NEWCREST SUSTAINABILITY REPORT 2010 · NEWCREST SUSTAINABILITY REPORT 2010 Supporting documents as...

NEWCREST SUSTAINABILITY REPORT 2010

NEWCREST SUSTAINABILITY REPORT 2010

Supporting documents as indicated by the green coloured text can be accessed through the online version of this report.

2 Strategy and Analysis4 Organisational Profile7 Report Parameters11 Governance, Commitments and Engagement21 Economic Performance Indicators26 Environmental Performance Indicators48 Social Performance Indicators71 GRI Indicator Table

STRATEgY ANd ANALYSIS

CEO StatEmEntNewcrest pursues a strategy of delivering competitive shareholder returns by:

building a portfolio of low‑cost, long‑life gold assets, primarily • through exploration and focus on early entry merger and acquiring prospects in known gold regions;optimising performance at each phase of the gold mining • value chain; andharnessing its technical expertise across a wide range • of mining formats.

This Sustainability Report is Newcrest’s seventh. It is based on the Global Reporting Initiative (GRI) G3 Guidelines and elements of the Mining and Metals Sector Supplement have been included.As in past years, the Sustainability Report has been made available online to enable readers to access links to a range of supporting documents. These documents provide greater detail in key areas of Newcrest’s environmental performance. Newcrest will continue to build its Sustainability Report in coming years to cater for the diverse requirements of key stakeholder groups.

1.1 message from the managing Director and CEONewcrest is focussed on maintaining a safe environment for its employees, operating and developing mines in line with good environmental practices and embracing a strong sense of commitment to the local communities around its operations. This sustainability report provides further insight into our sustainability performance and the programs we have in place to deliver on our vision of being the ‘Miner of Choice’.The strong focus on safety continued with a program to refresh key aspects of the ‘Target Zero, No Accidents Today’ initiative. The Company recorded a significant reduction in Lost Time Injury Frequency Rate (LTIFR – the rate of lost time injuries per million hours of exposure) of 0.6 down from 0.8 in the previous year and a Total Recordable Injury Frequency Rate of 5.8 for the year down from 7.0 in the previous year. The Company aims to further reduce these figures over the upcoming year.The strong focus on safety continued with a number of important initiatives implemented during the year. A complete review and update of the Newcrest Safety and Health Management Systems was completed and control frameworks for Major Safety and Health Hazards across business were developed based on Newcrest’s Major Hazard Management Program. The ‘Leading with Safety’ program was rolled out across Cadia, Telfer and Gosowong with an objective of further developing safety leadership competencies amongst line managers and to engage all members of the workforce in improving safety. This initiative will continue in the year ahead.Newcrest also continued to support a wide variety of community initiatives through its community partnership programs and funding for local infrastructure projects.At Telfer, we are building on our existing benefits agreements with the Martu people, a wide range of community health and well being programs are being sponsored throughout the remote Martu communities and the established work readiness programs for Martu continued. At Cracow, scholarships have trebled for local indigenous secondary students and for the first time is supporting students going into higher education by the introduction of a cadetship program. At Cadia Valley the introduction of the Rent‑a‑Farmhouse scheme to support the local school and community infrastructure has grown in the last 12 months,

with the project exceeding all original objectives. At Hidden Valley, the ‘Sustainable Community Development Plan’ was approved and is now being rolled out.The Corporate Social Responsibility Program at Gosowong continued to support the transition to sustainable economic development with projects including corn and sago cultivation and establishment of fish farming.A critical success factor in Newcrest’s sustainability is its ability to attract, develop and retain employees who can consistently deliver outcomes that place Newcrest ahead of its competitors. As foreshadowed last year, roll out of ‘Creating Our Future’ workshops across all Newcrest was completed. This is an important initiative designed to equip all employees with the competence and confidence to build Newcrest’s future together as a team. A pilot program for the next generation of ‘Creating Our Future’ workshops – Creating our Future 2 – ‘Building Tomorrow Today’, commenced, with a roll out across all of Newcrest scheduled over the next 18 months. Also, roll out of a nationally recognised diploma level Superintendent Managerial Leadership program commenced with 120 candidates enrolled in the course in 2010.The Company further improved its environmental performance during the year with no major environmental incidents reported. The environmental incident frequency rate (the rate of environmental incidents per million hours of exposure) declined to 2.1, down from 2.2 the previous year.At Cadia Valley, Cadia East Project was approved by the NSW State Government in January 2010. In April, the Newcrest Board approved the development of the world class Cadia East development of the world‑class Cadia East deposit following completion of all regulatory requirements. This project had previously undertaken a number of social and environmental assessments and undertook extensive community consultation, with no appeals lodged against the project approval. This project will enable production from the Cadia Valley for at least the next 30 years.During the year strong progress was made on many fronts towards delivering Newcrest’s vision of being the Miner of Choice. Our future growth opportunities, both within Australia and overseas (e.g. Indonesia, Papua New Guinea and Fiji), will continue to challenge Newcrest’s approach to sustainable development. Newcrest recognises that the ability to deliver on these growth opportunities requires us to continue to improve our performance in all aspects of our business. Newcrest’s success will also be measured by how we engage with the communities and governments where we operate to create enduring and rewarding benefits for all our stakeholders.IanSmith Managing Director and Chief Executive Officer Newcrest Mining Limited

NEWCREST SUSTAINABILITY REPORT 2010 2

STRATEgY ANd ANALYSIS

1.2 Description of key impacts, risks and opportunitiesOurSustainabilityChallengesNewcrest recognises that as a leader in the exploration, development and operation of gold and gold‑copper mines, the Company has some impact and influence on many of the broader global sustainability issues facing the world today. There are also specific sustainability issues relevant to our industry and our operating locations. Newcrest acknowledges its responsibility in the delivery of positive outcomes on each of these issues, and processes and progress in addressing them are summarised below.Social ResponsibilityEmploying people with the appropriate talent and skill sets within the current labour market has proved challenging. Meeting this challenge has focused close attention on retention and recruitment. There was a significant increase in employment of 1,183 positions over the previous year (40 percent). The 2010 year has seen a trend of stability in regards to overall employee turnover at Newcrest of 11 percent in June 2010 and in June 2009. The stability in workplace turnover reflected the economic conditions during the year and the uncertainty generated by the global financial crisis.A number of initiatives have been implemented that are aimed at ensuring a more sustainable supply of talent and more effective retention strategies. Further details are available in the Section on Employment.The success of Newcrest relies on establishing and maintaining secure access to land and infrastructure in areas of operation. It is recognised that only through building positive relationships with local communities and host governments is an essential prerequisite for maintaining the social licence to operate.Wherever Newcrest operates we set out to build enduring relationships with our neighbours, characterised by mutual respect, active partnership, and long‑term commitment. Newcrest places a high priority on accommodating the different cultures, lifestyles, heritage and preferences of host communities, particularly in areas where industrial development is sparse.For details of Newcrest’s community development processes please refer to Sections on Indigenous Rights and on Community.SafetyThe nature of the minerals industry means that Newcrest’s workforce may be exposed to potential safety risks. It is for this reason that safe working practices are a priority throughout the business. The impact of key safety management initiatives, particularly our Target Zero program, is reflected in generally improved safety performance for the Company in the 2010 year including:

No fatalities at our operations during the year;• A lost time injury frequency rate (LTIFR) of 0.6 Lost Time Injuries • per million exposure hours was achieved, down from 0.8 in the previous year; andTotal recordable injury frequency rate (TRIFR) of 5.8, down from • 7.0 the previous year.

A range of safety management initiatives have been implemented. Further details are available in the Section dealing with Occupational Health and Safety.

EnvironmentAs a mining business, Newcrest is a significant consumer of energy, water and other resources. It is acknowledged that Newcrest has an important role in the efficient management of resources and responsible disposal of materials in order to preserve not only the ecosystems within which the Company operates, but also to mitigate impacts on global issues such as climate change.During the year there was an increase of 25 percent in diesel consumption (measured in litres/tonne of ore processed) across the group. This reflects the inclusion of the Hidden Valley project. Electricity usage per tonne of ore treated increased by 11 percent, this is primarily due to the inclusion of the Hidden Valley project. Electricity for the Hidden Valley project was generated using diesel powered generators in the reporting period. Overall Newcrest’s greenhouse gas emissions increased by 4 percent per tonne of ore treated compared to the previous year. Newcrest continues to evaluate a range of energy conservation, efficiency improvements and greenhouse gas reduction initiatives. Further details are available in the sections on Energy and Emissions, Effluents and Waste.Water usage is measured by the amount of water abstracted from the environment which is either used in the process or stored for later use. The water usage rate increased by 2 percent, in absolute terms over the previous year due to stable water usage across the sites. Further information on water management strategies, is presented in the Section on Water.A number of research programs targeted at delivering more sustainable rehabilitation outcomes at Newcrest’s mine sites continued over the reporting year. These are discussed in the Environment Section. The Telfer Mesa Land Forming project and the Cadia Valley Operations vegetation trial sites at Swallow Creek are examples of these programs.Environmental performance continued the favourable trend of recent years with no major environmental incidents reported. The environmental incident frequency rate (the rate of environmental incidents per million hours of exposure) declined to 2.1, down from 2.2 the previous year and the lowest level since consolidated records began seven years ago.


ORgANISATIONAL PROfILE

OrganiSatiOnal PrOfilENewcrest is Australia’s largest gold producer and one of the world’s top 10 gold mining companies by production, reserves and market capitalisation. Newcrest provides investors with exposure to a portfolio of low‑cost, long‑life operating mines, a strong pipeline of organic growth projects and highly prospective Brownfields and Greenfields exploration projects. The Company has a substantial reserve and resource base, with reserves representing more than 20 years production. Newcrest has the financial strength coupled with extensive technical skills to deliver both organic growth and external opportunities. Key components of the value chain are:

Exploration – the team is acknowledged as one of the most • successful and lowest cost discoverers in the world today;Projects – the current portfolio of development projects and • advanced exploration opportunities represent greater than 50 percent of the Group’s Mineral resource;Operations – comprises a portfolio of seven mines, five mines • in Australia, one in Indonesia and one in Papua New Guinea.

Newcrest is focused on maintaining a safe environment for its employees, operating and developing mines in line with good environmental practices and embracing a strong sense of commitment to the local communities around its operations.Our vision is to be the ‘Miner of Choice’ for all stakeholders, including our employees and contractors, the communities in which we operate and our shareholders.

2.1 name of reporting organisationNewcrest Mining Limited (Newcrest).The data presented in this report are for Newcrest and its controlled entities.

2.2 Primary products and servicesNewcrest is part of the minerals industry, with substantial mining operations in Australia and Indonesia, projects in Papua New Guinea and Fiji and exploration activities in Australia, Indonesia, Fiji and PNG. The industry is a major exporter and provides considerable permanent and contract employment opportunities in a range of services and professions, including those for indigenous people. It is also a major contributor to community development, particularly in rural and regional economies.An annual review of the Australian minerals industry can be found on the Mineral Council of Australia’s website www.minerals.org.au.PrincipalactivitiesNewcrest’s principal activities during the year were exploration, development, mining and the sale of gold and gold‑copper concentrate. There were no significant changes in these activities during the year. Sales during the year amounted to 1,762,200 ounces of gold and 86,816 tonnes of copper.We utilise both our own employees (53 percent of total workforce) and key contractors in our activities.OutsourcingOutsourcing is the concept of taking internal company functions and paying an outside firm to handle them. This is done to save money, improve quality, or free company resources for other activities.

Newcrest makes extensive use of contractors to supplement our own expertise in key areas of our operations. In some instances, this means accessing specialist expertise which we don’t have in‑house (e.g. oversize tyre repair), but in other areas, contractors are partners in our production chain.We have a number of long‑term, or partnership, contractors who undertake critical components of our operation (e.g. underground mining, maintenance, etc.), and whom we consider part of our workforce. Of our total workforce, 47 percent are long‑term contractors which has remained the same as last year.

2.3 Operational structureNewcrest Mining Limited is an Australian publicly owned company (ABN 20 005 683 625) and is listed on the Australian Stock Exchange (Ticker NCM). As at 31 August 2010 it had 40,876 ordinary shareholders. Newcrest is headquartered in Melbourne (Australia), and has 5 operating locations and other Exploration and Project Areas:

Cadia Valley (Central New South Wales), 100 percent owned • by Newcrest, and comprising the:

Ridgeway underground mine Gold‑Copper Mine;• Cadia Hill open pit Gold‑Copper Mine; and• Development of underground mine Cadia East;•

Telfer Gold‑Copper Mine (North‑western Western Australia), • 100 percent owned by Newcrest;Cracow Gold Mine (Central Queensland), a joint venture • owned 70 percent by Newcrest and 30 percent by Catalpa Resources Limited;Gosowong Gold Mine (Halmahera Island, Indonesia), a joint • venture owned 82.5 percent by PT Nusa Halmahera Minerals (Newcrest) and 17.5 percent by PT Aneka Tambang, and comprising the Kencana underground mine;Morobe Mining Joint Venture (Papua New Guinea), a joint • venture 50 percent owned by Newcrest and 50 percent owned by Harmony Gold Mining Company. This operations includes the Hidden Valley mining operation and the Wafi‑Golpu tenements, as well as significant exploration tenements on the Morobe coast;Namosi Joint Venture (Fiji), a joint venture between Newcrest, • Nittetsu and Mitsubishi Minerals, with Newcrest having a 69.94 percent interest in the joint venture. The Namosi tenement is located about 30 kilometres west of Fiji’s capital city, Suva.

Note: For the purpose of this report:Cadia Valley is used as a collective name for the Cadia Hill, Ridgeway and Cadia East operations (which have a common management structure and share key infrastructure); andGosowong is used as a collective name for the Kencana mine, the mined‑out Gosowong and Toguraci pits and the common infrastructure.LGLMergerThe merger of Newcrest Mining Limited and Lihir Gold Limited (LGL) occurred on 13 September 2010. Information contained in this report does not include LGL information.



2.4 location of headquartersNewcrest’s headquarters is located in Melbourne, Australia. Other main offices are located in Brisbane and Perth.Registered and Principal Office Newcrest Mining Limited Level 8, 600 St Kilda Road Melbourne, Victoria 3004 Australia Telephone: +61 (0)3 9522 5333 Facsimile: +61 (0)3 9525 2996 Email: [email protected] Internet: www.newcrest.com.au

2.5 Countries of operationNewcrest operates in a number of different locations around Australia, Indonesia and Papua New Guinea. It has mining and development operations in Australia, Indonesia and Papua New Guinea, and exploration activities concentrated in Australia and the Asia Pacific region and Joint Ventures to explore for copper and gold in Fiji and Papua New Guinea.OperationsNewcrest now has seven operating mines: Cadia Hill, Ridgeway, Telfer (open pit and underground), Gosowong, Cracow and Hidden Valley, located in five distinct mineral provinces. Details of these operations can be found on the Newcrest Mining limited website (www.newcrest.com.au) and information on mineral resources and ore reserves can be found in the Newcrest Mining Limited Concise Annual Report 2010.ExplorationSince inception, Newcrest has been an active and successful explorer and has based its strategy for growth primarily on exploration discovery. As a result of the success of this strategy, Newcrest is one of the few major mining companies in the world that can claim to have discovered every deposit it is presently mining.Newcrest’s total exploration expenditure in 2010 was $101.1 million. Details of exploration activity are also provided in Newcrest’s Annual Report 2010.

2.6 nature of ownershipNewcrest Mining Limited is an Australian publicly owned company (ABN 20 005 683 625) and is listed on the Australian Stock Exchange (Ticker NCM). As at 31 August 2010 it had 40,876 ordinary shareholders.Newcrest may also be traded in the form of American Depositary Receipts (ADRs). Each ADR represents one Newcrest ordinary share. ADR holders are not members of the Company, but may instruct The Bank of New York as to the exercise of voting rights pertaining to the underlying shareholding. During the year the net movement for ADRs was positive 5,266,755 and at year end a net 14,381,872 ADRs were outstanding.

2.7 markets servedNewcrest operates predominately in the gold mining industry and derives its revenue from the sale of gold bullion and gold‑copper concentrate. Our gold bullion is sold to mints for refining, and our gold‑copper concentrate is sold to copper smelters for refining to gold and copper metal.A geographic breakdown of our sales is shown in the table below.

SalesRevenuefrom ExternalCustomers ($ million)

2010 2009

BullionAustralia 981.3 858.2Other Asia 2.2 1.8

ConcentrateJapan 769.6 989.7Korea 130.3 134.6China 154.9 103.8Europe 670.6 364.2USA 92.9 78.5

Totalsalesrevenue 2,801.8 2,530.8

2.8 Scale of reporting organisationFor the 2010 year the Company produced a full year profit after tax of $556.9 million. The financial overview of the Company’s performance is shown in the following table. 30June 30June 2010 2009

Gold Produced (ounces) 1,762,200 1,631,183

Copper Produced (tonnes) 86,816 89,877

Gold Price realized ($/ounce) 1,252 1,169

Sales revenue ($ million) 2,801.8 2,530.8

Operating EBIT ($ million) 1,127.4 772.6

Underlying Profit ($ million) 767.3 483.1

Statutory Profit ($ million) 556.9 248.1

Cash flow from Operations ($ million) 1,303.3 1,024.1

Capital Expenditure (cash flow basis including Exploration ($ million) 886.5 1,381.6

EPS on underlying profit (cents) 158.0 103.2

Return on capital employed (ROCE) (percent) 24 17

Gearing (Net debt/net debt plus equity) (5) 2

2.9 Significant changes during the reporting periodSignificant changes in the state of affairs of Newcrest that occurred during the financial year are contained in the Management Discussion and Analysis section of the Annual Report 2010.



2.10 awardsExternalawardsGosowong wins national environmental and safety awardsGrowing 40 plant species for post mine rehabilitation is one of the initiatives which helped Newcrest’s operation in Indonesia, PT Nusa Halmahera Minerals (PT.NHM), win silver at last year’s Government – sponsored Safety and Environment awards in December.‘With no seedlings supplier on Halmahera Island (on which PT.NHM’s mine site Gosowong is located), our nursery has an important role in supplying plants for rehabilitation. We have a range in stock, the majority of which are local species,’ says Winarto Sudewo, Manager Environment.Silver was awarded to PT.NHM by Indonesia’s Department of Energy and Mineral Resource, which audits over 200 mining companies annually of which only a portion are nominated for an award. In all PT. NHM won silver in six categories which Winarto says is very satisfying: ‘Although we didn’t win gold, it’s nice that our programs for waste dump management, erosion and sediment control, rehabilitation of post mining areas and environmental monitoring are being recognised.’Gosowong’s safety performance also won silver. Head of Safety and Risk Scott Jones says the site has a positive safety culture: ‘They’re proactive and always trying to improve their practices.’The Minister’s Award for Excellence for Employers of Australian Apprentices for Western NSWNewcrest’s Cadia Valley Operations (CVO) Engineering Fabrication Apprentice Alex Hausfeld beat stiff competition to be named Western Region New South Wales Apprentice of the Year at the prestigious 2010 State Training Awards held in Orange, NSW.Alex was judged on criteria including her performance at TAFE and work, her community interests and involvement and her ability to act as an ambassador for apprenticeships. Winning this award has allowed Alex to compete in the State titles.This is the first time a Newcrest site has won an award since the event began in 2007. The annual national awards recognise outstanding achievements and best practice in apprentice training.

InternalAwardsNewcrest’s Gosowong Operations topped Newcrest Annual Safety Awards for the 2010 financial year. The two Safety Awards for top performing and most improved department are given out annually after the reported performance is audited. The Top Performing Department prize is Gosowong Ore Treatment, followed closely by Gosowong Underground as the Most Improved Department. Geoff Day, former Newcrest Chief Operating Officer Offshore says the ‘Gosowong is doing a good job in raising it’s standards with improved safety practices. This is an excellent outcome. It shows that a focus on leading activities like See Stop Control in an operation can make a huge difference to outcomes.’ Both departments received a prize of $10,000, and was donated to charities of their choice.Newcrest established Safety Awards several years ago to measure a range of activities including hazard and near‑miss reporting, timely completion of safety improvement actions and total recordable injury rates.


REPORT PARAmETERS

rEPOrt ParamEtErSOur seventh Global Reporting Initiative G3 Guidelines‑based Sustainability Report covering the 2010 financial year was posted on our website in early 2011. We have chosen to publish our Sustainability Report online because it enables readers to access links to a range of supporting documentation. These documents provide greater detail on key aspects of our sustainability performance.We will continue to build our Sustainability Report in coming years to cater for the diverse requirements of our key stakeholder groups.

rEPOrt PrOfilE

3.1 reporting parametersReporting periodInformation in this report covers the period 1 July 2009 to 30 June 2010, unless otherwise stated. Throughout this report, reference to a year (e.g. 2010) means the 12 months to June of that year (i.e. 1 July 2009 to 30 June 2010).Units of measurementUnits of measurement used in this report can be found in a Supporting Document titled Units of Measurement.Throughout this report the standard monetary unit is the Australian Dollar (A$).Definitions and acronymsDefinitions and acronyms used in this report are contained in a separate Supporting Documents.We have also included a list of references used in preparing this report.Additional informationAdditional information is supplied in numerous places throughout this report by way of Supporting Documents. These documents provide more detail on key topics identified in sections of the main report. Supporting Documents can be accessed by a left mouse‑click on highlighted words.

3.2 most recent reportOur most recent Sustainability Report covered the period 1 July 2008 to 30 June 2009, and was released in early 2010.The report, hosted on our website, provided a comprehensive overview of our economic, social and environmental performance. We chose to present our report in electronic format so that we could provide links to important additional material necessary for an understanding of our overall performance.A summary of each of our annual Sustainability Reports (covering the period 2002 to 2008) and a full PDF version of the 2009 report are maintained on our website.

3.3 reporting cycleThe reporting cycle for the Newcrest Sustainability Report is annual. It is based on the financial year (1 July to 30 June) which is consistent with our other corporate reports.

3.4 Contact personGregMorris (Head of Environment) PO Box 6213 St Kilda Road Central Melbourne, VIC 3004 Australia www.newcrest.com.auFeedback on this report can be provided in two ways:

access the • feedback form attached to this report, fill it in, and return it to us; orreply directly by email on the feedback email address • [email protected].

rEPOrt SCOPE anD BOunDary

3.5 Processes for defining report contentThe GRI Reporting Framework provides Reporting Principles and Reporting Guidance to help define report content, ensure the quality of reported information, and set the Report Boundary. A detailed discussion on the GRI Reporting Principles and their relevance to this report is contained in a separate document.The scope of the report, and the depth of reporting, is governed by two key criteria; our industry and our audience.OurindustryThe nature of the mining industry, and in our case the gold and copper mining industry, means that some elements of the GRI G3 Guidelines are more significant than others. In defining the scope of our report, we have deviated from the GRI Reporting Framework by applying more or less emphasis to key sections of the Framework as follows:Sections where more emphasis is applied1. Indigenous RightsIn the GRI G3 Guidelines, Indigenous Rights are covered under one performance indicator (HR9) and in the Mining and Metals Sector‑ Specific Supplement (2010) under the commentary on HR 9, aspect Indigenous Rights (MM5), SO1 Society and Performance Indicator, aspect Community (MM 6 & 7). As two of our operations (Telfer and Cracow) are in areas of Australia with indigenous populations, this topic is of great importance to us. We have put considerable effort into ensuring that this topic reflects its importance to us. Indigenous populations in both Indonesia and PNG are the dominant populations and we have covered these issues under Community rather than Indigenous Rights.The GRI Reporting Framework encourages organisations to develop Company Specific indicators in areas where the Framework itself is considered deficient. We have included the following Company Specific (CS) indicators in the Human Rights Section of this report:CS1 Indigenous communities; CS2 Indigenous agreements; equivalent to Mining and Minerals

Sector Specific MM5 Indigenous Rights;CS3 Aboriginal cultural heritage; and CS4 Contributions to Indigenous communities.


REPORT PARAmETERS

2. CommunityIn the GRI G3 Guidelines, Community is covered under one performance indicator (SO1), and in the Mining and Metals Sector Supplement under four additional indicators (MM6, MM7 and MM9), and to some degree under MM10. Our relationship with our local communities is a vital component of our operations, and additional coverage has been given to this topic. We have included the following Company Specific indicators in the Society Section of this report:CS5 Community involvement; CS6 European heritage; and CS7 Contributions to local communities.Sections where less emphasis is applied3. Economic performance indicatorsAs a public company, Newcrest’s accounts are audited on a regular basis, and the Company publishes an Annual Report which is made available to all shareholders and is placed on our website. This financial report covers the same period (financial year) as the Sustainability Report, and provides comprehensive coverage of the Company’s financial performance. Whilst frequent reference is made to the annual report in this Sustainability Report, no attempt has been made to include a comprehensive coverage of economic indicators. For those who wish to read a detailed review of the Company’s economic and financial performance please refer to the information contained in the annual report.4. Product Responsibility performance indicatorsOur two main end products are gold and copper concentrate. Gold is an inert mineral, and copper is recycled. In addition, we do not sell our products direct to the public, but to refineries or smelters for secondary treatment. For these reasons, the Section on Product Responsibility performance indicators is not of great significance.OuraudienceWe have identified our stakeholders in Section 4.13. Of these groups, capital market participants and non‑governmental organisations are most likely to read broadly through the report in order to satisfy their respective constituencies. The other stakeholder groups (shareholders, local communities, employees and contractors, customers, suppliers and regulators) are more likely to access the report selectively. The structure of the report makes access easy for all stakeholders.

3.6 Boundary of the reportThis report covers all our activities world‑wide. We have operating mines and development projects in Australia and Indonesia, and exploration activities in Australia, Indonesia, Papua New Guinea, the United States of America and South America. The report covers the activities of all wholly‑owned Newcrest entities, plus any joint‑venture entities where Newcrest is the manager/operator, including the:

Gosowong Gold Mine joint venture, owned 82.5 percent • by PT Nusa Halmahera Minerals (Newcrest) and 17.5 percent by PT Aneka Tambang;Cracow Gold Mine joint venture, owned 70 percent by Newcrest • and 30 percent by Sedimentary Holdings;

Namosi Joint Venture (Fiji) is a Joint Venture between Newcrest • Mining Ltd (69.94 percent), Nittetsu Mining Company (2 percent) and Mitsubishi Materials Corporation (28.06 percent); andMorobe Mining Joint Venture (Papua New Guinea), a joint • venture 50 percent owned by Newcrest and 50 percent owned by Harmony Gold Mining Company.

3.7 Specific limitations on the scope of the reportThere are no specific limitations on the scope of this report.This report covers Newcrest Mining Limited and its controlled entities. It does not cover non‑managed joint venture projects (see Section 3.8 below). It covers the worldwide operations of Newcrest, including operating mines in Australia and Indonesia, and exploration activities in Australia, Indonesia, the United States of America and South America.

3.8 Basis for reporting on Joint VenturesAs a guiding principle, Joint Venture entities in which Newcrest holds a minority stake and is not the manager/operator are not included in this report.Although Newcrest does not report on the sustainability performance of Joint Ventures which it does not manage, the preamble to Newcrest’s Community, Safety & Health, and Environmental Policies state that:‘Newcrest will use all reasonable endeavours to apply the relevant principles of these Policies to operations in which it holds a non‑controlling interest’.JointVenturesincludedinthisreportCracow Gold Mine (Central Queensland, Australia), is a joint venture owned 70 percent by Newcrest and 30 percent by Catalpa Resources. The Joint Venture is managed and operated by Newcrest.Gosowong Gold Mine (Halmahera Island Indonesia) is a joint venture owned 82.5 percent by PT Nusa Halmahera Minerals (Newcrest) and 17.5 percent by PT Aneka Tambang. The Joint Venture is managed and operated by Newcrest through PT Nusa Halmahera Minerals.Namosi Joint Venture (Fiji) is a Joint Venture between Newcrest Mining Ltd (69.94 percent), Nittetsu Mining Company (2 percent) and Mitsubishi Materials Corporation (28.06 percent).Morobe Mining Joint Venture (Papua New Guinea), a joint venture 50 percent owned by Newcrest and 50 percent owned by Harmony Gold Mining Company.


REPORT PARAmETERS

3.9 Data measurement techniquesWe have reported upon data in this Sustainability Report that has been sourced using a variety of data measurement techniques and management processes. This section provides an overview of the various techniques and processes involved.DatameasurementData collection and monitoringData are systematically collected using a range of methods and aggregated at the site and Group level. Where applicable this has included the following:

data collection and monitoring;• data calculation; and• data estimation.•

Monitoring involves the collection of raw data, quality control (of equipment, analysis and data) and data storage. Monitoring can be real‑time (continuous), or vary from a few seconds (some meteorological parameters) to daily, monthly or annually. The frequency of monitoring is determined by the nature of the parameter being monitored, and the need to report results in a timely manner for review and action. All operations routinely report monitoring results to their respective regulatory authorities.Data calculationIn some instances, the data presented in this report has been calculated rather than measured. The best illustration of this process is in the calculation of greenhouse gas emissions.The Australian Government, Department of Climate Change National Greenhouse Accounts (NGA) Factors is designed for use by companies and individuals to estimate greenhouse gas emissions for reporting under various government programs and for their own purposes. The default emission factors listed in this document have been estimated by the Department of Climate Change using the Australian Greenhouse Emissions Information System and are determined simultaneously with the production of Australia’s National Greenhouse Accounts.Greenhouse gas emissions are calculated by taking measured data such as litres of diesel consumed or megawatt hours of electricity used and applying the emission factors in the NGA Factors to arrive at carbon dioxide equivalent emissions.Data estimationData estimation is the most imprecise method of generating information for inclusion in this report. The accuracy of the estimation will depend on the quality of the input data and the accuracy of the estimation technique used. Data estimation is illustrated by reference to the National Pollutant Inventory.The National Pollutant Inventory (NPI) is a public internet database that displays information about the emissions from industrial facilities and diffuse sources (www.npi.gov.au). Every year Australian industrial facilities that use certain amounts of the 93 NPI substances must estimate and report their emissions directly to their state or territory environment agency.

