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Building a Stronger Organization

Murilo Ferreira, Vale CEO

Bank of America / Merrill Lynch – Global Metals, Mining & Steels CEO Conference

Barcelona, May 12, 2015

1

Dis

clai

mer

“This presentation may include statements that present Vale's

expectations about future events or results. All statements,

when based upon expectations about the future and not on

historical facts, involve various risks and uncertainties. Vale

cannot guarantee that such statements will prove correct.

These risks and uncertainties include factors related to the

following: (a) the countries where we operate, especially

Brazil and Canada; (b) the global economy; (c) the capital

markets; (d) the mining and metals prices and their

dependence on global industrial production, which is cyclical

by nature; and (e) global competition in the markets in which

Vale operates. To obtain further information on factors that

may lead to results different from those forecast by Vale,

please consult the reports Vale files with the U.S. Securities

and Exchange Commission (SEC), the Brazilian Comissão de

Valores Mobiliários (CVM), the French Autorité des Marchés

Financiers (AMF) and The Stock Exchange of Hong Kong

Limited, and in particular the factors discussed under

“Forward-Looking Statements” and “Risk Factors” in Vale’s

annual report on Form 20-F.”

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We have been working in several dimensions to further improve

Vale´s highly competitive position in the mining industry

Delivering

projects

Increasing

Volumes Reducing

Costs and

expenses

Increasing

productivity

Strengthening

our license

to operate

Setting the basis

for strong Free

Cash Flows

3

7.117

4,521³

3.547

2012 2013 2014

-50%

We have reduced expenses1,2 significantly but we are not

there yet…

¹ Net of depreciation and amortization.

² Includes SG&A, R&D, Pre-operating and stoppage and Other expenses.

³ Excludes the positive one off impact of US$ 244 million of the goldstream transaction in 1Q13 4 Excludes the positive one off impact of US$ 230 million of the goldstream transaction in 1Q15.

-21%

808

638

1Q14 1Q15

4

US$ million

4

We have also made significant progress on cost reductions

but we are still not satisfied

Cash Cost FOB¹ port Brazil

Freight Costs

19,9 18,3

22.7

19.8

1Q14 1Q15

23,9

17,2

1Q14 1Q15²

Iron ore unit costs and expenses, US$/t

-13%

¹ Ex-ROM and third party acquisitions.

² Excludes US$ 2,3/t of the bunker oil hedge.

Royalties

-28%

Expenses

7,5

4,0

1Q14 1Q15

-47%

5

We remain committed to delivering additional

productivity gains

• Improvement in availability of the transportation fleet

in the Northern System

• Resizing of infrastructure, drilling and transportation

fleets

• Optimization of mine plans

• Ramp up of the Itabirites projects

• Improvement in the yield of the concentration plants

• Extension of the natural screening process to older

plants in Carajás

• Full automatic operation of reclaimers

• Automated operation of trains

• Implementation of innovative technology:

− Distributed traction technology

− Energy control systems at the ports

− Reverse routes at the ports

Mine

Beneficiation

Logistics

corridors

Example of initiatives Status

Completed

In implementation

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High quality products will replace lower grade material and improve margins

And we are about to operate some of the most competitive

assets in the world

Itabirites Projects N4WS in Carajás

N4WS Waste

Dump

Plant 2

Plant 2

Primary

Crusher

N5W

N5S

N4E

N4W

• N4WS licensed in 2014

• Pre-stripping completed

• Already mining the first layer of product (“canga”)

• Vargem Grande Itabiritos started up in 4Q14

• Conceição Itabiritos II and Cauê Itabiritos will

start up in 2015

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Our differentiated and further improved product quality will

drive price realization up

Alumina Content

%

1,4

1,3

2014 2018

Fe Content

%

Silica Content

%

-0.1 pp

63,7

64,6

2014 2018

+0.9 pp

-1.3 pp

4,6

3,3

2014 2018

9,5%

8,3%

10,1%

11,6%

12,6%

1Q14 2Q14 3Q14 4Q14 1Q15

Delta premium IOCJ 65% vs. Platts 62%

%, premium over Platts

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And our iron ore break-even will reduce even further as early as

2015

43 2-3 0-1

0-1 0-1 37- 41

1Q15 FOB Cash Costs Expenses Quality Freight Average 2015

US$ / dmt, average costs and expenses landed in China¹

1 Adjusted for quality (Fe content differential and other elements such as silica, alumina and phosphorus)

² Excludes the impact of the bunker hedge accounting (US$ 2.3 /t at 1Q15)

