of 16.2% in relation to last year's budget.

The budget for the ferrous minerals business is USD 1.929 billion and will be mainly directed to operations (USD 1.203 billion), health & safety (USD 344 million), waste dumps and tailings dams (USD 246 million), CSR (USD 108 million) and others (USD 28 million). Base metals sustaining investments will total USD 1.388 billion, composed primarily of operations (USD 1.039 billion), waste dumps and tailings dams (USD 70 million), health & safety (USD 56 million), CSR (USD 193 million), which includes USD 61 million for the clean AER project and others (USD 31 million).

Expenditures in sustaining the fertilizers business will be USD 290 million, mainly comprised of investments in operations (USD 198 million), CSR (USD 48 million), waste dumps and tailings dams (USD 16 million), health & safety (USD 12 million) and others (USD 16 million). The coal business budget of USD 78 million is mostly composed of USD 52 million for operations.