Every NPI substance that trips a threshold must be reported as an emission to air, land and/or water from both point and fugitive sources where appropriate. Information and guidance on how to go about estimating the emissions from specific industry processes is available in the Emission Estimation Technique Manuals specially developed for industry sectors.Newcrest routinely estimates its emissions under NPI for our Australian operations and reports them annually. NPI estimates for such substances as sulphur dioxide are reported in this Sustainability Report.DatamanagementData presentationData is presented in two principal forms in this report:

as absolute figures; raw performance data per year for • the Group or for individual operations; oras normalised data; which is a ratio between two absolute • figures. Two common ratios are used:1. tonnes treated through the process plant, which is

a measure of the level of production across the group (e.g. kg of CO2e per tonne treated); and

2. million man hours; which is a measure of the level of activity across the Group for a defined period (e.g. number of reportable environmental incidents per million man hours). This is an industry standard measure for safety statistics, and has been adopted here for assessing some environmental parameters.

3.10 re‑statements and clarificationsChanges to dataThe following changes have been made to data contained in previous reports:

minor changes to data identified through an internal review • process and/or external verification are corrected in the data sets but not individually identified unless they are material in nature.

3.11 Changes since the previous reportNo changes to report.


REPORT PARAmETERS

gri COntEnt inDEx

3.12 location of standard disclosuresGRIReportingFrameworkdocumentsNewcrest made a decision in early 2006 to adopt the GRI G3 Guidelines as the basis for its 2006 Sustainability Report. The GRI Reporting Framework documents have been used to develop this Sustainability Report, and can be found on the GRI website.StandarddisclosuresThis Sustainability Report is structured around the GRI G3 Guidelines. Each of the key headings (and most of the reporting elements) are reproduced in this report in the same sequence as the G3 Guidelines and are represented by theorangealpha/numerals.Performance indicators from the Mining and Metals Sector Supplement are included in the appropriate sections in the report, and are identified by the bluealpha/numerals.A GRI Content Index is attached for easy reference.ApplicationlevelsThe GRI Reporting Framework has defined Application Levels which provide report readers with a clear indication of the level to which the Framework has been applied. A GRI Application Level grid is included below to show which level is being declared, and who has made this assessment. The ‘plus’ (+) indicates that the report has been externally assured. C C+ B B+ A A+

Mandatory Self Declared

Optional Third Party Checked

GRI Checked

aSSuranCE

3.13 independent assuranceThe GRI Reporting Framework sets out a number of key qualities for external assurance of reports. They are that it:

is conducted by groups or individuals external to the • organisation who are demonstrably competent in both the subject matter and assurance practices;is implemented in a manner that is systematic, documented, • evidence‑based and characterised by defined procedures;assesses whether the report provides a reasonable and • balanced presentation of performance, taking into consideration the veracity of data in a report, as well as the overall selection of content;utilises groups or individuals to conduct the assurance who are • not unduly limited by their relationship with the organisation or its stakeholders to reach and publish an independent and impartial conclusion on the report;assesses the extent to which the report preparer has applied • the GRI Reporting Framework (including the Reporting Principles) in the course of reaching its conclusions; andresults in an opinion or set of conclusions that is publicly • available in written form and a statement from the assurance provider on their relationship to the report preparer.

In line with these elements, we engaged Environmental Resources Management Australia Pty Limited (ERM) to provide independent assurance of our 2010 Sustainability Report (2010 Report) to the agreed scope of work outlined below.ERM is a global sustainability consultancy with over 3,000 staff working in more than 40 countries. ERM has extensive experience of sustainability report assurance, and a multi‑disciplinary team of environmental, sustainability and assurance specialists performed the engagement. During 2010, ERM did not work with Newcrest or its subsidiaries on other consulting engagements.ScopeofWorkThe 2010 Sustainability Report covers Newcrest’s operations for the 12 months to 30 June 2010, unless stated otherwise in the text. The subject matter for this assurance process consisted of adherence to the AA1000AS (2008) Principles of Inclusivity, Materiality and Responsiveness and review of the following material data streams: land, biodiversity, water supply, wastewater discharges, closure, energy use and greenhouse gas emissions, waste rock and tailings management, and community.Work was performed to provide Type 2 moderate assurance using ERM’s assurance methodology, which is in accordance with the AA1000 Assurance Standard (2008), against which ERM reviewed Newcrest’s performance reporting.For more details on ERM’s activities and conclusions, please see their independent Assurance Statement.


gOvERNANCE, COmmITmENTS ANd ENgAgEmENT

gOVErnanCE, COmmitmEntS anD EngagEmEntNewcrest’s vision is to be the ‘Miner of Choice’ – to maintain its position as a leading producer of gold, creating shareholder wealth in a manner which also benefits its employees and the communities and environment in which it operates.The 2010 Annual Report contains a summary of Newcrest’s corporate governance practices during the year to 30 June 2010. The Annual Report includes information required under the ASX Corporate Governance Councils ‘Corporate Governance Principles and Recommendations’ (August 2007).

gOVErnanCE

4.1 governance structure of the organisationAt 30 June 2010, Newcrest’s Board comprised eight Directors – the Managing Director, Mr Ian Smith, the Finance Director, Mr. Greg Robinson and six Non‑Executive Directors, being Mr Don Mercer (Chairman) and Messrs, Tim Poole, John Spark, Rick Lee, Richard Knight and Vince Gauci.On behalf of the shareholders, the Board:

sets the Company’s strategic goals and objectives; and• oversees the management and performance of the • Company’s business.

These and other functions of the Board, and by exception the functions delegated to management, have been formalised through the adoption of a formal Board Charter.The Board Charter defines the Board’s role and responsibilities in relation to strategic, financial, operational and governance matters. It makes it clear that the role of the Board is not to manage the Company but to set, on behalf of the shareholders, the strategic direction of the Company and to review, oversee and monitor the management and performance of the business by the Company’s senior executive team.BoardCommitteesTo facilitate the execution of its responsibilities, the Board operates three standing Committees. The operation of the Committees provides a forum for more detailed analysis of key issues. In addition, the Board operates an ad hoc Executive Committee which is convened as required. All Directors receive all Committee papers and minutes and are welcome to attend any Committee meeting. Each Committee reports its deliberations to the next Board meeting.The Board does not have a nominations committee as that role is dealt with by the Board itself. The Board took this step having determined that it was best placed to undertake the work of that committee having regard to the size of the Company, and that all decision making authorities in relation to the work of a nominations committee rest with the Board itself. The Board has structured its annual program of business to ensure that nomination matters are fully dealt with by it.In February 2009, the role of the Remuneration Committee, which was undertaken by all non‑executive members of the Board, was expanded to cover not only remuneration but also broader human resources issues. It was renamed the Human Resources and Remuneration Committee and four non‑executive Board members were appointed to take on its expanded role and workload. Executive Directors are invited to attend as appropriate.

The current Committees of the Newcrest Board, their membership and functions are as follows. Each of the Audit and Risk Committee, Human Resources and Remuneration Committee and Safety, Health and Environment Committee has its own charter.Audit and Risk CommitteeMembers: John Spark (Chairman), Rick Lee and Tim Poole and Richard Knight.Function: ensures compliance with all accounting and financial reporting obligations of the Group and reviews internal financial controls and the role of the internal and external auditors, including the independence of the external auditors, and the Company’s risk management activities.Human Resources and Remuneration CommitteeMembers: Don Mercer (Chairman), Rick Lee, Tim Poole and Vince Gauci (Executive Directors, Ian Smith and Greg Robinson may attend by invitation).Function: deals with all matters relating to the Company’s Human Resources Policy, including executive and employee remuneration levels and remuneration matters generally.Safety, Health and Environment CommitteeMembers: Richard Knight (Chairman), Vince Gauci and John Spark.Function: monitors the Company’s safety, health and environmental management practices and ensures that the Company has appropriate policies in place to provide a framework for compliance with all relevant laws, regulations and standards, and oversees safety, health and environment risk management.Board Executive CommitteeMembers: Don Mercer (Chairman), Ian Smith (Managing Director) and at least one Non‑Executive Director.Function: acts as a delegate for the Board to make decisions where it is not practical or reasonable to convene the Board.The Charter for each Board Committee can be found at: www.newcrest.com.au/corporate.asp.

4.2 Board independenceThe Board has determined that all Non‑Executive Directors are independent and free of any relationship which might conflict with the interests of the Company. All Directors are required to disclose their relevant interests and to give notice of any potential conflict of interest. The Board has in place processes for dealing with a conflict of interest or loss of independence by a Director, should that situation arise. The Board will continue to monitor the independence of each Director and will periodically review its approach to assessing director independence.All Directors have direct access to all relevant Company information and to the Company’s senior executive. The Board has adopted a formal policy, which ensures that Directors also have access to independent legal, accounting or other professional advice as necessary at the Company’s expense.



4.3 Shareholder communicationThe Board recognises the importance of keeping the market fully informed of the Company’s activities and stakeholder communication in a timely and balanced manner. In this respect, Newcrest already complies with the new listing rule requirements concerning analyst briefings, which have effect from 1 January 2011.Our Continuous Disclosure Policy ensures that Company information considered to be material is announced immediately through the ASX and key presentations given by Company personnel to investors and institutions are also lodged with the ASX. The Company Secretary has primary responsibility for coordinating disclosure in accordance with the Policy.Key communications are placed immediately on the Company website and provided directly to all shareholders as necessary. General and historical information about the Company and its operations is also available on the website.It is the Board’s policy that the Company implements effective communication with its shareholders. Under the guidance of Newcrest’s Company Secretary and its EGM People, Communication and Environment, this is achieved through:

complying with ASX listing rules and Corporations Act • reporting requirements;webcasting half‑year and full‑year financial • results presentations;ensuring continuous disclosure compliance;• holding an accessible and informative • Annual General Meeting; andposting on the Company’s website all other ASX announcements • including briefings to investors and analysts and presentations by the Company to public forums.

Shareholders may receive electronic versions of the annual report and other key shareholder communications, including notices of meeting, electronically.At its Annual General Meeting the Company’s auditors are available to answer questions relating to the audit of the Company’s financial statements and the accounting policies adopted by the Company in the preparation of its financial statements. Newcrest’s Chairman encourages shareholder questions at the Company’s Annual General Meeting and shareholders unable to attend are given the opportunity to submit questions to the Chairman prior to the meeting.

4.4 Executive compensationDirectors’FeesThe Company’s Human Resources and Remuneration Committee deals with all matters relating to the Company’s remuneration policy, executive and employee remuneration levels and remuneration matters generally. A copy of the Human Resources and Remuneration Committee Charter is available on the website at www.newcrest.com.au/corporate.asp.Remuneration of Non‑Executive Directors is fixed rather than variable so that Board membership of a high standard is maintained and market remuneration trends reflected.It is determined so that Board membership of an appropriate calibre is maintained and is in accordance with remuneration trends in the marketplace. Remuneration levels and trends are assessed every 2 years with the assistance of professional independent remuneration consultants and adjusted where necessary to align with Board remuneration levels in comparable Australian listed companies.The total ‘fee pool’ for Non‑Executive Directors must be approved by ordinary shareholders and presently stands at $1,800,000.ExecutiveRemunerationOur Remuneration Policy recognises the different levels of contribution within management to the short‑term and the long‑term success of the Company. A significant proportion of each senior manager’s remuneration is placed ‘at risk’ and dependent upon both personal and Company performance, formally appraised each year.The Board has established with the Managing Director specific personal and corporate performance objectives for the short and long term. The performance of the Managing Director is formally assessed against these objectives annually. The assessment helps determine the level of ‘at risk’ remuneration paid to the Managing Director.Details of the Company’s policies and practices in relation to both Director and employee remuneration, and how they relate to Company performance, are set out in Remuneration Report section of the Annual Report.

4.5 Board membershipSelectionandAppointmentofDirectorsThe Board regularly reviews its membership to ensure that it offers the range of business skills and expertise demanded by the Company’s operations. When a Board position becomes vacant or additional Directors are required, candidates are identified, using external professional advisers if necessary. Candidates are considered and appointed by the full Board. Appointment of the Managing Director is made by the full Board, with professional advice taken if necessary. All Board appointments are subject to shareholder approval.



4.6 Vision, Strategy, Values and PoliciesNewcrest’s mission, values and policies outlined below are applicable across the Company regardless of geographical location.VisionOur vision is to be the ‘Miner of Choice’ for all stakeholders, including our employees and contractors, the communities in which we operate and our shareholders.StrategyNewcrest pursues a strategy of delivering competitive shareholder returns by:

building a portfolio of low‑cost, long‑life gold assets, primarily • through exploration and a focus on early entry merger and acquisition prospects in known gold regions;optimising performance at each phase of the gold mining value • chain; andharnessing its technical expertise across a wide range of mining • and processing methods.CorporateResponsibilityNewcrest is focused on maintaining a safe environment for its employees, operating and developing mines in line with good environmental practices and embracing a strong sense of commitment to the local communities around its operations.Building and maintaining sound relationships with the communities surrounding Newcrest’s operations is a key component of being the ‘Miner of Choice’.ValuesNewcrest has formulated and adopted five key values to guide its employees in the conduct of the Company’s activities. The agreed values that guide our everyday behaviours and frame how we ‘Do the Right Thing’ are:

We work together.• We care about people.• We act with integrity and honesty.• We value innovation and problem solving.• We seek high performance in ourselves and others.•

An extensive training program has been developed to educate employees in the Newcrest values and to encourage them to do the right thing in accordance with these values.PoliciesThe Company has a formal Code of Conduct, which all Newcrest Directors, employees and contractors are required to observe, and a comprehensive range of corporate policies (Risk Management, Communities, Safety & Health and Environmental) which detail the framework for acceptable corporate behaviour. These set out procedures employees are required to follow in a range of areas including share trading, employment practices and compliance. The Company policies are reviewed periodically to ensure that they meet evolving stakeholder expectations and community standards, and have been translated into Bahasa Indonesian to facilitate adoption at our Indonesian operations.Directors’ and employees’ shareholdings and share trading are subject to the Company’s Securities Dealing Policy, which restricts the times when a Director or employee can purchase or sell Company securities, and prohibits short‑term trading.

4.7 risk management and internal ControlsThe Board recognises that risk management and internal controls are fundamental to sound management, and that oversight of such matters is a key responsibility of the Board. Newcrest has a detailed risk management and internal control framework incorporating policies and procedures, which set out the roles, responsibilities and guidelines for identifying and managing material business risks.The board reviews the effectiveness of management’s implementation of risk management and of the internal control systems at least annually. The Audit and Risk Committee assists the Board with respect to oversight of risk management policy and of effective internal controls and risk management processes.ManagementofRiskNewcrest’s Risk Management Framework is used to identify and evaluate risk events, establish robust controls and mitigation strategies, and to provide an assurance process in relation to effectiveness and implementation of these. The aim is to provide an overarching, uniform and consistent framework for identifying, assessing, monitoring and managing material business risks across the spectrum, being:

strategic, corporate and commercial, major hazard • (including operational, safety and environmental) and project management risks.

The risk profiles, including identification and assessment of related controls, are reviewed and updated by management and reported to the Audit and Risk Committee at least annually.InternalControlFrameworkNewcrest has controls in place that are designed to support the risk management framework, safeguard the Company’s interests and ensure the integrity of its financial reporting.Key controls in place include:

An integrated, robust planning and budgeting process delivering • a 5 year strategic plan and linked detailed budget annually (both subject to the approval of the Board). Progress against performance targets is reported against monthly and supplemented regularly with forecast updates;A comprehensive capital approval process controlling • the authorisation of capital expenditure and investments. Key capital decisions are subject to independent technical and commercial review;A system of delegated authorities that cascades authority • levels for expenditure and commitments from the Board, the delegation to the CEO and the further cascading of authorities from the CEO to the rest of the organisation;Appropriate due diligence procedures for acquisitions • and divestments;The annual preparation of a capital management plan setting • out the key capital structure, liquidity and cash flow at risk objectives of the Company. In addition, Treasury has detailed policies for the management of debt and currency, investment of surplus cash and interest rate risk management;A system of financial control processes to ensure the integrity • of financial reporting;Each half‑year, the completion by management of a detailed • internal control questionnaire covering financial stewardship, legal and risk issues; andRegularly reviewed and tested crisis management and • emergency management systems.



InternalAuditThe Company has an independent internal audit function, currently resourced by KPMG and reporting to the Director Finance, which undertakes audits of critical finance and business processes and tests key internal controls. The annual audit plan, which is approved by the Audit and Risk Committee, is structured to cover all material operating sites and processes on a rolling program. Findings are reported to senior management and the Audit and Risk Committee and corrective actions are monitored, reviewed and reported. Material findings are reported to the Board. The internal audit function and the Audit and Risk Committee have direct access to each other and have the necessary access to each other and have access to management to seek information and explanations.ManagementAssuranceAt the Board meeting to approve Newcrest’s annual and half‑yearly results in 2010, the Board received and considered statements in writing from the Managing Director and Chief Executive Officer and Director Finance in relation to Newcrest’s system of risk oversight and management and internal compliance with internal controls. These assurance statements were supported by an internal process of compliance confirmations by Executive General Managers and General Managers responsible for operations and key functions. The certificate of assurance stated that the financial statements have been prepared in conformity with generally accepted accounting principles and that they gave a true and fair view of the state of affairs of the Company. The certificate of assurance also stated that the risk management and internal compliance and control systems were operating effectively in all material respects in relation to the reporting of financial risks.

4.8 Board performanceBoardPerformanceEvaluationThe Board undertakes an annual review of its own performance effectiveness and that of its Committees and individual Directors. This may occur through a process consisting of internal review led by the Chairman, or may in some years be performed with the assistance of external advisers as may be deemed appropriate.For the 2010 reporting period, this process was led by the Chairman based on a formal questionnaire and evaluation provided by each Board member. The outcomes of the evaluation were reviewed and considered by the Board. The Chairman concluded that in respect of the 2010 reporting period, the Board and each of its committees were operating well, with no areas of concern to be addressed.Consideration to improve the functionality and performance of the Board and its Committees occurs at regular intervals and the practice of having all Directors present at all subcommittees is strongly supported.

ExecutivePerformanceEvaluationThe Company has in place a performance appraisal system for executives that is designed to optimise performance. Details regarding the Newcrest performance management system for the period 2010 are set out in the Remuneration Report.Each of the Company’s senior executives (including the Managing Director and Chief Executive Officer and the Director Finance) have undergone performance evaluation during the 2010 reporting period in accordance with the Company’s Work Performance System.BoardaccesstoadviceAll Directors have direct access to all relevant Company information and to the Company’s senior executives. The Board has adopted a formal policy which ensures that Directors also have access to independent legal, accounting, or other professional advice, when necessary, at the Company’s expense.

COmmitmEntS tO ExtErnal initiatiVES

4.9 the precautionary approachNewcrest operates seven mines in Australia and overseas (Cadia Hill, Ridgeway, Telfer open cut and underground, Cracow, Gosowong and Hidden Valley). Newcrest is also operator and major shareholder (82.5 percent) in the Gosowong mine in Indonesia and a 50:50 joint venture partner with Harmony Gold Mining Company in Papua New Guinea where the Hidden Valley mine was commissioned.Each underwent an extensive formal assessment of their economic, social and environmental impacts prior to gaining development approval. In each case the relative merits of the development have been assessed, and where necessary, management programs have been implemented in accordance with the precautionary principle.The projects, when they gained approval, and the statutory impact assessment process they went through, are listed below.

Cadia Hill (1995) New South Wales • Environmental Impact Statement (EIS) and Public Enquiry;Ridgeway (2002) New South Wales EIS and Public Enquiry;• Cracow (2001) Queensland • Environmental Management Overview Strategy and Plan of Operations;Telfer (2002) Western Australian • Notice of Intent/Additional Referral Information (Mine & Borefield) and Environmental Protection Statement (Power Supply and Infrastructure Corridor); Kencana (Gosowong) (2006) Indonesian Environment Impact Study;Hidden Valley (2004) Papua New Guinea Social Environment • Impact Statement; andCadia East Project (2010) New South Wales • Environmental Assessment.

Additional supplementary approvals for operational changes have been obtained where required under legislation. After commencing operations, a precautionary approach to decision making is addressed through each mines’ environmental management system, risk analyses of operational changes and stakeholder consultation.



4.10 External codesNewcrest is bound by three key formal codes:

the Australian Minerals Industry (AMI) • Enduring Value Code;the Joint Ore Reserves Committee (JORC) • Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves; andASX Corporate Governance Principles and Recommendations• (August 2007).

In October 2008 Newcrest became a signatory to the International Cyanide Management Institute (ICMI) International Cyanide Management Code for the Manufacture, Transport and Use of Cyanide in the Production of Gold. The Code requires that a ‘Verification Audit’ be carried out by an independent third party professional (chosen by Newcrest from a list of accredited auditors) within three years of the sign on date i.e. October 2011. More details on the Code can be found on the ICMI website: www.cyanidecode.org. Initial gap analysis audits have been undertaken at Telfer, Gosowong and Cracow operations and activities are underway to meet the Code requirements.EnduringValueIn late 2004, the Minerals Council of Australia decided to replace the Code for Environmental Management with a more comprehensive code called Enduring Value (www.minerals.org.au). Enduring Value is a sustainability code based on the International Council on Mining and Metals (ICMM) Framework for Sustainable Development. Enduring Value adopts the ICMM Framework principles and elements and provides implementation guidance in an Australian context. It reflects the three pillars of sustainability (social, economic and environmental), with a strong governance framework.Newcrest became a signatory to Enduring Value in May 2005. As a signatory we have three commitments:

progressive implementation of the ICMM principles • and elements;public reporting of site level performance at least once a year, • with reporting metrics self‑selected from the GRI G3 Guidelines, the GRI Mining and Metals Sector Supplement or self‑developed; andassessment of the systems used to manage key operational risks.• JORCCodeThe measurement and reporting of Newcrest’s Mineral Resources and Ore Reserves conform to the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The Joint Ore Reserves Committee Code – JORC) 2004 Edition. (www.jorc.org). Ore Reserves quoted are a subset of Mineral Resources. Independent external and internal reviews are conducted on all estimates.ASXCorporateGovernanceThe Company’s corporate governance practices include those matters required to be addressed in the 2010 Annual Report by the ASX Corporate Governance Principles and Recommendations (August 2007). Additional information is available on the Company’s website, www.newcrest.com.au.

4.11 industry membershipsNewcrest is committed to working with governments, industry and other stakeholders to achieve appropriate and effective public policy, laws, regulations and procedures that facilitate the mining sector’s contribution to sustainable development. To achieve these objectives, Newcrest works through a number of peak industry bodies in the jurisdictions in which we operate.Newcrest is a member of the following business organisations:

the Minerals Council of Australia;• the New South Wales Minerals Council;• Chamber of Minerals and Energy of Western Australia;• the Australian Mines and Metals Association;• the Australian Safety and Compensation Council;• Corporate Tax Association of Australia;• Indonesian Mining Council;• Australia Fiji Business Council;• Papua New Guinea Chamber of Mines and Petroleum; and• Copper Development Centre (Australia).•

StakEhOlDEr EngagEmEntNewcrest has a formal Code of Conduct which sets out the expectations for appropriate ethical and professional behaviour for Directors and employees of the Company, and which confirms the values that underpin all of Newcrest’s relationships with its stakeholders.

4.12 list of stakeholdersNewcrest recognises that there are a wide range of stakeholders who have an interest in our activities. Our key stakeholders have been identified as:

shareholders;• local communities (including indigenous communities);• employees and contractors; and• capital market participants.•

We also recognise a number of other stakeholder groups which are important to the ongoing viability of our business. They include:

customers;• suppliers;• regulators; and• non‑governmental organisations.•



4.13 Stakeholder identification and selectionWe have identified four groups as our key stakeholders because we believe that they are the most influential of our stakeholders, both in number, and in their involvement with the successful operation of our business.KeystakeholdersShareholdersAt 31 August 2010, the Company had 40,876 shareholders, all holding ordinary shares (see breakdown below).Retail 6%

DomesticInstitutions 19%

InternationalInstitutions 75%

Refer to page 114 of the 2010 Annual Report for this breakdown.Each shareholder is entitled to one vote for each ordinary share held. Our top 20 investors at 31 August 2010 held 88.57 percent of our issued capital. Our top 5 investors at that date were:Name IssuedCapital(%)

HSBC Custody Nominees (Australia) Limited 33.52

National Nominees Limited 27.51

JPMorgan Nominees Australia Limited 10.14

Citicorp Nominees Pty Limited 9.22

ANZ Nominees Limited 2.77

Our substantial shareholders (defined as having a relevant interest in 5 percent or more of Newcrest’s issued share capital) at 31 August 2010 were:Name IssuedCapital(%)

Blackrock 14.69

Fidelity 11.16

Commonwealth Bank of Australia 10.75

Local communitiesEach of our operations identifies a distinct local community (or local communities) within their area of influence. We recognise, respect and support the right of local communities to be consulted on matters which potentially impact on their culture and livelihoods.In most circumstances our local communities are ‘self‑selecting’, that is they are physically close to us, are potentially impacted by our operations, or have expressed an interest in our activities. It is our policy to ensure that there are multiple ways in which people in our local area can contact us.Newcrest maintains an active presence in each community that ensures that at all times people can access someone to ask a question or to lodge a complaint. A monitored process is in place to ensure that all complaints are attended to expeditiously or referred if local resolution is not practicable.Cadia ValleyCadia Valley is situated approximately 25 kilometres south of Orange in the Central Tablelands of New South Wales. Its community relations program is focused on the Local Government Areas of Orange, Blayney and Cabonne. This area includes the communities of Orange, Blayney, Spring Hill, Millthorpe, Carcoar and surrounding areas who are affected in some way by our activities.A community sub‑group of particular importance are the local landholders surrounding our operation. We have established specific mechanisms to ensure that there is a high level of both formal and informal contact with this group.GosowongGosowong is located on Halmahera Island in the North Maluku province of Indonesia. The immediate communities impacted by the mine are the Kao and Malifut sub districts however in acknowledgement that the impact of the operation is broader that mere proximity, the project recognises 5 surrounding sub districts as being within its sphere of impact; namely West Kao, North Kao, and Kao Bay (as well as the two previously mentioned). A total of some 80,000 people are resident within these sub districts and are all beneficiaries of the Corporate Social Responsibility program of Gosowong.The main indigenous group is the Kao community, which consists of a number of smaller ethnic groups including the Madole, Pagu, Boeng, Sosol and Kao peoples. Each of these ethnic groups has its own dialect, and slightly varying culture. The groups are spread throughout the Kao Subdistrict, and many people from different groups have intermarried. Most of the Kao community are Christians however a significant Moslem minority also exists.The second largest group after the Kao community is the Makian people. These people originated from nearby Makian Island, and moved to the Kao Subdistrict in 1988 when the Makian Mountain erupted. The Makian people mostly settled in the Malifut and Taolas areas of Kao, which have now become a separate subdistrict known as Malifut. The Makian people are predominantly Moslem.



TelferTelfer’s predominant area of interest is communities within a 300 kilometre radius of the mine, and also the towns of Marble Bar, Nullagine and Port Hedland.Telfer is situated on the edge of the Great Sandy Desert, which is home to Aboriginal language groups now collectively called the Martu. Aboriginal groups situated between Port Hedland and Telfer are also our key stakeholders, in particular those language groups whose areas are traversed by the gas pipeline.CracowCracow Gold Mine is located in a historical mining area centred on the community of Cracow in Central Queensland. Cracow has a very small population (around 30 people) and few amenities, with basic services being provided from the town of Theodore some 90 kilometres to the west. These two communities, and the local landholders around Cracow, make up the mine’s local community.In November 2002, an Indigenous Land Use Agreement (ILUA) was concluded with the Wulli Wulli People and the Iman People (the Iman People claim has been subsequently dismissed by the Federal Court of Australia). While most of these people do not live locally, the mine is actively working with these communities to provide employment opportunities and community development funding.Papua New GuineaThe land on which the Hidden Valley mine is being developed is held under customary title, which means that the Morobe Mining Joint Venture (MMJV) in which Newcrest holds a 50 percent interest, has had to negotiate a Compensation Agreement with the local land owners, and has committed to provide a range of community benefits in exchange for their approval to allow the mine to proceed.These are the Watut and the Biangai peoples who live in numerous small villages along the ridge lines and the river downstream of the mine.ExplorationWhile exploration activities usually have limited physical impact on local communities exploration does initiate the first wave of expectations. Our exploration people are aware that as the first representatives of Newcrest in an area they have an important role in setting the tone of our community interactions.Employees and contractorsOur people are fundamental to the achievement of Newcrest’s long‑term business strategy. During the year, Newcrest’s workforce increased due to the inclusion of MMJV personnel.The 2010 year has seen a stability of overall employee turnover (11 percent in June 2010 to 11 percent in June 2009), reflecting in part the uncertain economic conditions during the year generated by the global financial crisis.