³ Assumes 3.05 BRL/USD 4 Assumes VIU ranging from US$ 1.0/t to US$ 1.1/t 5 Assumes spot freight rates Brazil-China ranging from US$ 10.5 /t to US$14.0/t

2 2 4 5 3 3

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• 8 projects delivered in 2014

• S11D advancing as planned: mine and logistics

physical progress of 64% and 36%, respectively

• Conceição Itabirites II: 97% of physical progress

• Cauê Itabirites: 82% of physical progress

• Mozambique: mine and logistics physical progress

of 86% and 85%, respectively

• Investment cycle completed in Base Metals

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12

9

7

5 4

2013 2014 2015 2016 2017 2018

Vale capex¹ profile @ 3 BRL/USD

US$ billion

In the coming years our capex will reduce sharply as we

complete our investment cycle

Forecast

Status of Vale’s project portfolio

¹ Growth plus sustaining capex

10

4 4 5

8

17

22

26 26

2012 2013 2014 2015 2016 2017 2018 2019

And upon completion of projects our production volumes

will grow across all business segments

Copper

Kt

Coal

Mt

Nickel

Kt

Iron Ore¹

Mt

319 310 332 340

376

411

453 459

2012 2013 2014 2015 2016 2017 2018 2019

237

260

275

303 316

2012 2013 2014 2015 2016

292

370 380

449 450

2012 2013 2014 2015 2016

¹ Own production only, excluding Samarco’s attributable production

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Helping us reach our ebitda targets¹ in base metals for 2015

and 2016

3.1-4.6 0-1.0

0.1-0.3

0.5-0.8

2.5

2015-2016Canada & PTVIOperations

VNCSalobo2014

US$ billion

Reach 37 Ktpa at

VNC

1 Considering 3,00 BRL/USD, 1,28 CAD/USD, copper prices ranging from US$ 5,800 to 6,800 /t and nickel prices ranging from

US$ 14,500 to 21,000 /t

Complete the ramp up

of Salobo (200 Ktpa)

Increase volumes and

reduce cost and expenses

in Canada and Indonesia

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3,3

2,0

1,2

0,5

7,0

Costs reduction Expenses reduction Quality²/Pricingimprovement

CFR freight reduction Total

And helping us reach even higher margins in iron ore

Increase in EBITDA unit margins (US$/t), 2018 vs. 2015

1 Excluding ore from third parties, ROM and pellets

² Based on Fe content differential between 2015 and 2018

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Aluminium

Logistics

Oil & Gas

Gold

Copper

Fertilizers

Kaolin

Coal

Shipping

Manganese

Energy

Meanwhile, we continue to divest non-core assets and form

strategic partnerships

¹ Including the impact of capex avoided by VALE

2011

US$ 1.1 billion

10 Very

Large Ore

Carriers

El Hatillo

Araucária

Ferroalloy plants in

Europe

Oil & Gas

Concessions I

CADAM

Gold

streaming I

Gold

streaming II

VLI

Log-in

Fosbrasil

Tres Valles

Oil & Gas

Concessions II

Mozambique deal

with Mitsui¹

Belo Monte

participation

Aluminium

assets

Norsk Hydro

2012

US$ 1.5 billion

2013

US$ 6.0 billion

2015

US$ 5.0 billion

Reference

US$ 1 billion

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From these divestments and partnerships we expect to raise

US$ 6-7 billion in cash proceeds in 2015

Timing Cash Impact

in 2015 Status Initiatives

• Mozambique

Coal

• Project Finance in advanced stage

of discussion

• Government authorizations and

direct agreements with lenders

under discussion

• VLOCs • Progress on the previously

announced negotiation with COSCO

and other undisclosed partners and

on the development of a financial

structure for the sale of vessels

• Non-voting

shares

• Transaction structure and contracts

being prepared

• Goldstream • Completed with US$ 900 million

received in March 2015

4Q

2Q/3Q

2Q/3Q

Done

Transaction details

• Investment agreement with

Mitsui for partnering in the

Mozambique coal project

• Sale of Valemaxes with the

signature of long-term, low

cost freight agreements

• Issuance of redeemable non-

voting shares on specific

assets

• Sale of an additional 25% of

the payable gold stream from

the Salobo mine

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Results from our initiatives are already setting the basis for strong

free cash flow generation as of 2018

• Capex will be around US$ 4 billion

• Volumes will increase by about 40% in iron ore, 20% in copper

and 15% in nickel

• Costs will decrease with higher productivity, further dilution of

fixed costs and expenses, and organizational restructuring

• Iron ore quality will support an increase in price realization

• Freight costs will decrease

• Free cash flow and dividends will reach unprecedented levels

and debt will reduce gradually

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