Capital Market ParticipantsWe recognise a diverse group of capital market participants and their impact on our business. These include:

banks and other lending institutions;• mainstream equity analysts; and• socially responsible investment analysts.•

Increasingly, these stakeholders are requesting information on the sustainability performance of large organisations, such as ourselves, and building these criteria into their investment and lending decisions.OtherstakeholdersWhile not regarded as ‘key stakeholders’, the second group of stakeholders identified above (customers, suppliers, regulators and non‑governmental organisations) are very important to us.CustomersOur key customers are smelters in Japan, Korea Europe and China. We have long‑term smelter contracts to supply gold‑copper concentrate to:

Pan Pacific Copper (Japan), Cadia Valley and Telfer concentrate;• Mitsubishi Materials Corporation (Japan), Cadia • Valley concentrate;Sumitomo Metal Mining (Japan), Telfer concentrate;• LS‑Nikko (Korea), Telfer concentrate;• Jiangxi Copper Company (China), Telfer concentrate; and• Aurubis (Germany), Telfer concentrate.•

Newcrest also supplies concentrate to trade merchants, who, in turn, on‑sell it to smelters. In the year ending 30 June 2010, Newcrest sold concentrate to Trafigura Beheer BV (Switzerland), JP Morgan Metals & Concentrates (formerly RBS Sempra Metals & Concentrates) (USA), MRI Trading (Switzerland) and Louis Dreyfus Metals (Switzerland).On a dry metric tonnage basis, 48 percent of our gold‑copper concentrate was shipped to smelters in Japan, 37 percent to Korea, 14 percent to China and the balance to smelters in Germany and Belgium. Around 35 percent of our gold bullion (by value) was sold in Australia, and the rest in Asia, Europe and USA.

0

1000

2000

3000

4000

5000

6000

7000

8000

ContractorsEmployees

2010200920082007

Employee Statistics

1,828

2,387

2,3272,813

2,836

2,211

3,639

4,048



SuppliersWe have contracts with local, national and international organisations depending upon the location of our operations. A breakdown of our main suppliers is as follows:

BP Australia – fuel and lubricants;• Byrnecut Mining – mining services;• Dyno Nobel – explosives;• GE International – power;• Donhad – grinding Media;• Orica – reagents and Chemicals;• Sandvik Mining – mobile equipment and maintenance services;• Atlas Copco – mobile equipment and maintenance services;• Boart Longyear – drilling equipment and services;• Liebherr Australia – mobile equipment and • maintenance services;Downer EDI – mining services; and• Westrac Equipment – mobile equipment and • maintenance services.

RegulatorsOur regulators operate at the national, state/provincial and local levels. They include government agencies, and financial regulators. We seek to build lasting relationships with our regulators, without detriment to the role they play in regulating our industry. We seek to be responsive to their needs, and open and honest in our dealings with them.Non-governmental organisationsWe seek constructive relationships with key non‑governmental organisations (NGOs). In some instances this has resulted in direct practical assistance (e.g. providing tree seedlings for local Landcare groups). In other cases we have sought to find common ground on broader issues, and to maintain an ongoing relationship.OtherstakeholdergroupsWe are frequently in contact with national and regional bodies, both government and non‑government. Contact varies from representation on committees to broad discussion on matters of mutual interest.We also recognise that there are many sub‑groups within these broad categories. Where possible, we will attempt to interact with individual stakeholders in ways which are meaningful to them.

4.14 Stakeholder engagementThe Board and management recognise the importance of communicating openly and transparently with all stakeholders.ShareholdersThe Board recognises the importance of keeping the market fully informed of the Company’s activities and of communicating openly and clearly with all stakeholders. The Company has a formal Continuous Disclosure Policy in place to ensure that this occurs, a copy of which is available at www.newcrest.com.au/corporate.asp.Refer to previous section 4.3.

LocalcommunitiesThe Company continued to place a strong emphasis on its interaction with its local communities. These activities are maintained at the local level to maximise interaction between our operations and their communities. Details of our approach to stakeholder engagement in each of our local communities are listed below. Further information can be found in the community and indigenous rights sections of this report.OperationsCadia ValleyCadia Valley continues to be an active member of the local community and has conducted numerous community consultation and relationship building activities over the reporting period. Community consultation initiatives developed previously have been continued and supplemented by new initiatives.During 2006, Cadia Valley developed and implemented a Community Relations Strategy applicable to the three distinct Newcrest business units operating in the Cadia Valley (Operations, Projects and Exploration). The objective of the Strategy is to build long‑term beneficial relationships with key stakeholders as the foundation of a sustainable future.The four principles of the strategic approach are:

First and Honest;• Best and Fairest;• Give and Grow; and• Listen and Learn.•

Early community consultation was undertaken for the Cadia East Project and this is one of the largest mining project approvals to be assessed by the NSW government and was granted on 6 January 2010. The level of support for the Cadia East project is attributed to the comprehensive and sustained stakeholder consultation program. The development of the Cadia East Project was approved by the Newcrest Board in April 2010. First production from this $1.9 billion project is expected in the second half of 2012 which will enable production from the Cadia Valley for at least the next 30 years.GosowongSince the Gosowong operation commenced in 1998, the operator PT Nusa Halmahera Minerals (PTNHM), which is 82.5 percent owned by Newcrest and 17.5 percent owned by PT Aneka Tambang, has maintained an ongoing commitment to the local community. This was maintained under extremely difficult conditions following the conflict in the Malukus in 1999.Since 2007, PT. Nusa Halmahera Minerals has held responsibility for Community Assistance, under the umbrella of what is known as the Corporate Social Responsibility (CSR) program, in line with guidelines approved by the Indonesian Government.Under this program funds are allocated pro‑rata across five sub districts and 81 villages. Each village has a three person committee which identifies projects and allocates their funds. The CSR implementation unit of Gosowong facilitates the implementation of these projects and programs.



TelferThe original Martu Consultative Committee (MCC) established in 2003 to monitor agreements between Newcrest Mining Ltd and the Martu has done its job and has been replaced by regular meetings with the Martu‑prescribed Body Corporate ‘Western Desert Land Aboriginal Corporation’ or WDLAC.Newcrest meets with WDLAC frequently to discuss issues related to Cultural Programs, Community and Business Development, Education and Training, and Employment. Newcrest supports WDLAC with funding for two positions plus some for operational costs.Telfer has commenced discussions towards an Integrated Land Use Agreement (ILUA) with the Martu people. One meeting was held this financial year with the Martu ILUA Negotiating Committee to discuss negotiation protocols and guidelines.CracowWith a strong mining heritage and a small local community, the development of the Cracow project requires particular attention to the needs of all stakeholders. The mine’s location on the outskirts of Cracow township provides ample opportunity for casual contact with local residents. This informal interaction is supported by more formal consultation structures such as Residents meetings and Aboriginal Liaison Committee meetings.Three meetings of the Aboriginal Liaison Committee were held during 2010. One face to face meeting held in Cracow, one meeting held in Brisbane and one teleconference. Issues discussed at these meetings included:

employment opportunities – currently 12 permanent • indigenous employees;high school scholarships – 11 awarded for 2010;• traineeships – 3 offered each year;• commercial opportunities; and• cultural heritage matters.•

Project ExpansionSocial impact assessment and community consultation are now integral components of gaining approval to build and operate or materially or significantly upgrade a mine.It is our practice to put in place a dedicated and transparent community consultation program at an early stage of project development so that the local community can provide ongoing feedback as the project develops.

EmployeesandcontractorsWork performance systemOur business success, and therefore that of our stakeholders, requires that we always have the right people in the right roles doing the right work. This in turn requires that every Newcrest manager provides a productive work environment that encourages and rewards discretionary effort by all of our people.The Work Performance System has been designed to assist everybody in doing the right work in the right way. Integral to the functioning of the Work Performance System is the requirement for structured one‑on‑one sessions between managers and their subordinates. These sessions provide an ideal opportunity for feedback from employees.Internal publicationsNewcrest utilises its extensive email system and internal intranet to ensure that employees and contractors are informed of company news, issues and instructions. The intranet is the electronic repository for company policies, standards, guidelines and procedures and provides a company wide mechanism for feedback on a range of issues.Newcrest produces an internal newsletter called ‘Newcrest and You’. This publication is a vehicle for informal communication between Newcrest and its employees and principal contractors. Employees and contractors contribute short articles which are designed to entertain, inform and express views on happenings throughout the group. Local newsletters also include ‘The Cracow Nugget’, ‘Across the Valley’ (Cadia Valley), ‘Deep Dialogue’ (Ridgeway Deeps Project) ‘The Telfer Tattler’ and ‘Lintas Gosowong’ (which is produced in both Bahasa Indonesian and English).CapitalmarketparticipantsNewcrest has an ongoing relationship with a range of capital market participants, including lending institutions, analysts and fund managers.An increasing number of lending institutions include sustainability indicators in their lending decisions as part of their risk management and due diligence processes. A number of these institutions have adopted the Equator Principles (www.equator‑principles.com) and, as part of their obligations under this charter, seek to assess our performance on a range of environmental, social and economic impacts.Mainstream financial analysts, socially responsible investment analysts and fund managers are increasingly factoring sustainability performance into their company assessments. We have an ongoing relationship with these organisations through our statutory financial reporting, investor presentations and briefings, and site visits.



4.15 Stakeholder feedbackShareholdersEvery effort is made to ensure that communications with shareholders are clear and complete and that they address shareholders’ needs for information. The Company maintains a comprehensive website at www.newcrest.com.au. The Company encourages shareholders to express their views on the conduct of business by speaking at shareholder meetings or by writing to the Chairman of the Board of Directors. Feedback mechanisms are provided on the Company website.Shareholders generally provide feedback on those areas that impact directly on them. They are most concerned with financial matters such as dividend payments and frequency. They also provide feedback on board composition and operation during the AGM and sometimes seek information on particular operations or safety and environmental performance.LocalcommunitiesWe continue to seek both formal and informal avenues for community interaction. Each contact provides the opportunity for feedback, and the chance to strengthen our standing in the local community. Full details of our community initiatives are described in the social and indigenous relations sections of this report.Each Newcrest site maintains a complaints and incidents register that logs all complaints made, by whatever means, and tracks the response to any such complaint up to the point of close out.A process for the handling of grievances which cannot be resolved by dialogue and consultation is also built in to this system.EmployeesandcontractorsDespite the economic uncertainty generated by the global financial crisis the demand for skilled labour in the Australian resources sector remained steady throughout the year and is expected to continue for a number of years driven by major resource development projects. Attracting and retaining capable employees will continue to be a key challenge for the Company’s People Strategy. Developing Newcrest’s employees, promoting from within and providing challenging opportunities will continue to be hallmarks of the Company’s approach.CapitalmarketparticipantsWe value the feedback that we receive from lending institutions, financial and socially responsible investment analysts. This often enables us to benchmark against our peers, and provides a valuable independent assessment of our performance.SustainabilityreportfeedbackWe provided a number of ways in which readers of the Sustainability Report can provide feedback. They can do this directly via the internet, by email, or by down‑loading a feedback form and faxing it to us.A small number of comments were received on the 2009 report and they will be considered for incorporation into subsequent reports.


ECONOmIC PERfORmANCE INdICATORS

managEmEnt aPPrOaChThis Sustainability Report does not include all of the information normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of Newcrest as the full financial report.This Sustainability Report should be read in conjunction with the Annual Financial Report of Newcrest as at 30 June 2010. It is also recommended that this report be considered together with any public announcements made by Newcrest in accordance with the continuous disclosure obligation arising under the Corporations Act 2001. These public announcements can be found on our website (www.newcrest.com.au).Newcrest is now positioned as a world‑class gold producer. This has been achieved through many years of hard work and dedication on the part of our management team and workforce. A summary of our financial performance is outlined below, and a five year financial summary is attached for easy reference.

POLICY

Newcrest’s Concise Financial Report has been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards Board. The financial report has been prepared on a historical cost basis, except for derivative financial instruments which have been measured at fair value.The financial report also complies with international Financial reporting Standards (IFRS) including interpretations as issued by the International Accounting Standards Board.A full description of the accounting policies adopted by the Consolidated Entity may be found in the Consolidated Entity’s full Financial Report.

MANAGEMENT

OrganisationalresponsibilityAt the Board meeting to approve Newcrest’s annual and half‑yearly results in 2010, the Board received and considered statements in writing from the Managing Director and Chief Executive Officer and Director Finance in relation to Newcrest’s system of risk oversight and management and internal compliance with internal controls. These assurance statements were supported by an internal process of compliance confirmations by Executive General Managers and General Managers responsible for operations and key functions. The certificate of assurance stated that the financial statements have been prepared in conformity with generally accepted accounting principles and that they gave a true and fair view of the state of affairs of the Company. The certificate of assurance also stated that the risk management and internal compliance and control systems were operating effectively in all material respects in relation to the reporting of financial risks.The Audit and Risk Committee ensures compliance with all accounting and financial reporting obligations of the Group and reviews internal financial controls and the role of the internal and external auditors, including the independence of the external auditors, and the Company’s risk management activities.

GoalsandperformanceNewcrest’s vision is to be the ‘Miner of Choice’ – to maintain its position as a leading producer of gold, creating shareholder wealth in a manner which also benefits its employees and the communities and environments in which it operates. The Newcrest Board believes that adherence by the Company and its people to the highest standards of corporate governance are critical in order to achieve its vision.Newcrest pursues a strategy of delivering competitive returns by:

building a portfolio of low‑cost, long‑life gold assets, primarily • through exploration and a focus on early entry merger and acquisition prospects in known gold regions;optimising performance at each phase of the gold mining • chain; andharnessing its technical expertise across a wide range • of mining formats.

The 2010 financial year, the world economy has significantly recovered from the effects of the global financial crisis in the past fiscal year, however the broader macroeconomic outlook remains somewhat uncertain, particularly in Europe and USA. There have been three significant events during the year. Firstly the merger with Lihir Gold, secondly the approval of the Cadia East underground mine development (A$1.9 billion) and thirdly the excellent exploration results at Wafi‑Golpu confirming its future production potential.Newcrest group financial performance was strong with a 58 percent increase in underlying profit to a record of $763.7 million and an increase in statutory profit of 124 percent to $556.9 million. Gold production of 1,762,200 ounces was 8 percent higher than the prior year, while copper production of 86,816 tonnes was 3 percent lower. The price for both gold and copper increased in both US$ and A$ terms. Operating costs were stable across years, providing a decrease in unit costs, with the volume‑related increase in costs offset by significant input cost reductions driven mainly by the fall in diesel prices and the strengthening Australian dollar.On 4 May 2010, Newcrest and Lihir Gold Limited (Lihir) entered into a Merger Implementation Agreement (MIA) to combine the two companies under a Scheme of Arrangement (Scheme). The merger with Lihir is consistent with Newcrest’s focus on gold, expansion in South‑East Asia and acquiring or building low‑cost long‑life assets. The combination of Newcrest and Lihir creates the leading South‑East Asian gold company, the fourth largest gold company in the world by market capitalisation, and will deliver significant synergies and value for both sets of shareholders.Newcrest’s internal growth strategy also achieved key milestones with the operational commissioning of Ridgeway Deeps, Hidden Valley and the incremental commissioning of the Gosowong Extension Project during the year. Ridgeway Deeps was completed three months ahead of schedule and $40 million under budget of $545 million. Hidden Valley was delayed in reaching operational completion, was commissioned in May and was on budget. Management are working through a detailed improvement plan. The Gosowong Extension Project is on schedule and remains under the budgeted expenditure of US$179 million. The Cadia East development was approved by the Newcrest Board in April 2010 with an estimated capital cost of $1.9 billion, with first production expected late in calendar 2012.



Newcrest had a very strong 2010 financial year, increasing gold production and stable operating costs while taking advantage of increasing commodity prices to generate record profits and operating cash flow. Growth has continued to be a focus and with projects in development, completion and the acquisition of Lihir Gold Limited will deliver the vision to be the ‘Miner of Choice’.

CONTEXT

For the 2010 year the Company produced a full year profit after tax of $556.9 million. The financial overview of the Company’s performance is shown in the following table. 30June 30June 2010 2009

Gold Produced (ounces) 1,762,200 1,631,183

Copper Produced (tonnes) 86,816 89,877

Gold Price realised ($/ounce) 1,252 1,169

Sales revenue ($ million) 2,801.8 2,530.8

Operating EBIT ($ million) 1,127.4 772.6

Underlying Profit ($ million) 763.7 483.1

Statutory Profit ($ million) 556.9 248.1

Cash flow from Operations ($ million) 1,303.3 1,024.1

Capital Expenditure (cash flow basis including Exploration ($ million) 886.5 1,381.6

EPS on underlying profit (cents) 158.0 103.2

Return on capital employed (ROCE) (percent) 24 17

Gearing (Net debt/net debt plus equity) (5) 2

(All$areAustraliandenominatedunlessstatedotherwise)

ECOnOmiC PErfOrmanCE

EC1 Economic value generated and distributedRevenueSales revenue for the year 2010 was $2,801.8 million. Sales revenue for the last 5 years is shown in the graph below.

0

400

800

1,200

1,600

2,000

2,400

2,800

Sales Revenue($M)

0706 08 09 10

Gold sales revenueThe higher gold price and increased gold sales volumes has resulted in a significant increase in gold revenue. Substantially higher copper prices have also resulted in a material increase in copper revenue, notwithstanding the lower copper sales volumes. Gold revenue represents 75.9 percent of Newcrest’s overall sales revenue (2009:75.6 percent).Total gold production increased by 8 percent to 1.762 million ounces, while sales volumes increased 6.6 percent to 1.745 million ounces. The overall production increase of 131,017 ounces was in line with guidance and mine plan expectations. Movements by operation were:

a 9.5 percent increase of 59,801 ounces at Telfer due to • significant increase in mill throughput reflecting increased mill throughput reflecting increased mill utilization due to improved plant maintenance scheduling;a 9.3 percent increase of 27,823 ounces from Cadia Hill due to • increased gold recoveries. Gold grade increased in the second half of the year with mining focused on higher‑grade zones which will continue with the completion of Cutback 3;a 26.6 percent decrease of 62,324 ounces at Ridgeway due to • reduced throughput and grade as mining from the sub‑level cave was completed and production transitioned to the Ridgeway Deeps block cave mine. The block cave mine production ramp‑up continued with ore production rates increasing through the later part of the year as additional draw points were completed;a 10.6 percent increase of 42,305 ounces at Gosowong due • to substantially higher mill throughput and increased gold recoveries, offsetting the lower grade;a 3.6 percent increase of 2,488 ounces from Cracow due • to increased throughput, partly offset by lower grades; andproduction of 60,924 ounces at Hidden Valley (Newcrest • 50 percent share). The operation was fully commissioned in May 2010.

Total gold revenue increased by 11 percent to $2,125.5 million (2009: $1,914.4 million) as a result of higher prices and sales volumes. The average gold price of A$1,252 per ounce was 7.1 percent higher than the prior year (A$1,169 per ounce).Copper and silver sales revenueGroup copper revenue increased by 9.8 percent to $651.6 million due to substantially higher prices partly offset by lower sales volumes. The average copper price of A$3.40 per pound was 17.6 percent higher than the A$2.89 per pound in the prior period. The lower sales and production was mostly from Ridgeway as mining transitioned from the sub‑level cave to the Ridgeway Deeps block cave mine.Silver revenue increased by $1.5 million due to higher sales prices partly offset by lower sales volumes. The lower sales volumes were mainly due to lower silver production at Gosowong, due to lower mined silver grade.



Other revenue and other income/(Expense)Other revenue and Other income was $28.9 million (2009: $15.1 million). A foreign exchange loss of $14.7 million is due to the effect of the strengthening A$:US$ exchange rate on US$ denominated concentrate debtors.The fair value gain on gold and copper derivatives related to the movement in spot prices impacting the quotational period adjustments in sales. Newcrest locks in the copper price for certain concentrate shipments at the time of sale to minimise this impact. Gold prices are not locked in at the time of shipment due to the shorter quotational period for gold (usually one month for gold versus three to four months for copper).Other Revenue mainly comprises of interest revenue which was higher due to the improved cash generation during the year.Geographic breakdown of marketsNewcrest sells gold bullion in the Australian and Other Asia markets, and copper‑in‑concentrate in the Japan, China, Korean, European and USA markets (see table below). The majority of concentrate sales to customers in Europe and the USA are shipped to smelters in Japan, Korea and China. SalesRevenuefrom ExternalCustomers ($ million)

Country 2010 2009

BullionAustralia 981.3 858.2Other Asia 2.2 1.8

ConcentrateJapan 769.6 989.7Korea 130.3 134.6China 154.9 103.8Europe 670.6 364.2USA 92.9 78.5

Totalsalesrevenue 2,801.8 2,530.8

MineproductioncostsMine production costs decreased by 0.1 percent to $1,096.7 million, despite an increase in Group mining activity and production, and the inclusion of Hidden Valley’s costs from 1 May 2010. The primary driver of the cost reduction was the strengthening A$ on major US$ cost inputs, mainly fuel and lubricants, maintenance parts and mining and milling consumables. Diesel input prices fell from A$0.98 cents per litre last year to A$0.78 cents per litre in the current year. In addition, the sustained benefits of cost reduction initiatives are evident across the Group, in particular at Telfer with savings in contract labour and plant maintenance, and site administration and engineering overheads.The fall in the input costs have been countered by higher costs associated with the significant increase in mining and milling activity across the Group, with a subsequent increase in metal production.

However, Newcrest’s unit cash costs continue to be in the lowest cost quartile for global gold producers. Newcrest’s cash costs for the year fell to US$306 per ounce (FY09: US$350 per ounce) compared to the global average of US$516 per ounce (FY09: US$489 per ounce). Details of the various influences on Newcrest’s costs are provided in the Annual Report 2010.DepreciationDepreciation expense, included in cost of sales, increased by $38.4 million to $300.9 million. The unit rate of depreciation increased by 8.6 percent to $174.8 per ounce reflecting production generated from new developed mines at Ridgeway Deeps, Gosowong and Hidden Valley.Finance CostsAs a result of strong operating cash flows, Newcrest reduced its debt levels resulting in lower gross borrowing costs of $33.2 million (2009: $39.5 million). Interest of $33.2 million was expensed for the year (2009: $34.9 million) with no capitalization. Interest of $4.6 million capitalised in the prior year relates to the Hidden Valley development project.Corporate administration costsCorporate expenses of $77.2 million was an increase of $7.4 million from the prior year. The corporate expenses include corporate costs of $61.2 million (2009: $57.5 million), depreciation of $7.6 million (2009: $4.3 million) and the accounting impact of the share based remuneration of $8.4 million (2009: $8.0 million).Exploration expenditureTotal exploration expenditure for the year was $101.1 million (2009: $109.3 million) with $33.0 million charged against income compared to $57.8 million in the prior year.WagesandbenefitsThe total payroll and benefits for the past year amounted to $451.7 million. The breakdown of this figure is shown in the table below. 2010 2009 $million $million

EmployeeSalaries 183.6 179.0

BenefitsDefined benefit plans expense/(benefit)(1) – 0.8Equity settled share‑based compensation payments 8.4 8.0Termination benefits expense – 1.6Defined contribution plan expense 20.4 18.3Other employment benefits 239.3 219.7

TotalBenefits 451.7 427.4(1) In 2009, the remaining employees of the defined benefit plan

retired or left the Group and the plan was subsequently closed.



ProvidersofcapitalDistributions to providers of capitalThe following table shows the distribution to providers of capital broken down by total finance costs – ordinary activities, and dividends on all classes of shares. 2010 2009 $million $million

Total finance costs – ordinary activities (33.2) (34.9)Dividends on ordinary shares (72.5) 72.5

Total (105.7) 107.4

CommunityinvestmentsNewcrest’s contributions to local communities are detailed in Section CS7.Direct contributionsDirect contributions made to community, civil society, and other groups in 2010 amounted to $12,055,000.In Indonesia, these contributions assisted community development programs in the health, education, training and small business sectors.In Papua New Guinea, these contributions have contributed to travel assistance, fuel support, sports clubs and church groups.In Australia, most of the funds were directed to those organisations that support local communities and included local schools and hospitals, rural fire services, Royal Flying Doctor Service, Salvation Army, Smith Family, Red Cross and similar aid agencies.In addition to financial contributions, ‘in kind’ support was provided by the operations and individual employees for many community initiatives during the year.Entity Contributions($’000)

PT Nusa Halmahera Minerals 4,549

Cadia Valley 705

Telfer 2,360

Exploration 211

Cracow 71

Hidden Valley 4,159

Total 12,055

Infrastructure investmentsSee Section EC8.

EC2 financial implications of climate changeGovernanceThe Safety, Health and Environment Committee of the Board is tasked with assessing the adequacy of the Company’s response on issues of concern. Climate change has been one such issue over the last few years, and is now discussed at Committee meetings. The Safety, Health and Environment Committee of the Board is regularly updated on developments in the climate change debate and monitors management response to developing issues.

Risks and opportunitiesNewcrest has no significant physical assets which are at risk of rising sea levels. All of our mines are significant distances from the coast and/or at significant elevations above sea level.Whether current climatic and weather patterns are related to climate change is unclear. However, Australia is experiencing a protracted period of lower than normal rainfall. Water is a vital commodity in the processing of our ores, and we have taken steps to improve our recycling efficiency and security of supply.Financial implicationsIn our business models we have included an estimate of future carbon prices using Australian Treasury modelling as a basis and estimated the carbon emission profiles for our operations based on future production profiles.The Carbon Pollution Reduction Scheme (CPRS) is an emission trading scheme which will use a cap and trade mechanism. The cap is an upper limit on the country’s carbon pollution that will be reduced in future years – achieves the environmental outcome. The ability to trade ensures that pollution reduction opportunities throughout the economy are harnessed which reduces the economic cost of meeting ambitious carbon pollution reduction targets. The CPRS introduces a price on carbon pollution and ensures that all businesses take this into account when making business decisions.On 27 April 2010, the then Prime Minister, Kevin Rudd, announced that the Government has decided to delay the implementation of the CPRS until after the end of the current commitment period of the Kyoto Protocol and only when there is greater clarity on the action of other major economies including the US, China and India.

EC3 Superannuation schemesThe Consolidated Entity contributes to the Newcrest Superannuation Plan and other complying superannuation funds, which provides benefits to a defined benefit plan and a defined contribution plan.Defined benefit planThe defined benefit plan provides lump sum benefits based on years of service and final average salary. The defined benefit plan is closed to new members. In 2009, the remaining employees of the defined benefit plan retired or left the Group and the plan was subsequently closed.Defined contribution planThe defined contribution plan receives contributions from employees at various percentages of their wages and salaries. The Consolidated Entity contribution is limited to the legally enforceable contribution of 9 percent.

EC4 government financial assistanceWe are unaware of any subsidy paid to us during 2010.

mm1 revenue capture, management and distributionWe have chosen not to report on this parameter this year, but will consider its inclusion in future reports.

mm2 Value addedWe have chosen not to report on this parameter this year, but will consider its inclusion in future reports.



markEt PrESEnCE

EC5 Wage levelsWe have chosen not to report on this parameter this year, but will consider its inclusion in future reports.

EC6 locally‑based suppliersConsumable purchases from the following suppliers exceeded 10 percent of total purchases during the year (country shown in brackets):

BP Australia (Australia) – fuel.• A further four organisations fell between 5 percent and 10 percent of total purchases:

Donhad (Australia) – grinding media;• Dyno Nobel (Australia) – explosives;• Westrac (Australia) – mobile equipment and maintenance • services; andByrnecut Mining – mining services.•

In no country did the total purchase of goods, materials and services exceed 5 percent of that country’s Gross Domestic Product (GDP).

EC7 Origin of managers and local workforceWe have chosen not to report on this parameter this year, but will consider its inclusion in future reports.

inDirECt ECOnOmiC imPaCt

EC8 infrastructure investments and servicesCadiaValleyCadia Valley contributed $705,000 to various local community groups (Landcare), schools and local charities, the details of which are discussed in section CS7. In addition, CVO contributed directly to local infrastructure primarily for the maintenance of local roads which are used by suppliers and employees accessing the operations.Case Study: Errowanbang Rent-A-Farmhouse SchemeWhen Newcrest purchases agricultural properties for its Cadia Valley Operations and if a house is present on these properties, preference is given to young families who would support the local Errowanbang Public School and other community infrastructure. The initial tenancy strategy required to be modified in view of the tendency for mining employees to be relatively mobile and the houses were rotated too quickly for any real value to be added to the local community. A change in strategy in 2009, CVO met with the P&C of the Errowanbang School with a view of developing a more effective strategy. The result was the Errowanbang Rent‑A‑Farmhouse Scheme. Through the scheme, the local community selects the tenants that they felt would add the most value to their community. CVO offered to discount the rent of each house to help the community to attract a wide selection of perspective tenants.A community committee was formed and a website developed to advertise all available CVO house at an average rental price of $100 per week. CVO maintains responsibility for repair and maintenance of the houses and provides funding towards improvements if matched by in‑kind contributions from the tenant. The objective of the scheme was to attract families to the district and to supplement enrolments at the local school with a target of increasing student numbers from 13 to 26.

Twelve months into the program the Rent‑A‑Farmhouse Scheme has exceeded all original objectives. The Errowanbang School enrolments have increased to 28 students, securing a second teacher for the school, funding for construction of a second schoolroom and sufficient numbers to establish a bus service to the school for the first time in its history.GosowongThe community around the Gosowong mine is much more diverse and physically dispersed than the communities around other Newcrest’s other operations. The impacted communities cover 5 administrative sub districts, some 81 villages and a total population in the order of 80,000 people.CracowCracow has been working to improve the communities infrastructure, by purchasing, relocating and restoring buildings with heritage value. This includes the original courthouse, operating theatre and doctors surgery. The refurbishment of these properties will play an important part of the heritage journey from the traditional land owners through to modern day. The original courthouse will house the mine museum, a modern and interactive physical display, shop/cafe and linking the physical infrastructure to the ground works. This project will provide long‑term benefits to the Cracow community by increasing the residential interaction, enhancing community relations and strengthening economic growth.TelferThe main focus of activity for the Telfer Community Relations team is the ongoing process of managing and monitoring the Jigalong dialysis unit with the aim of securing a licence for the facility, with the long‑term vision of transferring this licence to the Aboriginal Health Service.Newcrest is also a very strong supporter of a healthy lifestyles project, a not‑for‑profit venture that aims to deliver healthy food into the remote communities at an affordable price.Sporting activities at Telfer are significant factors in community health and social cohesion in the Western Desert. Newcrest is a major sponsor and supporter of the Punmu Sports Festival and the Nullagine Sports Carnival each year.HiddenValleyThe joint venture has committed to a 5 year Sustainable Community Development Plan, which has its principal focus on the expansion of agriculture within the mining communities, as well as community health, education and infrastructure.The programs are being rolled out via partnerships with NGOs and government agencies. A priority program of development in the main land owners’ villages has been initiated this financial year, with each village group provided with an aid post, community centre and water supply to ensure a base of social infrastructure is in place.

EC9 indirect economic impactsWe have chosen not to report on this parameter this year, but will consider its inclusion in future reports.


Environmental Performance Indicators

managEmEnt aPPrOaCh

POLICY

Newcrest has an Environmental Policy, which can be found on our website.

MANAGEMENT

ManagementsystemsWe have developed our environmental management systems in accordance with ISO 14001, and are progressively implementing these across operations. At this time, Newcrest has not taken the final step of independently certifying any of its environmental management systems.OrganisationalresponsibilityThe Company’s senior environmental professional is the Head of Environment, who is responsible for the Group’s overall environmental performance, setting appropriate environmental standards and objectives, and for advising senior management and the Board on environmental matters. In addition, each operating site has one or more environmental professionals to manage site environmental issues and to advise site management on environmental matters.All of Newcrest’s employees and contractors have an obligation to comply with environmental laws and regulations and to comply with the Company’s environmental policy, standards and specific statutory obligations (environmental licenses, consent conditions, etc.).Newcrest has a Board Committee, the Safety, Health and Environment Committee, which monitors the Company’s environmental management practices and ensures that the Company has appropriate policies in place. The Committee met four times in 2010.GoalsandperformanceNewcrest has identified a number of Group environmental objectives to assist in achieving our desired environmental performance. These objectives are integrated into the Group’s business planning cycle. The Group environmental objectives are:Culture:• to develop a sustainability culture which reflects the environmental aspirations of the Group.Accountability:• to ensure clear accountability for the implementation of our environmental strategy.Management:• to promote the systematic undertaking of environmental functions and the achievement of performance objectives.Projects:• to undertake key projects at the corporate level which coordinate Group response to individual issues.Externalrelationships:• to maintain an appropriate sustainability profile with key stakeholdersCompliance:• to comply with all applicable environmental laws and regulations and to perform at the desired standard.TrainingandawarenessEnvironmental training and awareness is an important component of our ongoing commitment to improved environmental performance.Each of our operations has an induction program for new employees and visitors, which includes an environmental component. The program highlights Newcrest’s environmental policy, our commitment to environmental care and any site

specific environmental aspects. Work area specific inductions highlight any environmental obligations which are part of a particular role or work area. It is the responsibility of all employees, contractors and visitors to act in an environmentally responsible way. Environmental awareness training is conducted throughout the year and will often focus on a particular theme or broad site objective.Professional development is an ongoing requirement for environmental professionals across the Group. This involves attendance at conferences, workshops and professional training programs to upgrade existing skills and acquire new ones.To further facilitate personal and professional development, Newcrest has established ‘Communities of Practice’. Environmental personnel across the Company are members of the Safety, Environment and Risk Community of Practice and a number of workshops have been held. The key objectives of establishing Communities of Practice within Newcrest are summarised as follows:

Foster excellence across Newcrest in all key fields;• Develop careers by providing an effective means of mentoring • employees at junior and mid‑levels of the organisation;Foster exchange of technical information across • Newcrest operations;Encourage inter‑ and intra‑discipline communication • and cooperation;Where appropriate, foster standardisation and consistency • of systems and methodology; andThrough their effective operation, add value to the • business through technical excellence and development of professional skills.

CONTEXT

In 2010 Newcrest successfully delivered major capital projects at Gosowong and Cadia. The Ridgeway Deeps project was successfully completed ahead of schedule and under budget, as was the Gosowong Expansion project at the commissioning phase. The Hidden Valley project was commissioned and the Wafi‑Golpu (PNG) and O’Callaghans (WA) studies are underway. In April 2010, the Newcrest Board approved the development of the world‑class Cadia East deposit following the completion of all regulatory requirements. First production for this A$1.9 billion project is expected in the second half of 2012, which will enable production from the Cadia Valley for at least the next 30 years.Once in production, the emphasis changes to developing and implementing responsive management plans that seek to promote positive impacts and mitigate adverse impacts. Monitoring programs support operational performance as we measure ourselves against regulatory requirements and the commitments we have made to our surrounding communities. Planning adopts a longer‑term focus, which provides opportunity for community involvement and development. In the production phase, there is also an increased focus on developing systems that will sustain the mine through its operating life.Effective environmental management systems are essential to support the levels of environmental performance we expect from our operations. To this end, an EMS audit was undertaken in July – October 2008 at our operations and minerals group. Corrective action plans to addresses areas identified for improvement have been developed and progress tracked over the year. Operating approvals and licences are becoming


ENvIRONmENTAL PERfORmANCE INdICATORS

increasingly complicated and time consuming to manage, and to ensure that the organisation continues to operate in accordance with these approvals, an approvals tracking system has been developed.Additional development opportunities have been identified in each of our operational areas (e.g. Gosowong) and new projects (e.g. Namosi in Fiji and Wafi‑Golpu in PNG). Environmental and social impact assessment studies have been integrated into the project development timetable to ensure early identification of potential impacts and the development of appropriate mitigation strategies.

matErialS

En1 materials useAccording to the report Triple Bottom Line Reporting in Australia: A Guide to Reporting Against Environmental Indicators (Environment Australia, 2003), total material use is – ‘the weight of all materials purchased or obtained from other sources, including raw materials for conversion to product or service, associated process materials, and semi‑manufactured goods or parts. It excludes water and materials used to generate energy’.The report divides materials into two classes:

materials from owned sources: raw material sourced from • within property owned by the organisation (our ore); andmaterial from suppliers: which is sourced from outside • property owned by the organisation (our reagents and other consumables).MaterialfromownedsourcesOreThe total amount of ore processed in 2010 was 48.2 Mt (the majority of which passed through the Cadia Valley process plant (22.6 Mt) and the Telfer process plant (21.9 Mt). This is a 13 percent increase on the previous year, this increase reflects commissioning at Hidden Valley (see figure below).

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MaterialfromsuppliersReagents and ConsumablesReagents are key consumables used in the processing of our ore. A total of 55,653 tonnes of reagents and consumables were used in 2010. As a minimum, reagents are transported, stored, used, and residues disposed of, according to the regulations in the jurisdiction in which we operate.The principal reagents were:

quicklime and lime (35,201 tonnes): added to the process • circuit to modify slurry pH; andcyanide (6,178 tonnes): used at Gosowong, Cracow, Telfer • and Hidden Valley. Cyanide use has increased from the previous year (3,782 tonnes).

Cyanide is a toxic and hazardous substance; however, proper management ensures the protection of both human health and the environment. At Gosowong, Hidden Valley and Cracow, cyanide is detoxified before discharge to the tailings dam. At Telfer, discharge is managed to less than 50 mg/L CNWAD prior to discharge to the tailings dam. During the reporting period the 50 mg/l limit for WAD and Total cyanide was not exceeded.Cyanide CodeThe ‘International Cyanide Management Code for the Manufacture, Transport, and Use of Cyanide in the Production of Gold’ (the Code or ICMC) was developed by a multi‑stakeholder Steering Committee under the guidance of the United Nations Environmental Program (UNEP) and the then International Council on Metals and the Environment.The Code is a voluntary industry program for gold mining companies, and companies involved with the production and transport of cyanide to gold mining companies. Companies that adopt the Code as signatories must have their operations, which manufacture cyanide, transport cyanide or use cyanide to recover gold, audited by an independent third party to determine the status of compliance with the Code.The objective of the Code is to improve the management of cyanide used in gold mining and assist in the protection of human health and the reduction of environmental impacts. The Code is managed by the International Cyanide Management Institute (ICMI).This year, a gap analysis was conducted by an independent third party consultant to determine the status of compliance with the Code at two of our mining operations at Telfer and Cracow. Action plans are currently underway to support the recommendations to meet the requirements of the Code.At Hidden Valley, preparation work is underway for certification in the later part of the next financial year. The processing plant was designed to comply with the Cyanide Code and a gap analysis has been commissioned to identify any key actions necessary to meet the Code’s requirements.Since commissioning of the processing plant in this financial year, measured cyanide concentrations remained in compliance with the Environmental Permit limits at the Nauti Village compliance point.More details on the Code can be found on the ICMI website: www.cyanidecode.org.



Other consumablesThere are consumables other than reagents used in the mining and processing of our ore.The principle consumable in mining is explosives used to fracture waste rock and ore. Our explosives come in two main forms, ANFO (ammonium nitrate fuel oil – 11,713 tonnes) and emulsion (15,180 tonnes). Packaged explosives are used in minor amounts and are not included in explosive use figure.The principal consumables in our process are grinding balls (48,743 tonnes), which are added to the grinding circuit to assist the mechanical breakdown of the ore.HydrocarbonsWe use significant quantities of diesel and lubricants in our mobile fleet and fixed plant. More detail on our diesel usage is given in the section on energy.

En2 materials used which are recycledWe did not use materials which were recycled (processed or unprocessed) from external sources in 2010, other than at Cadia Valley, which did use significant volumes of ‘grey water’ (primary treated effluent) from Orange, Blayney and Millthorpe (see Water).

mm4 Products derived from secondary materialsWe do not produce any significant quantity of product derived from secondary materials. Our primary resource is gold and/or gold‑copper ore which we mine directly, or is mined for us by our principle contractors. This material is crushed and processed with the addition of reagents to produce gold doré or gold‑copper concentrate (refer Cadia Valley low grade flowsheet).

mm5 StewardshipStewardship is the management of materials, resources and products throughout their life cycle to maximise value and better manage the environmental and social impacts arising from their production and use. The adoption of stewardship practices by industry is now driven by a range of factors, including the uptake of sustainability reporting, the cost of waste disposal, the need to fully leverage value from products and materials, the need to foster innovation, as well as the need to keep pace with community expectations.MaterialsstewardshipMaterials stewardship is the preferred nomenclature for the Australian minerals industry, as it best describes the shared responsibility ethos of the industry, the ‘upstream’ position of the minerals industry in the value‑chain, and the broad range of principles, policies and tools that are being applied within the industry.Materials stewardship can be divided into three sub‑categories, resource stewardship, process stewardship and product stewardship.Resource stewardshipResource stewardship is a program of action focused on ensuring that resource inputs to the production process, such as minerals, water, reagents, energy and fuel are accessed, used and disposed of in a socially and environmentally responsible manner.Process stewardshipProcess stewardship is a program of action focused on ensuring that processes, such as crushing, grinding, floatation, etc. used to produce goods are undertaken in a socially and environmentally responsible manner.

Product stewardshipProduct stewardship is a beyond‑the‑gate approach to the protection of human health and the environment which focuses on the outputs of the production cycle.Input/outputmodelorTheGoldLifeCycleThe key inputs and outputs of materials provide an overview of the stewardship elements of an operation or process. As an example, a material flow diagram for the Cadia Valley operation is attached. Our stewardship approach to these key materials is discussed in various parts of this sustainability report (see links below). We have two principle products; gold doré and copper concentrate, neither of which are sold direct to the public.

EnErgy

En3 Direct energy consumptionDirect energy consumption is the consumption of primary energy sources whether non‑renewable (coal, natural gas, oil or nuclear energy) or renewable (biomass, solar, wind, geothermal or hydro‑energy). Direct energy can be further broken down into primary energy, which is used in its basic form (for us this is principally natural gas), and intermediate energy which is modified before being consumed on our sites (e.g. coal to electrical power).NaturalgasPower is generated at Telfer using three gas turbines with a total installed capacity of 145 Megawatt (MW). The turbines operate on natural gas that is transported from the Western Australian coastal town of Port Hedland to Telfer via a 450 kilometre purpose built pipeline, owned and operated by Australian Pipelines Group. The pre‑existing diesel power station (total capacity 12 MW) provides back‑up power and additional capacity during periods of peak load.A total of 8,000 terajoules (TJ) of natural gas were consumed in the generation of electricity at Telfer in 2010. The amount of natural gas used in gigajoules (GJ) per tonne of ore processed at Telfer in 2010 is shown in the graph below.

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DieselThe other main source of direct energy consumed on site was diesel. Of a total of 189,894 kilolitres of diesel used during 2010, 34 percent was used for on‑site power generation and 66 percent for transport purposes (principally hauling ore and waste rock).The diesel use per tonne treated for the years 2006 through 2010 is shown in the graph below. There was an increase in the current year from 3.16 L/t to 3.94 L/t, reflecting the inclusion of the Hidden Valley project.

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OtherfuelsSmaller amounts of other fuels were also used during the year, including:

petrol (48 kilolitres);• avgas (4,681 kilolitres); and• jet fuel (1,751 kilolitres)).•

En4 indirect energy consumptionIndirect energy is purchased energy generated offsite which is imported to site in the form of electricity, fuel or steam.Power drawn directly from public electricity grids at CVO, Cracow and MMJV is included in this category. The major consumer of electricity on each of the sites is the processing plant. Indirect energy consumption by Exploration is also included as drilling during this reporting period was conducted in close vicinity of homesteads and drew electricity from the grid.The electricity use per tonne treated for the years 2006 through 2010 is shown in the graph below. There was an increase of 10.5 percent in the current year. This reflects the inclusion of the electricity consumed on the MMJV project.Neither Gosowong nor Telfer consume indirect energy – their power is self‑generated (see above re Direct Energy).

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En5 Energy conservation and efficiency improvementsThe following energy conservation and efficiency improvements have been implemented or are planned to be implemented:

Combined Cycle Gas Turbine – Further investigation has taken • place to more accurately determine the potential simple payback period associated with the conversion of the existing simple cycle turbo‑generator, which supplies the majority of Telfer’s electricity, to a combined cycle unit. The findings of this detailed investigation confirm that forecasted savings would be lower than the projected savings due to the nature of the natural gas contract and the requirement of additional staff to operate the Telfer Power Station. The Company continues to investigate alternatives to cost‑effectively increase the conversion efficiency of the power station. Options being investigated include steam injection, pre‑chilling of turbine inlet air and the implementation of small modular binary plant.Upstream Lift of Tailings Dam – At Cadia Valley a detailed • feasibility study was completed on the project to reduce energy consumption by modifying tailings dam wall management. This project is currently being implemented, with construction of the first embankment lift using the new method in progress. Energy savings will be quantified once a suitable amount of data has been collected.Compressed Air Audit – The compressed air audit at Telfer has • been evaluated and quotations sourced. This project is planned for implementation prior to the end of the 2011 financial year.A new hydro power transmission line, for Hidden Valley is • currently under construction. This will reduce the reliance on diesel generated power on‑site. The main goal for the operations is to switch the mine’s generation of electricity from diesel to hydroelectric sources through the PNG electricity grid. Progress in achieving this major change in fuel consumption is subject to PNG Power’s timetable for the construction of a new generation capacity and transmission infrastructure.

The Energy Efficiency Opportunities (EEO) public report is available on the Newcrest website.

En6 Energy‑efficient products and servicesWe do not produce energy‑efficient or renewable energy‑based products and services.

En7 reduced indirect energy consumptionNo specific indirect energy conservation and efficiency improvements have been implemented across the Group in the reporting year.



WatEr

En8 total water withdrawalNewcrest has been an active participant in the Minerals Council of Australia’s Water Working Group. One of the key projects of this group has been the development of a water accounting framework for the minerals industry.The current version of the framework provides:

A consistent approach for quantifying flows into, and out of, • reporting entities, based on their sources and destinations;A consistent approach for reporting of ‘water use’ by minerals • operations that enables comparison with other users, and relates to water sharing planning processes;A consistent approach in quantifying and reporting water ‘reuse’ • and ‘recycling’ efficiencies such that the reliance on sourced water is reduced; andA model for the more detailed operational water balance • as guidance for those businesses which currently do not have an effective operational water model or see an opportunity to develop this new approach.

More detail on this framework is provided at www.wateraccounting.net.au/wiki/Main_Page.CVO was a participant in the Central West NSW Pilot Project.The make‑up water per tonne of ore treated for the years 2006 through 2010 is shown in the figure below. Make‑up water use in the current year decreased by 10 percent over the previous year. This was largely due to a decrease in the total volume of water used at Cadia and Gosowong. The water that is pumped into the Cadia Valley water storages is classified as make up water as it is abstracted from the environment however it is not all used in the process (see water balance diagram below).

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CadiaValleyCadia Valley obtains its water from four main sources:

grey water from Orange, Blayney and Millthorpe;• dewatering and recycling of water from Ridgeway underground • mine dewatering from the Cadia Hill pit;surface water from Cadiangullong Creek dam; and• pumping from allocated water licences on the Belubula River • and a weir on Flyers Creek.

CVO water sources are outlined in the Table below.Table:CVOWaterSourcesSource ML %

Effluent – Orange 2981 46

Groundwater – Mine dewatering 842 13

Surface water – Cadiangullong 760 12

Surface water – Cadia Hill Pit 576 9

3rd Party Supply – Belubula 365 6

Surface water – Belubula High Security 305 5

Surface Water – Flyers Creek 257 4

Effluent – Blayney 210 3

3rd Party supply – CTW 162 2

Groundwater – Bores 88 1

Surface Water – Belubula General security 0 0

Total 6,546 100

The Cadia Valley water balance for 2010 is depicted below.

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Although drought conditions slightly eased over the reporting period, with almost average rainfall recorded, the timing and intensity of rainfall resulted in limited runoff leaving all regional dams, including CVO’s Cadiangullong Dam, at low levels. As such, CVO continued to focus on maximising recycling, recovery and optimisation opportunities. Since July 2010, the region has received significant widespread rainfall which has seen Cadiangullong Dam fill to overflowing by the middle of August. This rainfall also resulted in high flows in local streams, which allowed pumping from the Belubula River and Flyers Creek into Rodds Creek Dam, which was at maximum capacity by mid September. The overall water balance for 2010 shows a decrease in water storage of 2,108 ML. The above graph indicates the sources, uses and losses over the reporting year.



CVO has a licensed entitlement on the Belubula River of 7,205 ML/yr (made up of 4,080 ML/yr General Security and 3,125 ML/yr High Security). This entitlement is subject to allocations announcements (general security) and flow conditions (high security). Water was only extracted from the High Security component of the licence, with 305 ML extracted during the year. An additional 365 ML was transferred from downstream licence holders.Water management remains a significant issue for CVO. During the reporting period, the Water Management Plan was updated and submitted to DoP for approval. The water use intensity at CVO is shown in the figure below.Cadia Valley Water Use Intensity(L/t)

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The Water Management Plan identified potential projects to improve water management at CVO. Some of the projects completed during the reporting period include:

Maximising Tailings Density – work has continued to identify • areas for improving the density of tailings sent from the tailings thickener to the Tailings Storage facility;Ridgeway recycling program – Recycled water as part of the • Ridgeway mine dewatering is reused for dust suppression. This allowed for expanded work in the commissioning of the Ridgeway Deeps mine, without requiring any additional water;Increasing the performance of the Belubula River Pump Station • – performance of the system had degraded from 20 ML/day when commissioned to 16 ML/day. Work has been undertaken to increase the performance to 18 ML/day; andOptimising pit dewatering to ensure the most effective use • of water.

The Cadia East Project requires augmentation of the water management system to allow for an increase in production from 24 to 27 Mtpa. As part of the Cadia East Development, CVO proposes to:

Install a pipeline from Cadiangullong Dam to Upper Rodds • Creek Dam to allow the transfer of water from one dam to the other;Increased storage capacity of Upper Rodds Creek from 3,700 • to 14,500 ML;Increasing the maximum extraction rate from the Belubula • River from 20 to 30 ML/day; andOptimising the water use from pit dewatering to ensure the • most effective use.

GosowongGosowong pumps water from a permanently flowing river (the Tobobo River) which flows adjacent to the minesite with extraction rates estimated to be 8 percent of base flow. Physical, chemical and biological monitoring shows no effects from this abstraction.TelferTelfer abstracts groundwater for its operations under a Licence to Take Water issued by the Department of Water (DoW). GWL 150758(9) allows a total abstraction of 29,700,000 kL/year (yr) from both the Telfer Near Mine Borefields and Telfer Access Road Borefield. Groundwater extracted from the near mine borefields is used for a range of purposes including raw water for use in ore processing and dust suppression, and potable water for use in the Village, administration areas, Power Station cooling and Underground chiller systems. Groundwater abstraction from the Telfer Access Road Borefield is primarily used for maintenance and dust suppression along the Telfer Access Road.The total groundwater abstraction from the near mine borefields for the 2010 reporting period was 20,536 ML, whilst 1,666 ML of water was retained and recycled via the Process Plant, reflecting a 6.2 percent increase in abstraction from the previous reporting period.Water levels in 146 groundwater bores were measured monthly in order to monitor changes in the aquifers. The main observations in relation to changes to the water levels during the reporting period are as follows:

Water levels within the Telfer borefields have generally • declined slightly in response to increased abstraction from the operating borefields.A major cone of depression is centred over the Telfer • Underground Operations located below the Main Dome Open Pit and to a lesser extent the West Dome Open Pit. The cone of depression below the Main Dome is a result of underdrainage and dewatering associated with inflows into the Telfer Underground.Away from the areas of abstraction, water levels continue • to increase marginally under the apparent ongoing influence of significant rainfall/recharge events.A groundwater mound remains centred on TSF 1‑6. The mound • is the result of vertical leakage from the base of the Tailings Storage Facility (TSF). The groundwater mound shows signs of collapse as result of the cessation of tailings disposal to these facilities since October 2000.Some evidence of seepage from TSF7 is noted in observation • bores surrounding the facility, as seen by slightly elevated water levels. Some of the observations bores are located within the Staggers borefield and are also influenced by groundwater abstraction from this borefield.Water levels in Pit 9 South, Pit 9 North and Pit 10 continued • to decline as a result of continued pumping for use of water in ore processing activities.



CracowThe annual water allocation for the Cracow Project is 375 ML. The Project’s requirements are satisfied by pumping from existing surface water entitlements on the Dawson River. There have been no detectable impacts on the Dawson River by the abstraction of this water.HiddenValleyIn the last financial year, modifications were made to the processing plant to significantly reduce the amount of fresh water used and to increase the amount of treated recycled water utilised in the process. The plant water balance is still being refined to assess the exact effect of these changes, but fresh water usage is likely to have decreased by approximately 100 m³/h.

En9 impact of water withdrawalNone of our operations withdraw water from water bodies that are recognised by professionals to be particularly sensitive due to their relative size, function or status as a rare, threatened, or endangered system (or to their support of a particular endangered species of plant or animal). We do not withdraw water from a Ramsar‑listed wetland or any other nationally or internationally proclaimed conservation area.CadiaValleyAs indicated above, Cadia Valley obtains its water by reusing grey water from nearby towns, and from three surface streams (Cadiangullong Creek, Flyers Creek and the Belubula River). Pumping from Flyers Creek and the Belubula River is regulated to ensure at least minimal environmental flows are maintained. The building of the Cadiangullong Dam on the creek of that name has had a significant impact on flows in the creek. Cadia Valley’s development consent conditions stipulate that compensatory flows must be maintained along Cadiangullong Creek.Cadiangullong Creek flowsFlow requirements for Cadiangullong Creek are outlined in the Cadia Hill development consent and water licence conditions.Flow requirements for Cadiangullong Creek are:1 Flows between 0.4 ML/day and 3.4 ML/day into Cadiangullong

Dam (measured at Cadiangullong Creek Forestry gauge) must be matched or exceeded at Oaky Creek;

2 Flows must not fall below 0.4 ML/day at the Oaky Creek gauge regardless of inflows; and

3 For each and every three month period when one or more medium flow (12–15 ML/day) events are recorded upstream of the dam at Cadiangullong Creek Forestry gauge, at least one medium flow should be recorded at Oaky Creek gauge.

Cadiangullong Creek and Creek DiversionAs the result of mining activities at Cadia Hill Open Pit and Cadia Extended Pit, a 2.4 kilometre section of the Cadiangullong Creek has been diverted around the mining operations. A program has commenced to rehabilitate the Cadiangullong Creek diversion and enhance the Cadiangullong Creek Riparian environment.The final rehabilitation objective at Cadiangullong Creek is to create a riparian floodplain community which was previously cleared for agriculture and existed as a degraded pasture dominated by introduced perennial grasses until tubestock were planted in 2005. In 2010, the site had shown an improvement in LFA stability, infiltration and nutrient recycling indices and has now met completion targets.

Trees have been classified as individual trees or shrubs with a diameter greater than 5 cm and this year one tree was recorded, but fell short of meeting the Key Performance Indicator (KPI), with the diversity of tree species also falling short of meeting the target. The density and diversity of shrubs continue to fall within the KPI range and most shrub height classes were represented with more individuals being recorded in the larger height classes in 2010, and fewer in the smaller height classes but no individuals were yet >2m in height. The percent ground cover provided by the live perennial vegetation increased significantly resulting in a reduction in leaf litter. The total ground cover also increased but still fell short of meeting the completion criteria target. The total ground cover also increased but still fell short of achieving the completion criteria target, due to a small amount of bare ground remaining on average.The average number of native species recorded per square metre was slightly lower and in 2010 still did not meet KPIs and closure criteria targets. However, there was a significant increase in the number of exotic species per square metre, but completion criteria was not met. Overall diversity of native species was lower than the ranges provided by the KPI and did not meet closure targets in 2010. The number of exotic species increased, but did not fall within the KPI ranges. In terms of ecosystem composition, Cadiangullong Creek met several attributes of the reference sites, but did not contain the diversity of herbs, grasses and reeds.

En10 recycling and reuse of waterOur Cadia Valley, Telfer and Cracow operations are all located in areas where security of water supply is critical to maintaining current and future production levels. They are all ‘non‑discharge’ sites, which maximise the retention of water within the site. Telfer has a limited discharge licence which may be used to discharge excess water under controlled conditions of quality and flow. Because of its location in the wet tropics, Gosowong does not have a specific need for water recycling.CadiaValleySpecific water management strategies are carried out at the Cadia Valley operations. These include maximising the use of ‘internal’ water through recycling, ensuring that as much water is returned to the process plant from the tailings dam as possible (on average 80 percent), and utilising casual surface and dewatering water within the process circuit. Water recycling at Cadia Valley is, estimated to provide 82.5 percent of daily requirements (99 ML/day out of a total water demand of 120 ML/day).Cadia Valley also uses grey water from Orange, Blayney and Millthorpe (2,981 ML or 46 percent of annual water requirements in 2010). This reuse of municipal waste water serves two purposes:

it allows us to take less water directly from the • environment; andit reduces waste water treatment and disposal by the • local municipalities.TelferTelfer maximises process plant water recycling through the decantation of water from the tailings dam and through abstraction from the West Dome Open pit. These practices reduce the draw on the surrounding borefields. In 2010, 1,666 ML was recycled from the tailings storage facility and pit lakes.



CracowCracow recycles water from its tailings dam to minimise the amount of water drawn from the Dawson River. In 2010, 367 ML of water was recycled from the tailings storage facility.HiddenValleyHidden Valley recycles water from its tailings storage facilities to minimise the amount of water drawn from the Watut River system. In 2010, 763 ML of water was recycled from the tailings storage facility.

BiODiVErSityAustralia earns much more from minerals and energy exports than from rural products, yet the area of land affected by the whole energy and mineral sector is tiny by comparison (Australia State of the Environment Report 2001). However, some types of mining operations can have a large effect beyond the mine site itself. The mining industry has made vigorous efforts to manage operations to high environmental standards, in collaboration with government agencies. The Minerals Council of Australia has calculated that less than 0.01 percent of Australia’s landmass is directly affected by mining activities.Mining activities impact on biodiversity in a number of ways, including:

clearing of vegetation;• disposal of wastes (particularly tailings and waste rock);• use of both surface and groundwater;• physical disturbance to fauna; and• exposure of remote and inaccessible areas.•

Impacts at Newcrest’s operations are carefully managed through strict controls on disturbance and waste disposal. Areas proposed for development have pre‑disturbance surveys undertaken by our environmental staff, and development is undertaken according to an agreed management plan.We practice progressive rehabilitation, and have a commitment to return all mine sites to a pre‑determined land use following closure.

En11 Protected areas, or areas of high biodiversity valueA protected area is defined as an area that is designated, regulated, or managed to achieve specific conservation objectives. We do not own, lease or manage any land in protected areas.An area of high biodiversity value is defined as an area not subject to legal protection but recognised for important biodiversity features by a number of governmental and non‑governmental organisations. Cadia ValleyThe Cadia Valley has been significantly impacted by agricultural practices, including clearing and grazing. Some remnant woodland and riparian vegetation retain elements of their former biodiversity richness, and we are looking to enhance these elements (see restoring degraded areas below).

GosowongVegetation at Gosowong is classified as dense lowland forest, grading to open forest towards the coast. The forest type is similar to other lowland forests on Halmahera, and impacts are low on a regional basis. The Gosowong and Kencana sites are classified as Limited Production Forest (Hutan Produksi Terbatas) and the Toguraci minesite as Protection Forest (Hutan Lindung) (see Section EN12 below).TelferTelfer is located in a remote area of the Great Sandy Desert. The sandplains surrounding Telfer extend for hundreds of kilometres in all directions. The Telfer Project environmental impact assessment considered the area to have low conservation value. However, Telfer maintains a 5 ha Flora Reserve within the mining area for one priority species (Goodenia hartiana) identified during the Environmental Impact Assessment process.Specialist environmental consultants (Syrinx) conducted regional surveys for Goodenia hartiana over two days in May 2010. Syrinx conducted surveys of all the known populations of Goodenia hartiana. In 2009 the total number of monitored species equalled 51,000. However, the 2010 monitoring event recorded a drop of 11,000 plants. It was considered that the lack of rainfall and fire impact may have caused the vegetation deaths and low germination rates recorded in 2010.Due to the knowledge gaps related to this species, additional surveys following fire or rainfall events to further characterise this species may occur. In addition, surveys to further establish the regional context and identify if this species is present in surrounding national parks has been recommended.CracowThe Cracow vegetation has been substantially altered by grazing and past mining activity. The Project area is characterised by predominately cleared land with scattered trees. No threatened species or ecological communities have been recorded in the proposed Project disturbance areas. In the vicinity of the project area, a number of Endangered Regional Ecosystems (EREs) have been identified and management practices have been put in place to manage disturbance and/or mining related impacts.

En12 Significant impacts on protected areasAn issue confronting mining companies operating in Indonesia is Law 41/1999 which relates to Forestry. Law 41/1999 defines a number of forest designations which have different objectives. The three principal designations are:

Production forest:• a forest area having the main function of producing forest products;Protection forest:• a forest area having the main function of protecting life‑supporting systems for hydrology, preventing floods, controlling erosion, preventing sea water intrusion and maintaining soil fertility; andConservation forest:• a forest area with specific characteristics, having the main function of preserving plant and animal diversity and its ecosystem (includes National Parks, Nature Reserves, etc.).



Protection Forest is established primarily to safeguard catchment areas and control erosion and landslides. It doesnothave the same biodiversity conservation function as nature reserves and national parks.Forestry Law 41/1999 effectively prohibited open cut mining in land declared as Protection Forest. Prior to Law 41’s introduction, PTNHM held a Contract of Work agreement granted by the Government of Indonesia over the area in question. With the introduction of Law 41, the company experienced delays in the commencement of mining at Toguraci and worked closely with the Government to overcome the legal impasse. In 2003, the Minister of Forestry issued PTNHM an interim approval to commence development of Toguraci. In 2004, Law 41/1999 was revised by the Indonesian Parliament and the decision to allow PTNHM to continue mining the Toguraci site was subsequently ratified by the Constitutional Court in mid‑2005. Toguraci commenced development in July 2003 and the first gold was poured in February 2004. Mining ceased at Toguraci in September 2006.At the close of mining, rehabilitation will ensure that the key features of the Protection Forest are retained. As a result, the forest’s main function of protecting life‑supporting systems for hydrology, preventing floods, controlling erosion and maintaining soil fertility will be protected for future generations.

En13 habitats protected or restoredWe are committed to minimising our area of disturbance and to progressively rehabilitating those areas we do disturb.LandmanagementWe have equated ‘land for production activities’ to our primary mining leases which are held specifically for the purpose of mining. The total lease area equalled 192,681 hectares in 2010 the land impacted by actual mining is considerably less than this area, and can be subdivided into:

impermeable surfaces (i.e. utilised by fixed facilities (process • plant, roads, etc.) and unavailable for rehabilitation);disturbed areas; and• rehabilitated areas.•

0

40,000

80,000

120,000

160,000

200,000

Land for Mining Production Purposes(ha)

06 07 0908 10

Ridgeway/Ridgeway Deeps and Cracow are underground mining operations and consequently surface land area impacted by direct mining is minimal. At Telfer, the underground mining continues in parallel with open cut mining. The Kencana underground mine commenced operations in April 2006, and has replaced the Toguraci open cut mine which ceased operations in September 2006.

The land area and percentage of each land use category for the Group is shown in the table below. The percentage of each of these categories for our principal operations is shown in the table below.Landcategory ha %

Impermeable 794 0.55

Disturbed 4,845 3.38

Rehabilitated 1,249 0.87

Undisturbed 136,668 95.20

Totalproductiveland 143,556 100.0

MinesiterehabilitationCadia ValleyCVO currently owns and manages approximately 10,690 hectares of land, including land within the CVO Mining Lease and non‑mining areas currently used for either agistment grazing or nature conservation. The intrinsic nature of the operation of Cadia Hill Open Cut and Ridgeway Underground mine has resulted in disturbance of large areas of land. The rehabilitation program for the disturbed areas will ultimately reduce impacts through the enhancement and extension of areas of native ecosystems and strategies for sustainable land management that enhance the agricultural value of the land. Subsided areas associated with Ridgeway Underground require vigilant monitoring to ensure subsidence area is contained and remains within an exclusion zone which is kept securely fenced.Land management at CVO is based on sound land management principles, such as erosion prevention, pasture diversity, sustainable grazing management, and noxious weed control. Natural regeneration is promoted where practical to enhance biodiversity and landscape amenity.The objectives of the Cadia Valley Operations Land Management Plan are to:

Meet all related conditions of consent and to implement • sustainable land management practices across all Newcrest owned land at Cadia.Meet the Cadia Hill, Ridgeway Consent and Cadia East (and • other) requirements for the development and implementation of a:

Rehabilitation Plan;• Landscape Management Plan;• Weed Management Plan;• Vegetation Management Plan;• Soil Management Plan; and• Biosolids management Plan.•

Minimise the removal of existing vegetation to those areas • required for construction, operations or fire control.Prevent land degradation and to rehabilitate disturbed land • as soon as practicable to a level equal to or better than the original landscape.Manage existing pastures and remnant vegetation to ensure • minimal degradation to these areas.Control noxious weeds within the mining lease area.• Sustain and enhance the agricultural value of lands in a manner • consistent with the mining plans.To maximise soil stripping opportunities and implement sound • soil management practices.



CVO BiosolidsCVO has entered into an agreement with Orange City Council to receive and store biosolids for rehabilitation and soil enhancement purposes. Following the completion of an environmental review and gaining the relevant approvals, the storage of biosolids commenced in June 2007. The DECCW approved an exemption to allow the acceptance, storage and use of Orange City Council biosolids. The exemption relates to the Protection of the Environment Operations (Waste) Regulation 2005 allowing CVO to deviate from the EPA Biosolids Guidelines. Biosolids acceptance and use is also permitted under EP Licence 5590. Biosolids are managed in accordance with the CVO Land Management Plan.During the 2010 period, no biosolids were delivered by the Orange City Council to CVO’s storage area. The biosolids storage area is situated to the east of the Southern Waste Rock Dump and is contained within a bunded area with a sump to collect any runoff from the site. The CVO surface water monitoring program has been modified to include the sampling of thermo‑tolerant coliforms and E.Coli immediately downstream (PKLeach6) of the storage area. These results are considered background levels as there has been no discharge or release from the bunded area.GosowongGosowong has already rehabilitated over 80 percent of the available area disturbed during the Gosowong mining phase. Further areas will be rehabilitated in the coming year, including parts of the Toguraci mine and Kencana development.TelferTelfer has significant areas of disturbance from the first phase of mining. The current rehabilitation plan requires these areas to be re‑profiled and rehabilitated as part of the future mine plan.Monitoring of the mesa landform rehabilitation trial at Waste Dump thirteen continued during the reporting period, using photo monitoring points, transects, soil sampling and Ecosystem Function Analysis (EFA) for vegetation and erosion. Only minor erosion associated with local rainfall was recorded. Overall vegetation recorded was sparse as no seeding had taken place and weed species Kapok Bush was the dominant species.A topsoil balance was developed to determine if sufficient topsoil was available for the mesa landforms. Two rehabilitation methodologies were compared (mesa landform and berm and bench) with varying topsoil thickness. The balance indicated that there will be an excess of topsoil with a mesa landform, allowing the remaining topsoil volumes to be utilised for rehabilitation of other areas of the mine site and village.Research programs are an essential part of the development of Telfer’s waste rock dumps. The Mesa Land Forming Project combines botanic, landform evolution, topsoil, seed and weed research programs. The fourth annual Telfer Research and Development Review conference was held in February 2010.Ecohydrological characteristics of the natural and rehabilitation ecosystems continued from the previous year, supported by the ARC – linkage, Newcrest Mining Limited and Mining and Energy Research Institute of Western Australia (MERIWA). The projects include defining ecohydrological function of vegetation and soils associated with natural landforms, identifying associated seed dormancy and alleviation techniques, optimising topsoil management and how the findings of this work can be applied to rehabilitation sites in the Telfer area. Research findings during the reporting period include:

Clear differences in the responses of shrub and Spinifex species to large rainfall events following drought:

Acacia species growing in phosphorus poor soils were severely • limited by Phosphorus and they were very efficient in Phosphorus remobilisation during leaf senescence;Seed quality was assessed using x‑ray analysis. Initial seed fill • prior to cleaning to remove unfilled seed) ranged from ‹10 percent to ›95 percent;Improved seed dormancy alleviation methods for four species • in the Fabaceae family;Mean total number of emergent seedlings from topsoil • collected from three sand plain sites ranged from 342 to 861 seedlings/m²;Scrubbed sites had a larger intact seed bank than cleared and • burnt sites;There was a significant difference in mean seedling emergence • between soil types. Seedling emergence was highest from sand dune topsoil; andAera.javanica • prefers disturbed soils with a high clay content due to the increased water holding capacity.

New disturbance in the reporting period was primarily associated with exploration drilling, infrastructure development and expansion of burrow pits. Infrastructure development includes the Mill storm water dams and alterations to the main corridor. Surface Disturbance Permits for all land and vegetation disturbance at the site involves checking and completing all conditions required for land disturbance under the various land tenement lease conditions, licences, mining proposals and legislative requirements. Based on the surface disturbance permits submitted during the reporting period, a total of 20.22 ha was disturbed. The majority of the disturbance was associated with O’Callaghan’s exploration activities and small but significant disturbance for the pre‑stripping of the Stage 4 cut‑back of the Main Dome Open Pit.WeedsTelfer has a historic legacy of weed infestation on old waste dumps. The most common weed found on‑site that has the potential to negatively effect rehabilitation and mine closure is considered Aera javanica, or the Kapok Bush.BGPA conducted a three year weed research program, with finalisation of the program in October 2009. The interim results are as follows:

Herbicide treatments (glyphosate) on • A. javanica was determined to be the most effective herbicide trialled, in combination with a penetrant (Pulse) and a marking dye (Envirodye).Herbicide success relies on application during the growing • phase, preferably as a seedling is flowering. Environmental conditions play a large part in the efficacy of herbicide use – low wind, temperature and no rainfall are optimal.

This research will be integrated into the Telfer Weed Management Plan.



Waste Rock Dump 13 RehabilitationThe Waste Dump (WD) associated with disused Pit 13 was reshaped with the majority of the rehabilitation works concluded during the previous reporting period in accordance with Newcrest’s Waste Dump Management Plan (2004a).Newcrest has previously undertaken a series of trials on WD10 and WD11 to assess the mechanical application of the mesa landform methodology and subsequent initial rehabilitation success. The application of the mesa landform was also inline with the Ministerial Statement 606 where Newcrest was to integrate the final waste dumps with the surrounding environment, as mesa structures are characteristic of the region.During the reporting period the first round of a five year rehabilitation program commenced on Pit 13 was completed. Monitoring of revegetation and erosion of the landform was monitored using Ecosystem Functional Analysis (EFA) methods. In summary:

Only minor drainage channels were evident in the October 2009 • monitoring event. These drainage channels were left behind during the construction phase. It is anticipated flow channels will open up over the monitoring period. Erosion of slopes is monitored in datasets per slope, indicating minor erosion occurring on the slopes that can be attributed to localised rainfall.Overall vegetation was sparse, as no direct seeding of • vegetation was undertaken. All revegetation on WD 13 was the result of natural regeneration form the seed soil bank, with the predominant ground cover of Kapok Bush.

Seed and TopsoilThe seed and topsoil program commenced in March 2007 and has progressed to the stage of field trials in association with off‑site works at KPBG in Perth. The three year program was designed to aid management decisions relating to rehabilitation at Telfer through an improved understanding of seed and topsoil related issues.This project is into its final year with monitoring of all rehabilitation trials at Telfer to be completed in 2010 and off‑site studies carried out at Kings Park expected to be completed by February/March 2011. Interim results from 1 July 2009 to 30 June 2010 are outlined as follows:

Seed size had an effect on seedling emergence with a significant • decrease in seedling emergence at 1–2 cm depth for small seeded Triodia basedowii, T.pungens, T schinzii and Goodenia azurea and significant decrease in emergence at 5–10 cm depth for larger seeded Grevillia stenobotrya and Dodonea sericea.A significant difference in mean seedling emergence between • soil types. Seedling emergence was highest from sand dune topsoil.No difference in mean seedling emergence between sand plain • topsoil, sand plain subsoil and siltstone was evident. Seedling emergence was the lowest from sand plain topsoil mixed with rock armour and stony hills topsoil.

In‑situ topsoil handling experiments were set up to investigate the effect of mixing topsoil sourced from cleared sand plain, sand dune and stony hills with rock armour in one of two different rock dump positions on plant establishment and survivorship. In addition, the use of subsoil and hummock dumping was investigated in these trials. All treatment plots were established in 2008 and final monitoring will be completed in 2010. Interim results from 1 July 2009 to 30 June 2010 are outlined as follows:

Topsoil source and rock armour additions indicated a significant • difference in total seeding recruitment with more seedlings recruited from cleared sand plain topsoil that cleared sand dune topsoil. The lowest number of seedlings recruited occurred from cleared stony hills topsoil.There was a significant difference in mean seedling recruitment • derived from the topsoil seedbank, indicating that seed from topsoil without rock armour was three times greater than seedlings recruitment from topsoil mixed with rock armour.Seedling recruitment from wind blown seed from the weeds • Salsola, Kapok and Buffel grass was higher from topsoil mixed with rock armour. There was no significant difference in seedling recruitment and species richness between topsoil placed on rock armour and topsoil with no rock armour.Seedling recruitment was higher where subsoil was • incorporated in to the reconstruction soil profile with seedling recruitment greatest when topsoil was placed directly onto subsoil.Results from trials to investigate the effects of topsoil age • on seed emergence and recruitment indicate no significant difference in seedling emergence and species richness between sand plain topsoil returned immediately and topsoil stored for 1 year. Topsoil stockpiled for 2 years was spread in November 2009 and monitoring will occur in the following reporting period.Topsoil borrowing by measuring and comparing vegetation • cover, richness and diversity indices with undisturbed sites have indicated an increase in seeding recruitment in the past reporting period from ‹0.1 seedling/m² to .5 seedlings/m². However, seedling recruitment from recipient sites also showed an increase in seedling recruitment from 2008 to 2009, but with significantly lower numbers than at donor sites.

Seed BroadcastingVegetation species that do not germinate on rehabilitated areas following the return of topsoil may require reintroduction via seed broadcasting. Seed broadcasting is a problematic rehabilitation method due to very low success levels of viable plants resulting from seed germination. The purpose of the ‘Seed Broadcasting’ section of the Weed, Seed and Topsoil Program is to establish technologies that will increase abundance and diversity of plant species, enabling successful revegetation. Seeds from key species were collected by KPGB during November 2008 and April 2009 to investigate methods of overcoming seed dormancy. Overcoming seed dormancy is expected to increase the success rate of broadcast seeding.



Four species A.ancistropcarpa, A.stellaticeps, G.polyzygum and Goodenia azurea were broadcast into micro‑plots. In addition, seed burial in microplots and an undisturbed sand plain site were utilised as reference sites. Results from these trials showed that:

There was no seedling recruitment from seed broadcast on • to slope sites, while plateau sites returned few recruits.Seedling recruitment was greater from seed broadcast onto • topsoil mixed with rock armour than topsoil alone.Seedling recruitment was significantly higher from buried • seed than surface sown seed.

Additional testing in relation to the affect of topsoil age on seedling emergence from broadcast seed will be reported in the next financial year.CracowAt Cracow, we have made a commitment to rehabilitate areas of historical mining activity on Newcrest’s mining leases. As a requirement of Cracow’s Environmental Authority a closure plan has been prepared and is under review by the DERM.ExplorationThe Exploration group follows industry leading practice with regard to ground disturbance and rehabilitation. The development of access tracks and drill sites is done in such a way to minimise disturbance and facilitate effective rehabilitation. Drill site rehabilitation includes the removal of excess samples, rubbish and sump fluids, the filling of sumps, the capping of drill holes, the ripping of compacted areas, and the contouring and seeding of the site where appropriate.

En14 Strategies for managing impacts on biodiversityIn addition to our commitment to progressive rehabilitation, we have also committed to a number of projects to manage our impacts on biodiversity.CVO Off-Site Rehabilitation PlanThe Off‑Site Rehabilitation Plan will now be incorporated into the Landscape Management Plan, a requirement of the Cadia East project which will be completed by the end of the 2011 reporting period.Cadia Valley owns significant areas of agricultural land that has been extensively cleared for grazing. A major initiative is to undertake a program of corridor enhancement that will ultimately provide a network of regional vegetation corridors.The aim of these corridors is to:

conserve remnant vegetation;• link significant areas of remnant vegetation;• provide habitat for native flora and fauna; and• increase the sustainability and biodiversity of our farms.•

Rehabilitation monitoring is now being undertaken by an independent consultant as per the Ridgeway Consent Condition 3.4.3. The following table provides a summary of the progress in the implementation of the plan.Table:CVOStatusofVegetationCorridorProgram Planned LongTerm Completed 2011 ProposedType (ha) (ha) (ha)

General corridors 400 160 365Riparian corridors 258 8 188

TOTAL 658* 168* 533*

*Approximate figures only as at July 2010.Data obtained from rehabilitation monitoring indicates that the average tree/shrub density is 1300 trees/shrubs per hectare. Based on this figure, the ongoing rehabilitation program has resulted in approximately 855,000 trees being planted on Newcrest owned land.Farm Trees Program – CVOAs part of a program to encourage the fencing and development of treed areas on farms, 3,250 free farm trees have been provided by Cadia Valley to local landholders. Trees are distributed through local Landcare groups and this year included:

Flyers Creek Landcare Group;• Springside Landcare Group;• Blayney Landcare Group; and• Panuara Landcare Group.•

Since the commencement of this program, approximately 12,900 trees have been donated.Swallow Creek Revegetation Trial – CVOA series of revegetation trial sites have been established at the headwaters of Swallow Creek to investigate restoration strategies and techniques for using grassy, open eucalyptus woodland as riparian revegetation. Species trial results continue to show that Eucalyptus melliodora (Yellow Box) and E. goniocalyx (Bundy Box) are suited to the conditions of the site while there have been higher mortalities of E. dives (Broad‑leaved Peppermint). The density trial is showing that at rates of 250 and 500 seedlings/ha, trees are continuing to survive. The rate of 1,000 seedling/ha appear to be suffering higher mortalities. This would be partially due to the age of the seedlings (as they have been replanted several times due to cattle grazing damage), competition from perennial grasses and the impact of recent drought conditions.The Swallow Creek revegetation trial is monitored every two years and the site will be monitored during 2011.


EnvironmEntal PErformancE indicators

Subterranean Fauna – TelferSubterranean Fauna includes both troglofauna (terrestrial subterranean fauna) and stygofauna (aquatic subterranean fauna). It is unlikely that troglofauna will occur in the Telfer Region due to the lack of open caves or sink holes. However, with an understanding of the advancements in the field of subterranean fauna assessment, a baseline assessment of troglofauna was deemed necessary.In October 2009, Bennelongia Consulting Pty Ltd was engaged to continue the monitoring of subterranean fauna. This sampling event recorded 146 stygofaunal animals comprised of at least 15 species across seven taxonomic orders. However, the population structure appears to be limited in distribution as only seven of the 30 bores samples yielded stygofauna specimens. There was a marked contrast in yield between bores outside the areas of mining and dewatering and those within it. Five of the 8 regional bores yielded stygofauna compared with only 2 of 22 near the mine corridor bores. These trends are consistent with sampling conducted in the previous 5 year management plan.A correlation with abundance of species and the depth to water table indicated a number of negative relationships, especially within bores sampled in the mine corridor. This may be representative of mining activities impacting the stygofauna populations. However, a number of factors (i.e. sampling and geology) will require to be addressed in the next monitoring program to provide further evidence.Dingo management – TelferDingoes (Canis lupus dingo) are perceived as a safety issue in most mine sites in Western Australia. Reported attacks from dingo–human interaction are well known in Australia, mainly involving small children. However, there is a risk that an attack may occur in Telfer because of the experience at Fraser Island and other mine villages where it is known that dingoes become competitive for food, especially if people are feeding them or food is readily available.The Dingo Management Plan continued to form the basis of dingo management at Telfer. Throughout the reporting period, the following activities occurred:

Presentations regarding dingo behaviour were held for various • crews/departments;Alterations to the on‑site barbecue request form stating that • persons holding the barbecue are responsible for ensuring that dingoes are not fed directly or indirectly. Persons caught feeding dingoes may have their employment terminated;Minimisation of access to food sources on‑site. Dingo bin stands • continued to be used to prevent dingoes knocking wheelie bins over to obtain food. The putrescible landfill was covered daily to minimise access by dingoes;An audit to estimate near site populations was conducted; and• Posters and site notices were issued across site throughout • the reporting period to discourage interaction with dingoes and further educate the workforce.

Treatment of injured wildlifeThe partnership between Telfer and Kanyana Wildlife Rehabilitation Centre (Kanyana) continued throughout the reporting period. This partnership involves Telfer making an annual donation to Kanyana in exchange for their ongoing support in wildlife rehabilitation, including training on basic wildlife first aid. This training is focussed on assessing and treating birds, as they are the predominant injured animal treated at Telfer, for stabilisation and immediate air lift to Perth. During the reporting period, five animals were successfully treated on‑site and five birds were sent off‑site to be rehabilitated at Kanyana. The rehabilitated birds spent 1–2 weeks in a purpose built pre‑release aviary at Telfer before release, to allow for acclimatisation, whilst still being provided with food and protection from predators.

EN15 Listed speciesA total of 47 IUCN Red List species potentially occur in habitats affected by operations (this does not include species classified on the IUCN Red List as being of ‘Least Concern’). None of these species are significantly impacted by our operations.Goodenia hartiana Survey – TelferSpecialist environmental consultants (Syrinx) conducted regional surveys for Goodenia hartiana over 2 days in May 2010. Syrinx conducted surveys of all the known populations of Goodenia hartiana. In 2009, the total number of monitored species equalled 51,000. However, the 2010 monitoring event recorded a drop of 11,000 plants. It was considered that the lack of rainfall and fire impact may have caused the vegetation deaths and low germination rates recorded in 2010.Due to the knowledge gaps related to this species, additional surveys following fire or rainfall events to further characterise this species may occur. In addition, surveys to further establish the regional context and identify if this species is present in surrounding National Parks has been recommended.Squirrel Glider – CVOTwo vertebrate fauna surveys have been undertaken within the Southern Remnant and the immediate surrounds, including:

Southern Remnant fauna Survey (Conducted by Place Planning • and Design (for Resource Strategies) in 2002). (CHPL 2002); andSouthern Remnant fauna survey as a component of the Cadia • East Project (Conducted by Western Research Institute (WRI) in 2006–07).

Two threatened fauna species listed as Vulnerable in the TSC Act were recorded during the 2002 survey, namely the Squirrel Glider (Petaurus norfolcensis) and Yellow‑bellied Sheathtail Bat (Saccolaimus flaviventris). The record for the Squirrel Gilder is regionally significant given the lack of records for this species within the region (i.e. there are no records for this species on the Atlas of NSW Wildlife for the Cowra, Blayney, Molong or Orange 1:100,000 map sheets). The squirrel glider was observed through spotlighting and call playback monitoring techniques in 2002, and was again recorded by Place Planning and Design in 2008 as part of vegetation clearance assessments associated with the expansion of the South Waste Rock Dump (April 2008 Modification). The 2006–07 survey by WRI failed to record the presence of the squirrel glider in the survey area.



The modification to the South Waste Rock Dump in April 2008 saw approximately 38 ha of vegetation in the Southern Remnant area cleared. Due to the reduction of potential habitat for the squirrel glider, a series of nest boxes have been installed in the remaining woodland. Five nest boxes in total have been distributed throughout the woodland in areas considered high potential habitat areas. A monitoring program has been developed to inspect the nest boxes on a quarterly basis for occupancy.A fauna survey was undertaken by Cenwest Consulting in September 2009 in the Southern Remnant to establish the presence of the squirrel glider. The findings of the report concluded that it is very unlikely that a Squirrel Glider resides within the Southern Remnant, or in the immediate surrounds, and even less likely that a viable population of the Squirrel Glider is extant within the remnant. From time to time it is possible that individual Squirrel Gliders may also be observed within suitable locations of the Cadia Valley Operations.

mm3 number of sites requiring biodiversity management plansNewcrest sites have individual management plans which deal directly or indirectly with elements of biodiversity. These are typically flora and fauna management plans, rehabilitation management plans, and land management plans. Telfer has a requirement to produce a Stygofauna Management Plan. Feral or pest control programs for both flora (weeds) and fauna are also undertaken ay Newcrest’s operations which further contribute to biodiversity conservation.Cadia Valley Operations manages their current land holdings not required for mining activities as per the Farm Management Plan and is made available under the grazing rights agreement, Grazing Management Protocol and Farm Safety Management Plan.

EmiSSiOnS, EffluEntS anD WaStE

En16 greenhouse gas emissionsNationalGreenhouseandEnergyReporting(NGERs)The National Greenhouse and Energy Reporting Act 2007 (the Act) was passed on 29 September 2007 establishing a mandatory reporting system for corporate greenhouse gas emissions, energy production and consumption. The first reporting period under the Act commenced on 1 July 2008.Key features of the Act are:

Reporting of greenhouse gas emissions, energy consumption • and production by large corporations.Public disclosure of corporate level greenhouse gas emissions • and energy information.Consistent and comparable data available for decision making, • in particular, the development of the Carbon Pollution Reduction Scheme.

Newcrest is required to report on each of its facilities. The reporting triggers for corporations are as follows:

They have operational control of a facility that emits 25 kilotonnes • or more of greenhouse gases (CO2 equivalent), or produce or consume 100 terajoules or more of energy; orTheir corporate group emits 125 kilotonnes or more greenhouse • gases (CO2 equivalent), or produces or consumes 500 terajoules or more of energy.

Newcrest is a registered corporation and is required to report greenhouse gases and energy for the financial year during which it first met the threshold, this threshold was met in 2009. NGER reporting will be completed on an annual basis to meet the Act’s reporting requirements.GreenhousegasemissionsGreenhouse gas emissions during 2010 increased in total and relative terms.

0

10

20

30

40

50

Greenhouse GasEmissons(kg CO2e/t)

06 07 0908 10

The greenhouse gas emissions per tonne treated for the years 2006 through 2010 are shown in the figure above. Greenhouse gas emissions increased by 4 percent per tonne of ore treated compared to the previous year.Indirect greenhouse gas emissions (such as that resulting from the purchase of electricity) are included in the emissions calculation above.

En17 Other indirect greenhouse gas emissionsNo attempt has been made to calculate indirect greenhouse gas emissions from such activities as business travel and employee commuting. It is anticipated that these emissions would be small in relation to our overall emissions.There are a number of potential indirect greenhouse gas emission sources on our mine sites. On our mine sites these sources include:

Enteric fermentation: • methane emissions from herbivores as a by‑product of enteric fermentation, a digestive process by which carbohydrates are broken down by micro‑organisms into simple molecules for absorption into the bloodstream. We own a number of agricultural properties, particularly around our Cadia Valley mine, which are leased for grazing.Land‑use change:• total emissions from land use change activities (activities impact on three different carbon sources/sinks: aboveground biomass, belowground biomass and soil carbon). At both Cadia Valley and Gosowong there is the clearing of forest and woodland areas for operational purposes. While some of these areas will be rehabilitated, there is a net loss of standing biomass.Solid waste disposal:• methane emissions from anaerobic microbial decomposition of organic matter in solid waste disposal sites. Telfer has an on‑site landfill facility, while Cadia Valley and Cracow dispose of solid waste in nearby Council managed facilities. Gosowong operates a waste incinerator.

At this stage, we have made no attempt to measure and quantify greenhouse gas emissions from these indirect sources. It is reasonable to assume that they would be very small in comparison with the main emission sources of electricity and diesel consumption.



En18 greenhouse gas reduction initiativesA number of energy conservation and efficiency measures have been implemented across the group as outlined in section EN5 which contributes to greenhouse gas reduction.

En19 Ozone‑depleting substancesWe have taken deliberate steps to reduce the amount of ozone‑depleting substances used at our operations. No associated emissions were reported in 2010.

En20 Significant air emissionsThere are a number of emissions to air other than those included in the greenhouse gas emissions inventory. The principal emissions are nitrous oxides (NOx), sulphur dioxide (SOx) and carbon monoxide (CO) and particulate matter (PM10).Each of the emissions is reported annually as part of our obligation to report emissions to the National Pollutant Inventory (NPI). The NPI covers Australian based operations only, and the data below does not include information from our Indonesian or MMJV operation. Our full submission to the NPI can be found at the NPI website www.npi.gov.au.The significant air emissions (SO2, NOx and CO) per tonne treated for the years 2006 through 2010 are shown in the figure opposite for our Australian and Indonesian operations. In Australia, these estimates are derived using National Pollutant Inventory Emission Estimation Manuals. A similar scheme does not exist in Indonesia and we have applied NPI emission factors as a default measure and as such the Gosowong numbers are considered estimates only and are reported for completeness.The table below shows the breakdown of the principal air emissions by type.Emissions(tonnes) NOx SO2 CO

2006 6,861 221 1,770

2007 3,478 220 1,695

2008 4,185 457 1,626

2009 4,844 416 2,026

2010 5,012 681 1,961

Particulate matter (PM10) emissions are estimated using the NPI emissions estimation techniques. The estimation does not necessarily reflect the environmental impact of these emissions. PM10 emissions for the groups Australian operations totalled 20,154 tonnes.

En21 Water dischargesNewcrest has two sites with licensed discharge points, at Gosowong and Hidden Valley. The total volume of water discharged was 4,402 ML.CadiaValleyCadia Valley is designed as a non‑discharge site. No water was released from operational areas to the environment in 2010.GosowongAt Gosowong, tailings pass through a cyanide detoxification unit before being discharged to the tailings dam. Excess water from the tailings dam passes through a series of polishing ponds before being discharged to a tributary of the Kobok River. The level of cyanide in the discharge water is routinely monitored, and has not approached the upper limit standard of 0.5 mg/L CNfree.

TelferTelfer has a licensed discharge point which permits controlled discharge of water to the environment following testing to ensure it meets preset licence conditions. No releases to the environment were made in 2010.CracowThere was no active release of water to the environment from Cracow in 2010.HiddenValleyHidden Valley has a licensed discharge point and has developed a comprehensive model to ensure that any water discharges do not exceed downstream water quality criteria.

mm6 large volume process wastesWe have two principal process wastes: waste rock and tailings.WasterockWaste rock is material removed from the top of the ore body in our open‑cut mines. It is usually placed in waste rock dumps on the perimeter of the pit; however, where possible we will use this material to fill in mined‑out pits or to build tailings dams and roads. The waste rock dumps are contoured and progressively rehabilitated. Any material with the potential to generate acid mine drainage is encapsulated with suitable inert material within the dump.

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Waste rock productionThe waste rock produced for the years 2006 through 2010 is shown in the graph above. Waste rock removal increased by 24 percent compared to the previous year, reflecting an increase in production at Telfer and the inclusion of MMJV.ARD researchThe problem of acid rock drainage (ARD) encompasses all issues associated with the actual and potential environmental effects of sulphide oxidation resulting from mining activities. Its significant potential for long‑term environmental degradation makes it one of the biggest environmental issues facing the mining industry. Newcrest is actively managing ARD at each of our operations.Waste rock from Cadia Hill falls into three categories due to the geology of the orebody:

low‑grade ore (mineralised waste);• potentially acid forming (PAF) waste; or• non‑acid forming (NAF) waste.•



PAF waste is encapsulated within NAF waste rock to minimise the potential for it to produce acid. During the reporting year, research relating to acid rock drainage at CVO included:

Hydrogeological modelling of the South Waste Dump; and• Column leach program. Summaries of the status of these • research projects are detailed below.

Hydrogeological modelling of the South Waste DumpIn 2007–08, CVO commenced a hydrogeological modelling project for the South Waste Dump (SWD) to further develop and final cover design for the rock dump.CVO commissioned external consultants to undertake a series of studies including:

Evaluation of Waste Rock Compaction Field Trials at Cadia • Valley Operations;Literature review of the application of geosynthetic materials • in the closure of mine waste storage facilities;Assessment of Internal Dump Clay layers on Seepage from • the SWRD;3D Seepage and Solute Transport Assessment of the • SWRD; andSoil Atmosphere Modelling.•

Studies have incorporated and utilised data from several sources including the CVO ARD Column Program, CVO ARD cover trial and North Waste Rock Dump cover design project.Innovative landform and closure designs for waste rock dumpsThe collaborative research between CVO, The University of Queensland (UQ), and the Australian Research Council (Financial Assistance Partner) involving the instrumented Trial Waste Rock Dump (TWRD) has reached the end of its research phase (31 December 2007). As a result of the collaborative research, CVO has a demonstration instrumented. During the reporting year, works involved the finalisation and submission of the thesis (Rhode 2009). CVO continues to collect data from the trial site and forward it to the University of Queensland.Hidden Valley P933A AMIRA Research ProjectHVJV is a part sponsor of the AMIRA Research Project 933A – Alternative Treatment Options for Long Term Acid Rock Drainage Control. The project in is its first year of a 3 year duration. The Hidden Valley site is the subject of a case study.TailingsTailings are the finely ground residue left after the ore has passed through the process plant and the valuable minerals have been extracted. This material is pumped as slurry to a purpose built tailings storage facility. At the end of the mine life, the tailings storage facility is allowed to dry, and then contoured and rehabilitated.

Tailings productionThe tailings produced for the years 2006 through 2010 are shown in the graph below. Tailings production reported a minor decrease of 1 percent.

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En22 Other wastesOur operations are progressively establishing waste discrimination, collection, storage, recycling and disposal programs.WastemanagementprogramsTelferTelfer has implemented its site wide waste management and recycling program known as ‘Target 2010’, through a Port Hedland based waste management service provider. Underpinning the program is the ‘Waste Facility Operators Procedure (2010–2015)’. This procedure provides site specific information of how the waste management facility at Telfer is managed. The main objective of the procedure is to promote the minimisation of waste generation and the safe handling and treatment and disposal of non‑mineral waste generated at Telfer.Landfill lift: In early 2010, the Telfer landfill reached its capacity. The facility was upgraded with a second lift, which has a design life of 5 years. Stage 2 includes additional bioremediation pads and industrial and putrescibles waste cells, designed on the past 3 years data of waste generation.The volume of materials processed through the facility over the last 2 years is shown in the Table below:Material Volume2010(m³) Volume2009(m³)

Aluminium 27 97.50

Assay samples 438 229.50

Cardboard 1,481.3 1,459.50

Food Waste 6,351.84 10,205.16

Glass 144 115.40

Green Waste 100.5 1,140.00

Steel Not recorded 174.00

Industrial 9,670.5 11,538.60

Medical Waste 0.36 0.24

Plastics 142.6 127.50

Scrap Metal Not recorded 11,742.50

Used Tyres Not recorded 96.00



Cadia ValleyDuring 2006, Cadia Valley awarded a Total Waste Management Contract to Thiess Services. The aim of the Total Waste Management contract is to have one dedicated point of contact for waste management on‑site and opportunities for waste avoidance and recycling can be maximised. To achieve this aim, a colour coded waste receptacle system has been implemented and a dedicated waste transfer site has been constructed.The 2010 year has seen an increase in general waste generation. This is primarily due to the increase in construction works at Ridgeway Deeps and Cadia East construction. Recyclable materials have also increased due to construction activity and CVO taking over the management of the Heavy Vehicle Fleet Workshop and associated waste streams.A recycling target of 55 percent has been set.The following waste volumes were removed from site in 2010:

general waste 1,500,290 kg;• paper and cardboard not recorded;• oil filters 38,592 kg;• waste grease 50,225 litres;• oily rags 22,157 kg; and• scrap steel 1,276,910 kg.•

GosowongGosowong has established a waste facility to better manage wastes generated on‑site. The facility includes two incinerators, seven bioreactors (with the aim of producing a fertiliser for application in mine rehabilitation programs) and a hazardous waste storage area.Waste generated on site includes:

scrap metal ~ 23 tonne (recycled);• waste tyres ~ 21,000 kg;• rubber hose 17 kg;• domestic waste, 799 tonnes – fed straight into incinerator • and bio‑reactors; andsolid hazardous waste (used batteries, medicines, used oil • filters, racks, used packages from Mill) ~ 16,000 kg.HazardouswastesLiquid wasteBy far the largest volume of hazardous liquid waste is waste hydrocarbons. The volume disposed of by our operations during 2010 amounted to 1,813 kilolitres. All of this material was removed from site by a licensed contractor for reprocessing or use as a fuel source.Solid wastesThe two largest hazardous wastes at our operations in 2010 are tyres (3,581 tonnes) and batteries (832 tonnes). Passenger tyres are recycled off‑site, while oversized tyres are used in rehabilitation or protection structures, buried in the waste rock dumps, or removed from site for recycling. Batteries are removed from site for recycling.

Non-hazardouswastesQuantities of domestic waste (including putrescible waste and packaging) were either disposed of at managed disposal facilities at the operations (Telfer), incinerated (Gosowong) or taken to the local municipal landfill (Cadia Valley and Cracow). Non‑hazardous waste amounted to 15,643 tonnes in 2010.MetalrecyclingScrap metal (principally steel, copper and aluminium) is stored on site for recycling. A total of 2,252 tonnes of metals were recycled off‑site in 2010.

En23 Significant spillsA spill is defined as the accidental release of a hazardous substance that can affect human health, land, vegetation, water bodies, and groundwater.Our operations had a total of 9 hydrocarbon and 13 chemical spills in 2010 amounting to a total volume of approximately 5,126,440 litres. Two large spills, one spill at Gosowong refers to a broken tailings line detoxified tailings, whilst the second spill at Telfer refers to a spill at the processing plant. Spills were immediately contained and any contaminated soil removed to a designated treatment area for remediation. There was no significant impact from any of these spills.

En24 transport of hazardous wasteWe do not import, export or treat waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII.

En25 Water bodies significantly affected by dischargesThere is no evidence of water bodies or related ecosystems being significantly affected by discharges of water and run‑off in year ended 30 June 2010.Hidden Valley Gold Mine (Morobe Province, Papua New Guinea)Newcrest became aware in late 2009 of concerns among communities along the Watut River regarding damage to crops and gardens as a result of flooding and that sediment run‑off from the mine construction may have contributed to the flooding.The Hidden Valley Gold Mine is owned and operated under a 50:50 joint venture between a subsidiary of Newcrest and a subsidiary of Harmony Gold of South Africa.The joint venture has undertaken a number of studies to assess the sediment issue and the current and future impact of activities at the Hidden Valley Gold Mine on the Watut River.Sediment from the Hidden Valley Gold Mine is the result of run‑off of top soil and weathered and eroded rock excavated during the intensive construction period of the mine.Importantly, no tailings are discharged into the river from the Hidden Valley Gold Mine. All mine tailings, or processed ore waste, are stored in an engineered tailings storage facility.Significant progress has been made following actions implemented by the joint venture, including the cessation of side‑casting of overburden in September 2009 and placement of waste rock into engineered waste rock dumps, the construction of sediment traps and ongoing revegetation of slopes exposed during the construction period.



The joint venture continues to monitor and manage the impact of mine‑related sediment on the Watut River.Following consultation with communities along the river, the joint venture has undertaken a voluntary compensation process for landholders whose crops and gardens were damaged by flooding, regardless of whether the flooding was due to mine‑related sediment or naturally occurring events such as landslips and other non‑mine related causes.The voluntary compensation process was largely complete as at the end of calendar year 2010 with more than 3,000 landholders receiving compensation calculated in accordance with the Papua New Guinea Valuer General’s schedule for compensation payments.GosowongGosowong is the only operation which routinely discharges water from the mine site to the environment. Tailings are detoxified before release to the tailings dam, and water discharged from the tailings dam to the environment is routinely monitored to ensure it meets strict water quality guidelines. Monitoring shows no deterioration in water quality in the Kobok River below the discharge point. PTNHM doesnotrelease tailings from the tailings dam.

PrODuCtS anD SErViCESWe produce two principal products; gold‑copper concentrate and gold doré.

En26 Environmental impacts of products and servicesProductsCopper-gold concentrateCopper occurs naturally in the air we breathe, the water we drink, and the soil in which we grow our food. This essential micronutrient plays an important role in protecting the environment and the health of every living thing.Most copper released to air, water, sediment, and soil strongly attaches to other particles, thus reducing the toxicity of copper. Copper can be transported as particles released into the atmosphere or as dissolved compounds in natural waters.Copper is essential to animals and plants, while at the same time being toxic to many bacteria and viruses. It is commonly found as copper in natural waters and the free copper ion is potentially very toxic to aquatic life, both acutely and chronically. Its toxicity increases with decreasing water hardness and dissolved oxygen concentration, and decreases with high concentrations of dissolved organic compounds and suspended solids. Alkalinity and pH are other factors that influence copper toxicity. Copper is expected to bioaccumulate in fish tissues. The fact that it is normally complex‑bound in soil, greatly diminishing its toxicity.Gold doréGold’s lack of toxicity and its compatibility with living systems make it indispensable in dentistry and medicine. It has no detrimental effect when released to the environment, as it is an inert (i.e. non‑reactive) metal.

ServicesSuppliersOur principal suppliers, and the commodity they supplied, are shown below:

BP Australia – fuel and lubricants;• Byrnecut Mining – mining services;• Dyno Nobel – explosives• GE International – electricity (Telfer);• Donhad – grinding media;• Orica – reagents and chemicals;• Sandvik Mining – mobile equipment and maintenance services;• Atlas Copco – mobile equipment and maintenance services;• Pinnacle Drilling – drilling equipment and services;• Boart Longyear – drilling equipment and services;• Liebherr Australia – mobile equipment and • maintenance services;Downer EDI – mining services; and• Westrac Equipment – mobile equipment and • maintenance services.

We expect our suppliers to conform to the same high environmental standards that we impose on our operations. Environmental conditions are included in key supply contracts to ensure that performance standards are understood. Any environmental incidents which are caused by our suppliers, and which occur on our sites, are included in our environmental incident data.ContractorsOur principal contractors, and the service they supplied, are shown below:

Byrnecut Mining – mining services;• Liebherr Australia – mining services;• Downer EDI (formerly Roche Mining) – mining services;• Westrac (Australia) – mobile equipment and maintenance • services; andESS – catering and camp servicing.•

We also expect our contractors to conform to the same high environmental standards that we impose on our operations. Environmental conditions are included in key contracts to ensure that performance standards are understood. Any environmental incidents which are caused by our contractors, and which occur on our sites, are included in our environmental incident data.



En27 Product recyclingCopperconcentrateCopper has the longest history of recycling of any material known to civilization. Today, it remains one of the most widely reused materials on the planet. About 80 percent of all the copper ever used remains in use today and about 40 percent of copper used annually is recycled from prior uses. This is a much higher level of reuse than for other metals.Recycling is an important economic activity with significant environmental benefits. Not only does recycling copper result in more efficient use of natural resources, it also results in energy savings and a reduction of waste sent to landfills. Because copper can be reused, the wealth of this natural resource can be preserved for future generations.Although copper’s virtually infinite recyclability makes it environmentally advantageous for use in a variety of products, worldwide demand cannot be met exclusively by secondary copper. Continued production of new copper is also required to meet human needs.GolddoréMost of the 145,000 tonnes of gold that has ever been mined still exists today. In part, this is because much of the supply of gold comes from recycled scrap, especially old jewellery.Because of its inherent high value, gold has been recycled since it was first discovered before the Bronze Age. Modern jewellery or dental crowns may contain some gold that was mined in prehistoric times and formed part of a valued gold artefact. Today, at least 15 percent of annual gold consumption is recycled each year.

COmPlianCE

En28 incidents of, and fines for, non‑complianceEnvironmental incident classification is based on qualitative measures of impact (or potential impact) as defined in AS 4360:2004 Risk Management.ReportableenvironmentalincidentsThe reportable environmental incidents per million hours (Category II and above) for the years 2006 through 2010 are shown in the graph below. There was a decrease in the number of incidents per million hours worked, from to 2.2 in 2009 to 2.1 in 2010. The 2010 year includes environmental incident data from the Hidden Valley – Morobe Mining Joint Venture.

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There were a total of 37 environmental incidents reported during 2010 (32 Category II incidents and 5 Category III incidents). Of the 37 reportable incidents, there were 13 chemical spills and 9 hydrocarbon spills.All incidents were resolved during the reporting year, and appropriate action taken where necessary to prevent future occurrences.Finesfornon-complianceThere were no fines recorded against the Company during 2010 for environmental breaches.Non-monetarysanctionsThere were no non‑monetary sanctions recorded against the Company during 2010 for environmental breaches.

tranSPOrt

En29 Significant environmental impacts of transportationTransport is an essential element in operating our business. Across the Group, we use road, rail, air and sea transport to move people, goods and products to, and from, and our operations. In addition, we utilise conveyers and pipelines to transport material around our sites and, in some cases (see below), to and from our sites.SignificantexternaltransportroutesCadia ValleyCadia Valley is located 25 kilometres from the City of Orange in Central New South Wales. Transport of goods to the Cadia Valley operation is by road transport. A significant amount of material, including diesel is transported to Cadia Valley from Orange, with a smaller amount being transported from further regional and national locations. Return water from the Blayney dewatering facility is pumped back to Cadia Valley, and grey water is also brought from Orange to site by pipeline. Electrical transmission is by overhead power line connecting Cadia Valley to the NSW grid.Copper concentrate is pumped from Cadia Valley via a buried pipeline to a railhead at Blayney, where it is dewatered before being loaded on trains for transport to Port Kembla. From Port Kembla, the copper concentrate is shipped to smelters in Asia.Our workforce travels from Orange and surrounding towns and properties via private vehicles to the Cadia Valley site. Consideration has been given to utilising buses to transport employees, but variable shift time makes this option uneconomic. Orange has an air‑link to Sydney.TelferTelfer is located south‑east of Port Hedland in the Pilbara region of Western Australia. Transport to the Telfer site is by a 900 kilometre round trip from Port Hedland. Part of this trip is on public roads (320 kilometres), with the last 130 kilometres on Telfer’s own access road. Some 320 kilometres of the total road length is sealed. Natural gas for power generation is brought to site along a 440 kilometre buried pipeline from Port Hedland.Copper concentrate is transported from Telfer by road to the Port of Port Hedland where it is loaded onto ships for transport to smelters in Asia.Telfer is a fly in/fly out operation, with daily air‑links to Perth via charter aircraft.



GosowongGosowong is located 15 kilometres from the port site of Kao Bay on the Island of Halmahera, Indonesia. Bulk material, including diesel and reagents, are barged from Singapore to the port site, and then by truck to the mine. Power is generated in a diesel on‑site power station. There are no significant amounts of bulk material shipped from Gosowong, but some bulk wastes (e.g. waste oil) are sent off the island by barge.Gosowong has a regular charter air service from Manado on the Island of Sulawesi for moving people and some goods to and from Halmahera. Local employees are transported to and from the site by bus.CracowCracow is located 50 kilometres by road from Theodore in Central Queensland. Bulk goods are brought by road to Cracow from Gladstone and Theodore. Power is supplied to Cracow by an overhead power line from the Queensland grid, and water is pumped from the Dawson River. There are no bulk materials shipped out of Cracow.Cracow operates a charter air service from Brisbane for key personnel. Some of our contract workforce travel to and from site by bus from cities on the central Queensland coast.InternaltransportationInternal transportation is broadly similar at each operation. Trucks are used to transport the bulk commodities of waste rock and ore. Conveyors are used extensively to move crushed ore at the front‑end of our process, including from the underground crusher at Ridgeway to the surface process plant. Reagents and bulk materials such as tailings and water are pumped around the site.The internal movement of people is usually by light vehicle.TransportimpactsThere are a number of potential impacts related to transportation. The most significant of these include:

increased road traffic volumes (with associated increased noise • levels and road damage);dust generation from unsealed roads; fuel consumption • (generating greenhouse gasses and other emissions); andthe potential for release of potentially hazardous material • (diesel, reagents, etc.) in the event of an accident or spill.

Increased traffic volumesBuilding and operating a mine results in significant increases in road traffic volumes, often on local country roads. This results in a number of impacts, including an increased potential for traffic accidents, increased noise levels and road damage. At Cadia Valley, we work with, and contribute to, local authorities in upgrading and maintaining heavily trafficked transport routes. We periodically monitor road noise at nearby sensitive locations, and where necessary, will look to establish mitigation measures (e.g. noise barriers).Greenhouse gas emissions from transportNewcrest recognises that transport accounts for a significant proportion of Australia’s greenhouse gas emissions. According to the Department of Climate Change ‘National Greenhouse Gas Inventory 2006’, transport, which includes road transport, domestic air transport, coastal shipping and rail transport, accounted for 13.7 percent of net national greenhouse gas emissions in 2006 the majority of which are from road transport. Transport emissions are mostly carbon dioxide, with small amounts of nitrous oxide and methane.We implement a number of programs to minimise emissions from our trucks and light vehicles. These include:

regular maintenance to ensure that vehicles are • operating efficiently;routine grading of roads to maintain a consistent gradient and • smooth surface;correct inflation of vehicle tyres;• driver training, including the use of a simulator at Cadia Valley, • to maximise efficient vehicle operation;satellite tracking to minimise truck haul distances; and• regular road watering to reduce fugitive dust.•

Potential spills of hazardous materialsThe transport of hazardous materials (including diesel and cyanide) has the potential to cause harm to human health or the environment in the event of a spill. It is a regulatory requirement for all contractors who transport hazardous material to have emergency response plans in place. We reinforce this requirement by ensuring that major transport contracts have clauses relating to emergency response.All of our operations have emergency response plans in place, and have trained emergency response crews and emergency vehicles on‑site. Emergency response plans are tested periodically, and are coordinated with civil emergency response authorities.



OVErall

En30 Environmental expendituresBecause environmental considerations are now integrated in all aspects of our operations and not accounted for separately, environmental expenditure is very difficult to determine. Considerable amounts are expended in mining, processing, energy supply and other areas of the operations not related to ‘traditional environmental activities’. These activities include shaping and top‑soiling of waste rock dumps (considered as part of mining costs) and pollution control (an operational cost). It is estimated that many millions of dollars have been expended in environmentally related aspects of our operations.

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EnvironmentalexpenditureThe total amount of quantifiable environmental expenditure (operating and capital) for 2010 was $14.6 million. The numbers outlined do not reflect the full sum of expenditures on environmentally related initiatives, rather those that can be distinguished from our ‘production’ activities.Itemised in the table below are the estimated current environmental expenditures in a number of key areas. 2010 2009CostArea ($’000) ($’000)

Research and Development 459 812

Rehabilitation 806 424

Monitoring 4,607 1,086

Heritage and Conservation 102 951

Environmental Management 6,270 4,539

Permitting and Licensing 403 326

Total 12,647 8,138

EnvironmentalpersonnelWe employ a number of environmental personnel at our sites to plan, implement and monitor environmental programs, and to provide specialist advice to our operational people. 2010 2009Level (No.) (No.)

Professional 29 22

Technical 18 14

Unskilled 34 36

Total 81 72

ConsultantsWe also make extensive use of consultants to support our own environmental specialists. In most cases, consultants are engaged to provide specialist skills which are not available within our own people, however, we also use consultants to supplement our own resources during times of peak activity.

OPEratiOnS ClOSurEmm10 mine closureStatusofmineclosureplansClosure planning is an integral component of mine development and operation. All operations have closure plans in place. The Cracow closure plan has been presented to the relevant regulator for review and comment prior to its finalisation.Site ConceptualClosurePlan ClosurePlan CostedClosurePlan

Cadia Valley Gosowong Telfer Cracow Hidden Valley

StatusofclosureprovisioningNewcrest recognises that it has an obligation to restore its mine sites to an agreed condition at the end of the life of mine. Mine rehabilitation costs are provided for at the present value of future expected expenditure when the liability is incurred. Although the ultimate cost to be incurred is uncertain, we have estimated costs based on feasibility and engineering studies using current restoration standards and techniques. When this liability is recognised a corresponding asset is also recognised as part of the development costs of the mine and is amortised across the same useful life.The balance of the provision at 30 June 2010 is $68.8 million ($54.6 million last year).



BlayneyCopperMineNewcrest inherited the closed Blayney Copper Mine from BHP Gold Mines when Newcrest was formed in the early 1990s. The mine is located immediately west of the town of Blayney some 30 km east of our Cadia Valley operation. The site has a long history of mining, commencing in the early 1880s. The mine is situated on a hill west of Blayney, overlooking the surrounding valley. It is easily identified, with a large scar of red soil clearly visible from a distance.Inspections are carried out across the Blayney site on a monthly basis. Observations made include previous capping works which occurred in 2007, weed management, contaminated stockpile stability and the condition of heritage relics. There have been no issues identified on any site visit. Weed spraying occurs regularly and is included the CVO weed management program.A meeting with DECC representatives was carried out at the Blayney site early July 2009 to discuss future rehabilitation works. A verbal agreement was reached as to the disposal of contaminated soil stockpiles on‑site. The area recommended for disposal is the old rail cutting where it is proposed the contaminated soil will be deposited and encapsulated. Further discussions are to be held with Blayney Council and DII‑Minerals. Consultants/contractors are currently being considered to carry out rehabilitation on the abandoned Copper Mine site. Heritage advice is required for the management of heritage relics during the rehabilitation process. The Heritage Office will be notified of these works.DevelopmentofMineClosureCriteriaCVOCVO continued a project aimed at developing rigorous, repeatable and meaningful closure criteria for rehabilitation works at CVO. The criteria have been developed based on a range of current proposed final land forms including:

Pasture (grazing);• Woodland (conservation);• Forest (conservation); and• Riparian areas (conservation).•

These final landforms are generally consistent with commitments made in the respective EIS’s, consent conditions, Mine Operations Plans and the Mine Closure Plan. It is intended that the primary criteria are used as ‘sign off commitments’ with regulators while secondary criteria are used to provide additional information and progress data.

The project aims to establish clearly defined, repeatable and consistent methodologies for monitoring changes in various aspects of ecosystem function, succession and long‑term sustainability. This process includes:1 Identifying a range of parameters for measurement that

provide simple, informative and reliable information that when comparing between reference and rehabilitation sites can show positive recovery trends or rapid detection of rehabilitation failure;

2 Selecting a range of relevant reference sites to compare and track the progress and inherent ecosystem function of rehabilitation areas. Reference sites must reflect the desired final land use, biodiversity targets, local community expectations and the pre‑mining environment;

3 Undertaking the monitoring of reference sites;4 Select a range of representative rehabilitation sites

for monitoring;5 Undertake monitoring of rehabilitation sites; and6 Compare the data of rehabilitation sites to corresponding

reference sites – based on the same final land use.During the current year a review of mine closure criteria was undertaken with the re‑sampling of 9 reference sites. Based on the sampling there were some minor changes to the closure criteria. The key indicators measured in the reference sites form both an upper and lower limit value by which rehabilitation sites should equal or exceed. Shaded boxes represent 21 ‘primary closure criteria’ which would be ‘signed off’ as agreed closure milestones. The remaining indicators represent secondary criteria and are used to provide additional information, progress data and may highlight areas requiring additional efforts/inputs. During 2011 the critical review of the closure criteria methodology and reference sites will continue with the ongoing assessment of the number and type of reference sites, classification of final land‑use categories, determination of soil reference parameters and indicators for fauna habitation/suitability.


SOCIAL PERfORmANCE INdICATORS

managEmEnt aPPrOaCh

POLICY

Newcrest has a Safety and Health Policy, which can be found on our website.Newcrest has a number of employment related policies. They include:

Diversity Policy• ;Employee Relations Policy• ;High Performance Policy• ; andInternational Employees Policy• .

Newcrest does not have a specific Human Rights Policy, but this issue is covered under our Code of Conduct Policy (which can be found on our website).Newcrest has a Communities Policy which can be found on our website. We do not have a specific Indigenous policy as we do not discriminate between the various sub‑groups within our broad community.Newcrest does not have a specific Public Affairs Policy, but this issue is covered under our Code of Conduct Policy (which can be found on our website).The Code of Conduct addresses privacy matters. We comply with privacy laws by ensuring the appropriate and lawful collection, use and storage of personal information.

MANAGEMENT

OrganisationalresponsibilityAll of Newcrest’s employees and contractors have an obligation to comply with occupational health and safety laws and regulations, and to comply with the Company’s health and safety policy, standards and specific statutory obligations.The Group has a General Manager Human Resources who reports to the Executive General Manager – People and Communication. Whilst each site has its own Human Resource professionals, the function is centrally led across the group to ensure consistency in application of policy and standards.The Company’s senior safety and health professional is the Head of Safety and he is responsible for the Group’s overall health and safety performance, for setting appropriate health and safety standards and objectives, and for advising senior management and the Board on health and safety matters. Each operating site has one or more health and safety professionals to manage site health and safety issues and to advise site management on health and safety matters.Newcrest has a Board Committee, the Safety, Health and Environmental Committee, which monitors the Company’s health and safety management practices and ensures that the Company has appropriate policies in place. The Committee met four times in 2010.Community and Human Rights responsibilities are coordinated by the Head of Environment and the Manager of Social Responsibility with each operating site employing professionals in a range of disciplines depending on their individual circumstances.The relationship with our customers is managed by the Company’s Finance Director and, reporting to him, a General Manager Concentrate Marketing. Our principle customers are the smelters who take our copper‑in‑concentrate.

GoalsandperformanceNewcrest continued its safety theme of Target Zero; however, the emphasis on achieving this was through the concept of No Accidents Today. Reinforcing the concept that personnel should consider the activities they are about to do or are doing and manage the risks within these activities to prevent incident or injury. This applies equally to all employees and contractors irrespective of their position or title.In addition and in support of the safety theme above a number of key activities and initiatives were implemented throughout 2009 and will be continued into 2010 and beyond. These include:

Complete overhaul and re‑vamp of the Safety Management • System (SMS), aimed at achieving greater standardisation across the organisation while improving the overall safety culture.Development of an improved safety data management system • with online capability to improve safety reporting and analysis.Introduction of ‘Leading with Safety’ programs across multiple • sites to better inform and educate managers and supervisors.Introduction of a peer observation and monitoring system • across multiple sites to advance the behavioural safety aspects of Newcrest.Introduction of a safety lottery to further promote and encourage • safe behaviour within the organisation.Improved incident investigation training with greater focus • on the identification of systemic failures, communication of lessons learnt and ongoing systems improvement.Specific focus on health issues to identify key risks and • implement formal management and control frameworks.

Despite the economic uncertainty generated by the global financial crisis, the demand for skilled labour in the Australian resources sector remained steady throughout the year and is expected to continue for a number of years driven by major resource development projects. Attracting and retaining capable employees will continue to be a key challenge for the Company’s People Strategy. Developing Newcrest’s employees, promoting from within and providing challenging opportunities will continue to be hallmarks of the Company’s approach.We recognise and respect the right of indigenous peoples to be consulted on matters which potentially impact on their land, culture and livelihoods.To support these objectives we have developed guidelines and procedures to manage our relationships with indigenous communities. The key documents which underpin these procedures include:

cultural heritage management plans;• cultural awareness policies and programs;• various access and land use agreements; and• heritage management agreements.•



TrainingandawarenessThe Company is committed to the ongoing development of its employees and has training and development programs aimed at ensuring the provision of relevant training to all employees. Training provided covers safety, technical, management and interpersonal skills and is both in‑house and externally provided. Where possible, externally accredited training is provided.Each of our operations has a comprehensive site induction program for new employees, contractors and visitors. The content of the induction will vary depending on the time the person will spend on‑site, and the nature of their responsibilities. These programs have a strong emphasis on safety in keeping with our commitment to a safe, injury‑free work place.

CONTEXT

Newcrest is focused on maintaining a safe environment for its employees, operating and developing mines in line with good environmental practices and embracing a strong sense of commitment to local communities around its operations. Newcrest has established programs to achieve continuous improvement of its Safety and Health and Environment and Community performance. These programs fall into three broad categories:

Organisational Initiatives intended to strengthen Newcrest’s • focus, strategic intent and follow through on HSEC matters;System Initiatives intended to ensure Newcrest has all of the • controls in place to manage HSEC risks; andBehavioural initiatives intended to ensure Newcrest’s • employees and contractors genuinely understand and are prepared to strive for improved outcomes in these areas.

The anticipated ongoing tightness of the skilled labour market in Australia, particularly in the resources sector driven by forecast major resource development projects, requires that Newcrest continues to develop and implement its People Strategy. The Strategy is founded on two key principles:

building an organisation capable of implementing and delivering • the business strategy based on leadership capability, structure, critical people‑based systems and required technical skills; andhaving the talent needed for the business, which is based on • attracting, developing, retaining and renewing capability.

Newcrest has made significant progress in implementing key elements of the Strategy and, in particular, strengthening its ability to attract, retain and develop its people. The overall effectiveness of Newcrest’s People Strategy is dependent upon the Company’s ability to establish and maintain a high level of engagement with its workforce.We do not produce any products which are traded directly with the general public. Our products are gold bullion and copper concentrate.

laBOur PraCtiCES anD DECEnt WOrk

EMPLOYMENT

la1 WorkforceThe overall effectiveness of Newcrest’s people strategy is dependent upon the Company’s ability to maintain a high level of engagement with its workforce by providing opportunities for the full potential of the individuals to be realised in contributing to the growth of the business and their own growth.WorkforcestatisticsDuring the year Newcrest’s workforce increased significantly. At 30 June 2010, Newcrest had 4,048 direct employees and 3,639 contractors.

Employment(No.)

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The 2010 year has seen a stability of overall employee turnover (11 percent in June 2010 to 11 percent in June 2009) reflecting in part the uncertain economic conditions during the year generated by the global financial crisis.PeoplestrategyIn late 2006, Newcrest revealed its Vision which is to be the Miner of Choice. Newcrest’s Values (see below) will guide the behaviour of its workforce in realising that Vision.

We work together.• We care about people.• We act with integrity and honesty.• We value innovation and problem solving.• We seek high performance in ourselves and others.•

The Newcrest values, which originated at Cadia, were further developed by a group of Newcrest people, who developed enabling behaviours underpinning each value. These values and behaviours form part of an organisation wide workshop which commenced in 2008, the purpose of which is to create strong workforce engagement and participation in achievement of the business strategy. Innovation, collaboration and the competencies to tackle business improvement effectively are equally as important, which will also form part of the workshop.



Newcrest’s people framework is being reviewed to ensure that there is close alignment with the vision of being the ‘Miner of Choice’ and also with the key elements of the business strategy.There are a number of key planks to the people strategy including further developing core competencies across the entire workforce and building capabilities to innovate. While attracting and retaining talent in Newcrest is a key consideration, a number of new initiatives have been introduced to support this drive. An example of this is the introduction of the 2010 Newcrest Retention Program which is a tailored limited life retention program applying across all areas of the Company.EmCosNewcrest established the EmCos (Participation and Safety Employee Committees) in 2009 and it has been established across all Newcrest sites to deliver the results of 2009 Newcrest Employee Engagement Survey and importantly to gather Newcrest employee’s feedback to make Newcrest an even better place to work. EmCos is made up of a chairperson, employee representatives and sponsor, meeting on a quarterly basis. Employees can either approach an EmCos representative or initiatives can be emailed via the internal portal. The most recent initiative was the opportunity for Newcrest employees in Australia to purchase Toyota vehicles at ‘fleet discount’ not normally available on privately purchased vehicles. This suggestion was made by an employee and this project was followed through successfully.Creating our Future 2Creating Our Future (COF) was a major initiative implemented throughout Newcrest. Over the last 2 years we have shifted from CoF 1 to the CoF 2 program. It has provided employees with an opportunity to learn about Newcrest’s direction and vision to be ‘Miner of Choice’, to understand how each employee can contribute to Newcrest and to have the opportunity to network with other people from different sites. The purpose of the 2 day workshop is to continue the journey by reinforcing the principles from Creating Our Future workshop and expand the understanding of the business so that we can build tomorrow today. Creating Our Future 2 workshops began in September 2008 and will conclude in 2013, 1,434 contractors and employees attending those workshops across numerous sites.Graduate ProgramThe Newcrest Graduate Program has continued to attract a high number of applications with 3,163 received in 2010 for the 2011 intake. Diversity amongst the graduate and vacation student group has broadened through this time including mature age, gender, and culturally diverse students continuing to join the programs. Newcrest’s two year Graduate Program provides graduates with a combination of on‑the‑job experience, formal training and tailored support, Newcrest continues to enhance its graduate development offering, including annual development workshop, rotation to both onshore and offshore locations, and the graduate committee.

ImplementingNewcrest’speopleframeworkThe following initiatives supported the implementation of the framework during the year:

Continuing to roll out key elements of the Newcrest Leadership • Program via delivery of front‑line leadership programs to Supervisors across the business. Participants in the front‑line leadership programs work towards achieving a nationally accredited Certificate IV qualification in Front‑Line Management. Newcrest has tailored the program to locate learning in the workplace and to utilise participants actual work to create learning and assessment of competence.

Introduction of S• uperintendent course to 91 personnel. Superintendents play a critical role in ensuring strong alignment between Newcrest’s business direction and operational performance. A key feature of the Superintendent’s role is the building of a productive workplace culture as a means to facilitate high performance teams and of individuals. The Superintendent Program builds upon the foundation skills acquired through the Supervisor level. Frontline Management Program (FLMP). As a residential intensive program, the Superintendent Program requires participants to work across sites, across cultures, across functions and across technical and professional disciplines. In this way, the level of challenge, learning and networking, along with the building of Superintendent peer group cohesion, is intensified.The redesigned Work Performance System has been further • embedded as an online tool for improving performance through work planning and feedback.HavingtherightpeopleEmploying people with the appropriate talent and skill sets within the current labour market has proved challenging. Meeting this challenge has focussed close attention on retention and recruitment. Additional actions taken include:

implementing a systematic approach to identifying and investing • in the Company’s talent;ensuring remuneration, working conditions and career • development and opportunities are attractive and competitive, and that Newcrest’s employees are the Company’s best advocates;continuing Newcrest’s graduate program;• continuing a scholarship program and vacation employment • for university students in the third year of their degree;Cadia Valley ‘Cadia Careers Day’ was run again this year, • providing buses to bring local secondary students to view Cadia trade work areascontinuing to operate an apprenticeship program at Cadia • Valley; andan employee retention program was implemented in early 2007 • with the aim, in conjunction with other initiatives, to reduce employee turnover in a market where demand for skills is high.



la2 Employee turnoverThere was a significant increase in employment of 1,183 positions over the previous year (40 percent). The 2010 year has seen a trend of stability in regards to overall employee turnover at Newcrest of 11 percent in June 2010 and in June 2009. The stability in workplace turnover reflected the economic conditions during the year and the uncertainty generated by the global financial crisis.AttractionNewcrest has sought to strengthen its position to attract talent by implementing a range of initiatives directed at lifting Newcrest’s brand recognition in the market place including the following:

developing a new Newcrest Careers Website, providing • up to date information to candidates;attendance at a number of key Career, University and Vacation • Fairs across Australia;offering a range of scholarships and support benefits • to potential employees; andparticipating in a number of AuslMM and industry related events • to raise the profile of both the industry and career opportunities.RetentionSteps taken to enhance the effectiveness of Newcrest’s retention strategies included:

the replacement of the Technical Guild structure within the • Company with 6 Communities of Practice, which designed to engender a sense of community within key areas across the business, the Communities will play an important role in knowledge sharing and will contribute to problem solving by harnessing the knowledge, experience and enthusiasm of the community members;maintaining a sustainable and competitive position in • remuneration levels by responding to changes in pay relativities, both across the industry and within specific professional disciplines; andtracking employee turnover trends to identify key talent • risks and improvement opportunities. This included adopting measures that enable the Company to better identify indicators and causes of turnover.

la3 Employee benefitsThe Company provides eligible employees with the following benefits:

salary continuance cover in the event of injury or illness forcing • a prolonged absence from employment;remuneration on the basis of Total Employment Cost, which • provides employees with the flexibility to choose how they allocate this between a number of options;salary at Risk for executives and senior managers, which • provides payments contingent on achievement of specified Company and individual performance criteria;operating a combination of long‑ and medium‑term Incentive • plans involving regular grants of shares designed to influence future Company performance, align employee interests with those of shareholders and encourage retention. The grants are subject to performance hurdles and vesting periods;

parental leave that puts Newcrest at the cutting edge for the • resources industry. Newcrest’s parental leave policy provides:

up to 14 weeks paid parental leave for the primary carer;• provision for early return by agreement between Newcrest • and the employee; andup to 52 weeks leave of absence;•

employee Assistance Programs providing advice on addressing • personal issues; andthe Company has a study assistance program which provides • financial support for employees pursuing further education.

LABOUR/MANAGEMENTRELATIONS

la4 representationTradeUnionsThe Company’s Code of Conduct prohibits discrimination based on religious, political or industrial activity or belief. The Company does not maintain records on union membership and, consistent with government legislation, all employees have the right to choose which, if any, union they want to belong to.Australia’s industrial laws are set within the context of Australia’s international obligations on freedom of association through the International Labour Organisation (ILO), the United Nations (UN) and other international agencies. Newcrest complies with all aspects of these laws in every jurisdiction in which it operates.Workerrepresentationindecision-makingThe Company provides for worker representation in decision‑making through a number of formal and informal means, ranging from regular work team meetings to the establishment of committees to address specific issues.

la5 Employee negotiationsProcesses are in place to provide employees with the opportunity to negotiate the terms of their employment both prior to commencement and once employed. In any such negotiations, Newcrest at all times will consider both internal relativities and external market competitiveness.As AWA’s are now unavailable alternative arrangements to provide a sound platform to continue to deal directly with employees have been implemented.

OCCUPATIONALHEALTHANDSAFETY

Newcrest continued its safety theme of Target Zero; however, the emphasis on achieving this was through the concept of No Accidents Today. Reinforcing the concept personnel should consider the activities they are about to do or are doing and manage the risks within these to prevent incident or injury. This applies equally to all employees and contractors irrespective of their position or title.In addition and in support of the safety theme above a number of key activities and initiatives were implemented throughout 2010 and will be continued into 2011 and beyond. These include:

Full implementation of the overhauled Safety Management • System (SMS). Activities to align the ex LGL sites with Newcrest systems will also commence.Further development of an improved safety data management • system ‘Cintellate’, which will be expanded to include community, health, stakeholder management, carbon tracking and hazard management modules.



Introduction of ‘Leading with Safety’ programs across multiple • sites to better inform and educate Managers and Supervisors.Introduction of a peer on peer observation program to replace • the Safe Behaviour Observation program.Improved incident investigation training with greater focus on • the identification of systemic failures, communication of lessons learnt and ongoing systems improvement. Newcrest has taken the decision to adopt the ICAM process for the investigation of all incidents that are classified as level 2 or 3 incidents.Specific focus on health issues to identify key risks and • implement formal management and control frameworks.

The implementation of the Group Hazard Control frameworks from the Company‑wide risk management process at site level continues on a prioritised work plan. Key performance indicators and ‘league’ tables continued across Newcrest during the year. The tables are designed to build a competitive team culture within the business to drive improved safety and health performance and are weighted to emphasise leading or positive performance indicators.The introduction of a peer to peer observation process will further empower the workforce and improve the safety culture across the Group.Through a dedicated resource, Newcrest has taken a Group view of health issues both acute and chronic. This work commenced in late 2008 and will continue into 2011 using a combination of risk and industry based analysis. The focus for 2011 will be the establishment of both management programs to prevent and mitigate health impacts to employees, contractors and the broader community. These programs will include the establishment of control frameworks, operating limits and monitoring, and, as per the broader Newcrest approach to risk management, the focus will be on prevention of issues before a risk is realised.Contractors continue to play an important role at Newcrest and their active involvement in the safety initiative is essential in order to lift overall health and safety performance across the Company. The alignment of safety objectives and commitment to the Target Zero initiative form an integral part of the broader contractual obligations. Contractor involvement is a critical factor in the successful outcome of safety activities. It is not uncommon for Newcrest to have a mentoring role with Contractors; however, at the same time the sharing of information with contractors has lead to systems improvements for both parties. Contractors continue to be fully engaged with all Safety and Health improvement programs.

la6 Joint health and safety committeesOne of Newcrest’s Safety and Health (S&H) Standards covers Involvement and Communication, and embraces the establishment and effective use of S&H Committees. Each site across the Company has S&H Committees, which are made up of both employee and management representatives. In addition to these Committees, a Central Safety and Environment Group has been established with membership of Operational General Managers, Exploration General Managers and Safety, Health, Environment and Community personnel.As part of the ‘Leading with Safety’ program, working groups consisting of 10 to 15 frontline employees are being established in major activity areas on each site. These groups will analyse the outcomes of the new peer on peer observation process and work with management to address the barriers to safe behaviour that the observation process identifies.

la7 Safety statisticsNewcrest has a comprehensive system in place that manages the reporting, recording and investigation of all incidents regardless of whether they involve injury, illness, equipment damage, environmental impact or were a ‘near miss’. This system meets all of the Company’s legislative requirements and is in line with industry ‘leading practice’ which, in turn ensures that all of the requirements of the ILO Code of Practice are met.Similarly, Newcrest has systems in place to ensure that all workers who are injured or contact an occupational disease receive timely and effective treatment and rehabilitation as well as any entitlements to Workers’ Compensation.GroupsafetyperformanceThe impact of Target Zero is reflected in generally improved safety performance for the Company in the 2010 year:

A decrease in • lost time injury frequency rate (LTIFR) from 0.8 to 0.6 Lost Time Injuries per million exposure hours. Despite the decrease and Newcrest comparing favourably with its industry peers for this measure, the continued presence of Lost Time Injuries remains unacceptable to Newcrest; andTotal recordable injury frequency rate (TRIFR) decreased from • 7.0 to 5.8.

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SitesafetyperformanceThe safety statistics (LTIFR and TRIFR) for our individual operations are shown in the table below. LTIFR TRIFR

Site 2010 2009 2010 2009

Cadia Valley 0.83 1.7 10.26 9.0

Cracow 0.0 2.3 7.81 9.0

Gosowong 0.29 0.9 4.06 3.5

Telfer 0.92 1.8 8.89 17.8

Exploration 0.0 0.0 0.0 3.7

MMJV 0.52 0.14 2.75 2.39

TotalNewcrest 0.62 0.8 5.78 7.0

The ‘Total Newcrest’ figure includes safety statistics relating to the Newcrest Offices.



la8 health issues Policies on hiV/aiDSDuring 2011, it is planned to finalise our controls around infectious disease management, which will include awareness and prevention programs for HIV along with other STDs. This is particularly relevant in PNG and African operations.MalariaDuring 2010, independent review of malaria incidence and control strategies was conducted within sites and also in local communities. Where improvements to site malaria control programs have been recommended, these have been included in site action plans. Recommendations regards broader based community programs will be part of the business planning process for 2011.

la9 agreements with trade unions covering health and safetyNewcrest complies with all legislative requirements on occupational health and safety in every jurisdiction in which we operate. In many jurisdictions, these requirements provide rights of entry by unions in respect of safety matters.In line with both Newcrest’s legislative requirements and current industrial relations arrangements, there are no formal agreements with trade unions or other employee representative groups covering safety and health.

mm12 Emergency preparednessCorporatecrisismanagementplanNewcrest has developed and maintained a Corporate Crisis Management Plan. This Plan identifies the steps involved in managing a crisis, and is periodically tested to ensure its currency and applicability. A separate document, the Corporate Crisis Management & Recovery Contacts Directory identifies the key members of the Corporate Crisis Management Team and their alternates.OperationscrisismanagementplanEach operation maintains an Emergency Management Plan which identifies potential emergency situations, and details a planned response. Elements of the Plan are periodically tested to ensure that the response is appropriate. The links between the site Emergency Management Plan and the Corporate Crisis Management Plan are also tested periodically.

mm13 new cases of occupational diseaseNewcrest is committed to identifying potential areas of occupational disease through risk assessment. By understanding the risks, and implementing comprehensive monitoring programs, the threat of occupational disease is kept to a minimum.Incidents of occupational disease are included in the overall Group safety incident statistics. Should an incident of occupational disease be reported, it would be investigated to ensure that the circumstances were fully understood, steps would be taken to prevent additional occurrences of the incident (including alerting other operations to the potential risk) and a rehabilitation plan developed to manage the reported incident.

TRAININGANDEDUCATION

la10 Employee trainingNewcrest also invests heavily in the development and training of employees via internally delivered training programs, both trainer‑led and on‑line, and most significantly, the provision of operator and maintenance skills training and assessment conducted on the job. Typically, the trainer‑led or on‑line programs would include all induction and core safety programs, and the on‑the‑job training would include training and assessment in the operation or maintenance of all equipment and processes in the open cut, underground and ore processing operations, including the use of simulator technology for training and assessing truck and shovel operators. The major training initiative undertaken across the whole organisation over the year was the ‘Creating our Future 2’ workshops, which are discussed below.

la11 Policies for skills management for lifelong learningTraining and development forms an important part of the Company’s Work Performance and Career Development Systems. In annual formal performance planning meetings training issues are discussed and needs identified.CVOCadia Valley offers two tertiary education scholarships every year to local students wishing to study one of the many mining industry related disciplines. The scholarships are to the value of $7,800 per annum. In addition, Cadia Valley offers scholarship recipients the opportunity to undertake vacation work with us during the term of their study. The scholarships provide an opportunity for Cadia Valley to share the benefits of our mining operations with the local community – and to encourage the best local people into our industry.In 2010, CVO again departed from past practice and awarded nine tertiary scholarships to local students, CVO currently supports 10 scholarship awardees.Minerals Education Bursary SchemeIn conjunction with the NSW Minerals Council, Cadia Valley participates in a Minerals Industry Bursary Scheme (MEBS) which aims to encourage local senior secondary students towards minerals related post school courses and eventually, careers within the mining industry.In 2010, Cadia Valley awarded twenty three bursaries to Year 11 and 12 students from schools in Orange and surrounding areas. The bursary‑holders are each allocated a mentor from the Cadia Valley workforce and are encouraged to participate in a number of mining industry related activities throughout the year.



CracowCracow’s Indigenous Land Use Agreement provides a number of scholarships for Aboriginal students attending High School. The aim of the scholarships is to encourage students to graduate from Grade 12 and where possible continue to tertiary studies. In the 2010 year, a further eleven awards were made. Each year, an award of a laptop computer is made to the student attaining high achievement in the areas of sporting, academic or good behavioural results. Cracow will continue to support this program in recognition of the importance of encouraging youth for their future development.Cadetships were introduced in 2010, with three awarded to students undertaking tertiary studies. Cracow will continue this program each year in recognition of the importance of supporting our Professional Young Adults.TelferTelfer has also played a role in influencing healthy lifestyles and health programs at the neighbouring indigenous communities. Health programs sponsored by Telfer include:

Healthy Lifestyle program: in conjunction with the University • of Western Australia, Telfer conducts a healthy lifestyle program in four indigenous communities aimed primarily at school children. The program aims to improve awareness of, and increase in, physical activity;Dialysis program: Following a discussion in 2006 to assist the • Martu a Respite Dialysis Clinic is up and running in Jigalong, Telfer Community Relations facilitated the accumulation of the necessary funds for the development of the clinic and the ongoing support program; andAt the initiation of Telfer Community Relations, the community • Healthy Lifestyle Program is being further developed by a joint committee involving the Martu, UWA, Pilbara Population Health, and Department of Sport and Recreation into a ‘whole of community’ program. Following the successful trial of this program in two communities – Punmu and Jigalong – in 2008, the program has been extended until 2012.ProgramstosupporttheemployabilityofemployeesDuring 2010, 75 percent of positions have been filled internally.Leadership programFront line Management Development programs have been completed across the company in the past year.‘Creating Our Futures 2’ workshopsA major initiative being implemented throughout Newcrest is the ‘Creating Our Future 2’ workshop program.The purpose of the 2 day workshops is to build capability within our people, to drive performance and to further develop our vision to be the Miner of Choice. Key themes include enhancing the leadership capacity in everyone in Newcrest and creating an environment where everyone can make a contribution.

The workshop content includes:Business context – our Vision, strategy, business model, • value chain and the global environment.Newcrest Values and enabling behaviours – with an emphasis • on collaboration, innovation, acknowledging differences, new ideas, being data‑driven, increased accountability and shared leadership.Innovation tools – IADRI (Intent, Approach, Deployment, • Review, Improve), idea generation, brainstorming, Communities of Practice, Lean/Six Sigma and learning and development within Newcrest.Competencies – delivering business results through • an awareness and basic understanding of Asset, Risk, Change and Project Management.

Every Newcrest employee and many of our contractors will participate in the workshops, to be held at Telfer, Cadia and Gosowong. The workshop is interactive, combining both practical and theory‑based activities.Telfer employment trainingEmployment opportunities for local Aboriginal people were made available through the following means:

a skills register: included community visits, interviews to • identify skills and training needs, preparation of resumes and trainee selection;employment: both Telfer and its contractors participate in the • Newcrest Indigenous Employment program. The Telfer project currently employs 50 indigenous people, 30 of whom are Martu;employee support: a support service is available to indigenous • employees at Telfer. This includes mentors, an on‑site drop in centre, counselling, visits to families to explain workers responsibilities, workers social gatherings, guest speakers and guidance with personal concerns (e.g. finance, savings) and fitness and health; andthe Telfer gold mine recently celebrated the first graduates to • complete a new six‑month full‑time on‑site Certificate 1 course in Resources and Infrastructure Operations developed in partnership with the Pundulmurra campus of Pilbara TAFE. Telfer’s Community Relations Superintendent, Leon van Erp, said the tailor‑made course was designed to give the trainees, young Indigenous students from Punmu and Warralong, the opportunity to live and work at the gold mine. ‘We are extremely proud of them and what they have achieved under the guidance of a highly‑credentialed course coordinator in Bruce Keane,’ Leon said. ‘These youngsters didn’t get an easy ride to their Certificate. They undertook study and hands‑on practical training in 12‑hour shifts on a two‑weeks‑on, two‑weeks off basis,’ he said. Newcrest also provided fly in and fly out and drive in and drive out facilities, so that the students, who live some 300 kilometres from the mine, can attend work and go home on their breaks. The course comprised education and training in units designed to prepare the participants for work at Telfer, including small plant operation, light vehicle driver training, numeracy and literacy; activities in laundry, cleaning, housekeeping, baggage handling, gardening; and buildings, grounds and road maintenance. Pilbara TAFE’s Pundulmurra campus principal, Alan Scott, who oversaw the design and supervision of the course, said that Newcrest had made a significant contribution in training and employing Indigenous people for many years and should be particularly commended for their track record in training with the Martu communities.



Cracow traineeshipsUnder the Indigenous Land Use Agreement with the Wulli Wulli, Cracow offers positions for 3 trainees each year. The trainees complete their Traineeships and gain a TAFE Certificate, which enables them to seek employment elsewhere. As trainees complete their course they are replaced with new trainees. The number of Aboriginal employees at Cracow (including trainees) is approximately 10 percent of the total workforce.HolistichealthandsafetyapproachNewcrest has implemented several home safety initiatives. These include a formal Wellness Program, implemented at Cadia Valley Telfer and Cracow, and the distribution of home safety bulletins (driver fatigue and driveway safety). At Cracow, home safety kits were issued to site personnel to take home and use; they included gloves, safety glasses, dust masks and electrical isolation tags.

la12 Performance reviewOur business success, and therefore that of our stakeholders, requires that we always have the right people in the right roles doing the right work. This in turn requires that every Newcrest manager provides a productive work environment that encourages high performance by all of our people.The Work Performance System has been designed to assist everybody in doing the right work in the right way. Integral to the functioning of the Work Performance System is the requirement for structured one‑on‑one sessions between managers and their employees. These sessions provide an ideal opportunity for feedback from employees.Newcrest believes that our employees can expect the organisation to provide clarity about answers to four key questions:

Where are we going?• What is my job?• How am I doing?• What is my future?•

In Newcrest, providing clarity around these questions is a shared accountability between the manager and his/her manager (the manager‑one‑removed), and where appropriate the Community of Practice Leader.

The Work Performance System has been designed to provide a framework for both the setting of goals and the provision of feedback in relation to the achievement or otherwise of those goals. Importantly the Work Performance System also provides the forum for a discussion on employee development needs and the setting of a plan to undertake that development.

DIVERSITYANDEQUALOPPORTUNITY

la13 DiversityCompositionofcorporategovernancebodiesThe following table shows our key corporate governance bodies and the male/female composition of each at 30 June 2010.Body Male Female

Board of Directors 8 0

Audit and Risk Committee of the Board 4 0

Safety, Health and Environmental Committee of the Board 3 0

EqualopportunitypolicyWorkforce diversityThe Company places a high value on having a diverse workforce. Its recruitment and employment policies and processes promote equal employment opportunity on the basis of merit, without discrimination.Our Code of Conduct Policy applies to all employees and all people who work with the Company, including contractors. It covers all work‑related activities, and prohibits discrimination on a range of attributes as defined by the Government’s anti‑discrimination legislation.In promoting a diverse workforce, the Company will participate in programs to provide indigenous people and others, from within the local communities in which it operates, with vocation training and employment opportunities.Telfer Operations has successfully introduced a ‘Telfer Indigenous Training Program’, which consists of 26 weeks of training and on successful completion a Certificate 1 in Mining & Infrastructure is awarded. During the reporting period, 23 Indigenous trainees commenced the program, 11 of whom were female.The Company is committed to developing and implementing equal opportunity for women in the workplace programs in accordance with the Equal Opportunity for Women in the Workplace Act 1999 (Cth). The programs involve the development of a number of objectives which are monitored and evaluated and form an important part of equipping and maintaining an optimum workforce. The Company complies with the annual reporting requirements to the Equal Opportunity for Women in the Workplace Agency (www.eowa.gov.au).The Company has continued its program of progressively providing all managers and employees with training in equal opportunity and related issues.



Complaint procedurePeople who feel they have been subject to prohibited discrimination, harassment, victimisation, bullying or occupational violence are encouraged to raise their concerns directly with the person involved, and request the relevant conduct to stop.If this does not resolve the issue or if the person does not feel comfortable with speaking directly to the person, they should raise the matter as soon as possible with either their manager, their manager once removed, or their Human Resources representative.All complaints will be investigated promptly, confidentially and fairly in accordance with the Company’s Code of Conduct.ComplianceThere have been no cases of discrimination reported during the past year.WorkforcediversityThe Newcrest workplace profile (for the period 1 April 2009 to 31 March 2010 – EOWA Reporting period) shows that:

Women comprise 13.95 percent (260 employees) of the • total workforce.Women represent just on 10 percent of all employees at mine • sites and minerals processing operations, which remains above the industry average participation rate of 3 percent. Individually, those participation rates are the three onshore sites are: Telfer 13 percent, Cadia Valley 7 percent and Cracow 14 percent.The highest proportion of women is in the Technicians, • Professionals & Clerical roles (15.5 percent), this percentage has decreased by 0.3 percent compared to the 2009 periodThere still remains a disproportionate percentage of women • in managerial roles (includes General Managers and Manager) at 2.6 percent and 11.9 percent respectively, compared with men at 97.4 percent and 88.1 percent for the same period.In regards to casual employment, women represent 60 percent, • as compared to men at 40 percent. The percentage of women working in casual employment arrangement remains the same at 60 percent across both reporting periods.Part‑time employment comprises of 1 percent or 19 employees • of the total workforce. Of this group of employees, 79 percent (15 of the total 19 employees) who work on a part‑time basis are women. This represents a small increase of 0.22 percent of women working in a part‑time capacity in comparison to the 2009 report.

A more detailed breakdown of our workforce by Work Level and Gender is included in our annual report to the Equal Opportunity for women in the Workplace Agency (EOWA).

la14 remunerationA full outline of remuneration is contained in the Directors’ Report in the Annual Report.HumanResourcesandRemunerationCommitteeThe Board operates a Human Resources and Remuneration standing Committee. The role of this Committee is to review, advise and formulate recommendations to the Board in relation to matters within its Charter, to refer these to the Board for determination and to oversee implementation by management of the Board’s decisions on remuneration and related matters.The Human Resources and Remuneration Committee has responsibility for approving and overseeing the implementation of the Group’s human resources and remuneration policies and practices. Its role also includes wider employee and human resources issues, including recruitment, retention, the Group’s behavioural and cultural framework and performance management practices.The key duties and responsibilities of the Board are to consider and make decisions in relation to:

the oversight of organisational design and human capability • at Newcrest commensurate with its strategic goals;the behavioural and cultural framework and practices of • the Group;the remuneration framework for all employees, including, • in particular, Key Management Personnel, Executive Directors and Non‑Executive Directors;the remuneration levels for Directors, Executive Directors • and Key Management Personnel and contract terms, incentive arrangements and retirement and termination entitlements for Executive Directors and Key Management Personnel;the implementation and administration of major components • of the Group’s remuneration strategy, such as superannuation, share plans and incentive and bonus payments; andperformance management practices and outcomes.• RatioofmaletofemaleremunerationThe average annual salary for women employed by the Company was $97,744 compared with $122,423 for men. This ratio is affected by the types of roles which women are employed relative to men and the low representation of women in senior levels of the Company.


Social Performance indicatorS

Human RigHts

INVESTMENT AND PROCUREMENT PRACTICES

HR1 Human rights in investment agreements‘Indigenous communities, peoples and nations are those which, having a historical continuity with pre-invasion and pre-colonial societies that developed on their territories, consider themselves distinct from other sectors of the societies now prevailing on those territories, or parts of them. They form at present non-dominant sectors of society and are determined to preserve, develop and transmit to future generations their ancestral territories and their ethnic identity, as the basis of their continued existence as peoples, in accordance with their own cultural patterns, social institutions and legal system.’United Nations ‘The Concept of Indigenous peoples’ Workshop 19–21 January 2004On the basis of this definition, it is only Newcrest’s Australian operations where issues of specific Indigenous rights arise. Community relation issues with regards to Indonesia and Papua New Guinea operations are reported elsewhere in this report.TelferTelfer has 3 main agreements with the local Martu people:1 infrastructure corridor agreement;2 community benefits agreement; and3 an MOU to negotiate a land use agreement all of which

underpin Telfer’s commitment to indigenous community relations.

These agreements have now in fact expired; however, all benefits continue to be paid out to the traditional owners of the land in accordance with their terms. Since they were signed into effect, the Martu people have had a final determination of their Native Title claim over the land where Newcrest holds its leases for Telfer.In light of this, Newcrest has agreed with the Martu people that an Indigenous Land Use Agreement (ILUA) should be negotiated between both parties to consolidate the commitments and undertakings of the previous agreements into one life-of-operation agreement that recognises the Native Title of the Martu people over the land on which Newcrest is operating and provide the Company with security of its social tenure.A formal process of negotiation has been delayed while the Western Desert Aboriginal Lands Corporation (WDLAC), which is the body corporate representing all of the Martu people, holds its Annual General Meeting and appoints a new board of Directors. The negotiations are planned for 2011.

CracowAn Indigenous Land Use Agreement was negotiated between Newcrest and the representatives of the Wulli Wulli and Iman peoples. The claim of the Iman people has subsequently been dismissed by the Native Title Commission and Newcrest now has an ILUA with the Wulli Wulli people.There have been two significant events that have taken place in relation to the Wulli Wulli Native Title claim in relation to the Cracow project. The new applicant group signed a deed in relation to the Cracow project in the reporting year. The combination of the Wulli Wulli and the Djatnu-Nde and Jangarie claims must move along to complete with federal government orders.The federal government recently ordered that there be an authorisation meeting for each of the Wulli Wulli and Djatnu Nde and the Jangarie Jangarie claim groups by October 2010. The purpose of the meetings is for the groups to decide whether to combine and lodge a new combined claim. If the claims are not combined by the next directions hearing in late 2010, the court will then issue a notice to show cause why the claims should not be dismissed.Commitments under this agreement include a Cultural Heritage Management Plan, monetary compensation for use of land, traineeships, employment consideration on an equal opportunity basis, cultural awareness training and business opportunities as appropriate.The ILUA contains provision for regular (quarterly) meetings to review compliance and these meetings have been held regularly with no issues of significance having been raised during the year.GosowongSince its inception in 1999, the Gosowong Special Projects Group has been committed to the establishment of the companies Community Development programs within the then two districts of Kao and Malifut. The initial thrust of the companies programs was to assist the local villagers to develop sustainable businesses and upgrade essential infrastructure.Since 2007, the project has committed to a target of 1 percent of revenue under what is now known as the Corporate Social Responsibility Program (CSR). This expanded program allocates funds across five sub districts and 81 villages. Expenditure priorities and projects are determined by a three person committee in each village and the project CSR team facilitates implementation.It has been agreed by all the beneficiary communities that Sustainable Economic projects are the main priority and a target that 80 percent of the projects are to be sustainable in nature by 2012 has been set.ExplorationDeveloping and maintaining strong, positive relationships with communities where exploration activities are planned and occur is an essential part of the exploration process. Newcrest understands that in order to conduct exploration and develop a mine, it must obtain approval and a social license to operate from the local community and other key stakeholders. The Company always seeks to interact with the local community when conducting exploration activities so as to inform it of the planned exploration, and develop understanding, mutual respect and community support for its work. Newcrest recognises that relationships established in the very early stages can make or break the community relationships essential to project success.



hr2 Screening of suppliers and contractorsSystems are in place to ensure all contractors are aware of the Company’s Values via the Code of Conduct.Newcrest requires that all of its contractors and consultants will minimise their community, environmental, and health and safety impacts, and will comply with Newcrest’s performance standards at all times. Contractors and consultants undergo an induction before entering sites which includes social and environmental performance requirements. Where appropriate, the social and environmental performance of contractors and consultants is included in Newcrest’s consolidated data.

hr3 Employee training on human rightsThe Company has a Code of Conduct addressing, amongst other things, human rights, any related complaints or concerns.Training for employees and managers on the Company’s Code of Conduct and Employee Relations Policy has been conducted and is included in the induction process for all new employees and contractors.Newcrest’s Values form the basis for guiding actions and behaviours by the Company, its employees and contractors, including human rights issues. The Newcrest Values are:

We care about people.• We act with integrity and honesty.• We seek high performance in ourselves and others.• We work together.• We value innovation and problem solving.•

The Company’s Communities Policy describes the principles which guide our relationships with the communities in which we operate. The Company participates in programs to provide indigenous people and local community members with vocation training and employment opportunities (see Section LA11). Newcrest has appointed a corporate Manager Community Relations and site Community Relations specialists as part of its implementation of the Communities Policy.In compliance with Australian privacy regulations, the Newcrest Information Technology Security Policy ensures the Company engages only in the appropriate and lawful collection, use, disclosure, correction and storage of personal information. This policy applies to prospective employees, employees, contractors and consultants.CracowAt Cracow, human rights and indigenous awareness has been addressed through the Cross Cultural Awareness program. This program was developed as part of the site induction for exploration and development personnel at Cracow. As well as general material on cultural sensitivity, the program spells out responsibilities and obligations, including the need to:

respect the Aboriginal heritage and culture that is associated • with the Cracow Joint Venture Project;ensure that any artefacts are not destroyed and that the • appropriate notification procedure is followed;cooperate with Aboriginal monitors who may be on‑site carrying • out monitoring duties in accordance with the Cultural Heritage Management Plan;

understand that racial discrimination of any kind is a breach • of company policy and Queensland and Australian law; andprotect a number of non‑indigenous heritage sites which have • been identified at the site.TelferFrom a cultural perspective, Telfer supports the Western Desert Land Aboriginal Corporation and Pilbara Native Title Services by sponsoring a heritage officer and other community‑related positions.Cultural awareness programs are also conducted for all employees at Telfer, and training is underway that will enable local Martu people to take a lead role in presenting these courses in the future. These include:

cultural awareness: Telfer conducts Martu Cultural Awareness • presentations for all employees on‑site;cultural support: ‘Back to Country’ expeditions are conducted • for local old people;identification and protection of local sites; and• support for traditional cultural events.•

NON-DISCRIMINATION

hr4 incidents of discriminationNo incidents of discrimination were reported during the year.We are committed to providing all employees with a work environment free of discrimination, harassment, victimisation, bullying and occupational violence.Our Code of Conduct applies to employees and all people who work with the Company, including contractors. It covers all work‑related activities, including work outside business hours, work off‑site and work related functions, even if not held on Company premises.Anyone held to have breached this Policy will be subject to appropriate disciplinary action, which may include dismissal.CoverageThe Code of Conduct covers the following key areas:

anti‑discrimination;• harassment;• bullying;• occupational violence; and victimisation.• WorkforcediversityThe Company places a high value on having a diverse workforce. Its recruitment and employment policies and processes promote equal employment opportunity on the basis of merit, without discrimination.In promoting a diverse workforce the Company will participate in programs to provide indigenous people and others, from within the local communities in which it operates, with vocation training and employment opportunities.The Company is committed to developing and implementing equal opportunity for women in the workplace programs in accordance with the Equal Opportunity for Women in the Workplace Act 1999 (Cth). The programs involve the development of a number of objectives which are monitored and evaluated and form an important part of equipping and maintaining an optimum workforce.



ComplaintprocedurePeople who feel they have been subject to prohibited discrimination, harassment, victimisation, bullying or occupational violence are encouraged to raise their concerns directly with the person involved, to request the relevant conduct to stop.If this does not resolve the issue or if the person does not feel comfortable with speaking directly to the person, they should raise the matter as soon as possible with either their manager, their manager once removed, or their Human Resources representative.All complaints will be investigated promptly, confidentially and fairly in accordance with the Company’s Code of Conduct.In 2008, Newcrest introduced an internal reporting service run by an independent third party service provider, enabling employees and contractors to raise concerns or to report instances of misconduct on an anonymous basis. Reports are refereed to Newcrest management and where appropriate investigated further.ImplementationAll employees and other people covered by this policy must read it and comply with it. They must attend compulsory workplace behaviour training programs as directed by the Company. They are encouraged to raise any concerns about conduct in accordance with the policy. They must keep information about any complaints confidential and not discuss them except to assist the Company resolve a complaint.Managers and supervisors must ensure that employees are aware of their rights and obligations and those complaints of prohibited discrimination, harassment, victimisation, bullying and occupational violence are promptly and fairly investigated and appropriate action taken.

FREEDOMOFASSOCIATION

hr5 right to freedom of association and collective bargainingNo incidents of violations of freedom of association or collective bargaining were reported during the year.The Company’s Code of Conduct prohibits discrimination based on religious, political or industrial activity or belief. Employees have the right to belong to a union of their choice.Australia’s industrial laws are set within the context of Australia’s international obligations on freedom of association through the International Labour Organisation (ILO), United Nations (UN), and other international agencies. Newcrest complies with all aspects of these laws in every jurisdiction in which it operates.

CHILDLABOUR

hr6 incidents of child labourNo incidents of child labour were reported during the year.The Company will not engage in, or condone, any form of child labour.The Company applies employment screening to ensure that under age persons are not recruited to work at it’s operations, in particular the overseas operations. This screening is required because many people from traditional societies do not have formal birth certificates and place a high premium on employment.The Newcrest Code of Conduct sets down 12 standards for appropriate ethical and professional behaviour for employees and Directors. It sets out the fundamental principles which, in combination with Newcrest’s Values, form the basis of, and underpin all of Newcrest’s business relationships.As part of the Code, the employees of Newcrest are committed to respect and observe the laws of the country in which they operate.Australia’s industrial laws are set within the context of Australia’s international obligations on child labour through the ILO, UN, and other international agencies. Newcrest complies with all aspects of these laws in every jurisdiction in which it operates.

FORCEDANDCOMPULSORYLABOUR

hr7 incidents of forced and compulsory labourNo incidents of forced or compulsory labour were reported during the year.The Company will not engage in, or condone, any form of forced and compulsory labour.The Newcrest Code of Conduct sets down 12 standards for appropriate ethical and professional behaviour for employees and Directors. It sets out the fundamental principles which, in combination with Newcrest’s Values, form the basis of, and underpin all of Newcrest’s business relationships.As part of the Code, the employees of Newcrest are committed to respect and observe the laws of the country in which they operate.Australia’s industrial laws are set within the context of Australia’s international obligations on the prevention of forced and compulsory labour through the ILO, UN, and other international agencies. Newcrest complies with all aspects of these laws in every jurisdiction in which it operates.



SECURITYPRACTICES

hr8 human rights training for security personnelSystems are in place to ensure all contractors, including security personnel, are aware of the Company’s Values, Code of Conduct.We seek to ensure that our presence fosters sound relationships and avoids civil conflict wherever we are. We do not condone human rights abuses, and where possible, try to avoid situations that could be interpreted as such.It is a government responsibility to uphold law and order in all jurisdictions in which we operate. Newcrest also makes limited use of private security personnel where it is necessary to protect gold shipments or valuable property.At Gosowong, PTNHM is required to contribute modestly to the upkeep and expenses of the police force whilst on site, as this is a requirement of the Indonesian Government. Notwithstanding this, the command and operation of these police remains solely at the discretion and responsibility of the Indonesian authorities at all times.In Papua New Guinea at Hidden Valley, the Morobe Mining Joint Venture has been required to provide logistical support to Royal Papua New Guinea Constabulary members at the request of the Police Commissioner from time to time.

INDIGENOUSRIGHTS

CS1 indigenous communitiesCadiaValleyA survey conducted for the original Cadia Project approval concluded that ‘given the gross disturbance to the area due to European occupation, mining, grazing and forestry, the likelihood of identifying significant Aboriginal sites in the vicinity of Cadia is severely limited’. Cadia Valley continues to conduct archaeological surveys prior to entering new areas. These surveys involve members of the local Aboriginal people facilitated by suitably qualified archaeologists and anthropologists.GosowongThe main indigenous group in the Gosowong area is the Kao community, which consists of a number of smaller ethnic groups including the Madole, Pagu, Boeng, Sosol and Kao peoples. The second largest group after the Kao community is the Makian ethnics. These people originated from nearby Makian Island, and moved to the Kao Subdistrict in 1988 when the Makian Movement erupted.There is no clear ‘indigenous’ group for the Gosowong area. Many of the ethnic groups have coexisted in the area for a considerable period of time. We consider the people of this area to be our ‘local community’, and more information is given in the Section on Community later in this report.TelferTelfer is situated on the edge of the Great Sandy Desert, which is home to Aboriginal language groups now collectively called the Martu. Telfer’s predominant area of interest is communities within a 3,200 kilometre radius of the mine, the communities of Bidyadanga, Looma and Wangkajungka in the Kimberley and also the towns of Marble Bar, Nullagine and Port Hedland. Aboriginal groups situated between Port Hedland and Telfer are also our key stakeholders, in particular those language groups whose areas are traversed by the gas pipeline.

CracowCracow Gold Mine is located in a historical mining area centred on the community of Cracow in Central Queensland.One Aboriginal Group has an overlapping land claim over the Cracow Mine tenements. They are the Wulli Wulli people, who predominantly live in the nearby towns of Theodore and Eidsvold.

hr9 incidents involving rights of indigenous peopleThere were no significant incidents involving the rights of indigenous people in 2010.

CS2 indigenous agreementsTelferNewcrest has agreed with the Martu people that an Indigenous Land Use Agreement (ILUA) should be negotiated between both parties to consolidate the commitments and undertakings of the previous agreements into one life of operation agreement that recognises the Native Title of the Martu people over the land on which Newcrest is operating.CracowAn Indigenous Land Use Agreement was negotiated between Newcrest and the representatives of the Wulli Wulli and Iman peoples. The claim of the Iman people has subsequently been dismissed by the Native Title Commission and Newcrest now has an ILUA with the Wulli Wulli people.Commitments under this agreement include a Cultural Heritage Management Plan, monetary compensation for use of land, traineeships, employment consideration on an equal opportunity basis, cultural awareness training and business opportunities as appropriate.The ILUA contains provision for regular (quarterly) meetings to review compliance and these meetings have been held regularly with no issues of significance having been raised.GosowongSince its inception in 1999, the Special Projects Group has been committed to the establishment of the company’s Community Development programs within the then two districts of Kao and Malifut. The initial thrust of the company’s programs was to assist the local villagers to develop sustainable businesses and upgrade essential infrastructure.Since 2007 the project has committed to a target of 1 percent of revenue under what is now known as the Corporate Social Responsibility Program (CSR). This expanded program allocates funds across five sub districts and 81 villages. Expenditure priorities and projects are determined by a three person committee in each village and the project CSR team facilitates implementation.It has been agreed by all the beneficiary communities that Sustainable Economic projects are to be the main priority going forward and a target that 80 percent of the projects are to be sustainable in nature by 2012 has been set.



mm11 land rightsLandandcustomaryrightsTelferThe Martu people were granted land rights by the Federal Courts in 2002 through a consent determination. At the time of grant, the area granted was the largest in size in Australia.CracowA Native Title Determination in favour of the Wulli Wulli people was made by the Australian Federal Court on 2000.Subsequent to this decision, an Indigenous Land Use Agreement (ILUA) was negotiated between Newcrest and representatives of the Wulli Wulli and Iman peoples in 2002. In a subsequent decision of the Federal Court, the rights of the Iman people were denied and the Wulli Wulli people are now the recognised land owners for the area in which the Cracow mine is situated.GrievancemechanismsWe have sought to reach mutually beneficial agreements with local indigenous communities wherever we operate. Formal agreements have been put in place at:

Cracow, where the Company and its joint venture partner have • signed an ILUA with the relevant Aboriginal community; andTelfer, where the Corridor Agreement for the gas pipeline • and the Community Agreement and MoU for the mine have technically expired, but are still being recognised whilst arrangements for the negotiation of an ILUA are being made.

All agreements provide substantial opportunity for local indigenous groups to raise issues with us, and for these to be resolved in an appropriate manner.

CS3 aboriginal cultural heritageWe seek to reach mutually beneficial cultural heritage agreements wherever we operate, which requires understanding and respect for Aboriginal cultural heritage. We completed 14 cultural heritage surveys in 2010.ExplorationNewcrest, through a range of cultural heritage agreements, conducts heritage surveys prior to commencing exploration activities. The surveys are usually carried out by a survey team which comprises a small number of Aboriginal representatives, at least one Newcrest representative, and if required, an archaeologist and/or anthropologist. Depending on the survey findings, various exploration activities may need to be relocated or removed from the program to avoid disturbance to important sites.TelferTrained Aboriginal persons conduct archaeological surveys in respect to any land disturbance outside of previously heritage‑surveyed areas and prior to all exploration activities. Surveys are always accompanied by Martu elders (as representatives of the local native title elders) together with Newcrest representatives.

CracowCracow Gold Mine have a Cultural Heritage Management Plan which forms part of the ILUA. This plan sets out the process for carrying out cultural heritage clearance work for both exploration and mining activity.A number of artefacts identified have been collected and are stored in the Keeping Place, and returned to their original location once mining activity has ceased and the land is rehabilitated.The level of cultural heritage clearance work increased to seven surveys conducted during the year reflecting an increase in exploration activity and a proposed new project. Artefacts of flint stones and Berry Vine were located during these clearances.

CS4 Contributions to indigenous communitiesTotal contributions to indigenous communities amounted to $10.913 million in 2010. $2.586 million of this was in the form of direct contributions (donations, infrastructure, services and development activities), and the balance was in the form of indirect contributions under the various development agreements and purchase of indigenous services.EmploymentandtrainingThere are currently 62 indigenous people employed at our operations (51 employees and 11 contractors). Indirect contributions to Aboriginal communities, by way of wages and salaries, are in excess of $4.18 million per annum.TelferAt Telfer, good progress is being made with the employment of Martu and other Indigenous people at Telfer with 50 indigenous people employed on site at Telfer, 30 of whom are Martu.Employment opportunities for local Aboriginal people were made available through the following means:

a skills register: included community visits, interviews to identify • skills and training needs, preparation of resumes and trainee selection;training: Martu training courses were conducted through • Pilbara TAFE. Courses conducted included Hospitality and Cleaning, Plant Machinery Operation, Horticulture/Gardening, Cultural Awareness, Driving and HR licences; andemployee support: a support service is available to indigenous • employees at Telfer. This includes mentoring, an on‑site drop in centre, counselling, visits to families to explain workers’ responsibilities, workers’ social gatherings, guest speakers and guidance with personal concerns (e.g. finance, savings), and fitness and health.

Telfer has many successful Martu employees, working within in most areas around Telfer, ranging from pit technician, warehouse, driving trucks, community relations, cleaning and gardening, and working for the general services contractor Pilbara Logistics.Pilbara Logistics is a general services contractor at Telfer and is a company committed to employing indigenous workers whenever possible. The work undertaken includes the collection of rubbish, management of landfill and hazardous waste (for example, waste oil collection), transport to and from Port Hedland.



CracowUnder the ILUA, Cracow offers placement for 3 trainees, 1 administration traineeship, which is a 1 year program and the Process Technician Traineeships run over an 18 month period. During the past year, 3 trainees completed their Traineeships and each gained a TAFE Certificate, which enables them to seek employment elsewhere. As trainees complete their course, they are replaced with new trainees. The number of Aboriginal employees at Cracow (including trainees) is approximately 10 percent of the total workforce.HealthTelferTelfer on receiving their land rights, the Martu and Newcrest established a Consultative Committee to investigate ways they could cooperate to their mutual benefit. The Martu people asked Telfer to assist them in establishing a dialysis unit program in their homelands to enable people afflicted with renal disease to return home, at least periodically, to spend time with their families, and to fulfill their cultural commitments.In 2009, Telfer has succeeded in providing a dialysis unit for the Martu people of Jigalong, east of Mt Newman in the Great Western Desert. The success of this program was achieved despite a number of obstacles before the service could commence. Together with the Martu Community and in particular the Jigalong Community Inc, Telfer Community Superintendent Leon Van Erp and Fred Ordinski, previously Manager of Technical Services for Dialysis at Royal Perth Hospital and is now Managing Director of Dialysystems Pty Ltd, investigated and managed the total refurbishment and transformation of a Jigalong community house into the Martu Respite Renal Dialysis Centre, complete with the appropriate licences, equipment and procedures.This unit operates for two week sessions and operates four times per year, treating up to seven treatments, this project will operate until 2012 when its future will be reviewed.Indigenous Sporting ProgramTelfer has facilitated over a period of time a number of meetings which have brought together a number of sporting and recreational experts from around the State of Western Australia, Martu community leaders, Western Desert community schools, community coordinators and other organisations within the region, with the aim of developing a cooperative approach to the delivery of sport and recreational programs within local Indigenous communities.The plan has been agreed upon and has been endorsed by the Martu, who are looking forward to having a happier and healthier communities. The next step is for the outcome from the 6 month process is that the Western Desert Sport and Recreation Committee will be formed, comprising Martu leaders from each of the Western Desert communities. The Committee will continue the momentum into the future by providing feedback and working with all supporting health, education, sport and recreational organisations to help guide a newly coordinated program in the most beneficial direction for the Martu and Western Desert.

GosowongUnder the Corporate Social Responsibility program, the project has initiated a number of rural health improvements, which include upgrades to facilities and in several cases the payment of salaries for health workers, and in some cases subsidies to salaries, to ensure government health facilities are staffed and functional.MMJVMMJV funded clinic gives round the clock health care in PNG. The new medical clinic, located in the Morobe Province of Papua New Guinea, now provides emergency, preventative and first aid support to the local area 24 hours per day. In extreme cases, the clinic also provides essential vehicle and helicopter transport services, which is highly valued in the community.The clinic has provided vital preventative medical care, with nearly 400 children vaccinated. The clinic also provides much needed health and wellbeing support to support landowners, MMJV staff and contractors and people from the local communities.EducationTelferDuring the reporting period, support was provided by Telfer for a number of educational pursuits for indigenous locals. Educational support is provided to indigenous communities through:

school visits;• provision of funding for the School to Work Transition Program • at Punmu;the development of school project kits; and scholarships.•

CracowFollowing the implementation of the Cracow Indigenous Land Use Agreement in 2004, Cracow has awarded 66 Secondary School Scholarships to Aboriginal students. In the 2010 year, a further 11 awards were made. Each year, an award of a laptop computer is made to the student attaining high achievement in the areas of sporting, academic or good behavioural results. Cracow will continue to support this program in recognition of the importance of encouraging youth for their future development.Cadetships were introduced in 2010, with 3 awarded to students undertaking tertiary studies. Cracow will continue this program each year in recognition of the importance of supporting our Professional Young Adults.CommunitydevelopmentTelferTelfer also sponsors the Martu in the following areas:Desert Sport Development Program: Martu Sports Council, the annual Punmu Festival and the Western Desert Shield;

the ‘• Kujungkarrini’ a community magazine which is produced by Telfer three times per year. It features the many and varied community activities involving Telfer including updates on Martu training and employment;sponsorships and donations are provided to various • educational, cultural and sporting groups whose work involves the participation of Martu;support for Martu governance and meetings, e.g. the Martu • AGM and funding for various administrative positions, in keeping with the Telfer/Martu agreements;



on‑site training and employment of local Martu;• infrastructure provision and maintenance, e.g. Punmu Sports • complex, desert windmills program, Community Store construction and equipment, airstrip, road and oval maintenance;the provision of fresh fruit and vegetables to local • communities; andthe facilitation of regional meetings for Martu, Police, • teachers and Martu Sports Council.

The remote location of Telfer makes it a resource for emergency support. Community Relations, Security and Emergency Services staff provide emergency repairs, fuel and tyres and food and water to travelling Martu and are often called to assist stranded travellers.Telfer collaboration to develop sport and improve health in the Western DesertA collaboration between Telfer and neighbouring community organisations has led to the Western Desert’s first football and softball leagues, to develop sport and improve the health prospects of the Martu and Pintubi people.Both adults and children play football and softball in the monthly league. The 5 day events are well attended with crowds of up to 1,300. Families and friends travel long distances to take part. Established in February 2010, the league has also attracted the attention of sports scouts and sports development groups.The newly formed Western Desert Sport and Recreational Committee, which organises the leagues, promotes Martu ownership and empowerment. The Committee represents 7 major communities in the region, who, with Telfer’s support, created and developed for the first time a committee to manage sports development and events.CracowBecause the nearest Traditional Owners for Cracow are 90 kilometres away, with others even more widespread, the main community development support from Cracow is in the form of education sponsorships and traineeships.The project also provides a lot of community support such as medical support and Meals on Wheels service to the local township community.

GosowongUnder the CSR program (which in 2010 amounted to some US$6 million), a wide range of community benefits are provided. These range from community fencing, drainage, access roads, improved housing, education and health projects through to agricultural projects depending on the priorities of the recipient communities.Egg supplies in the past were unreliable and difficult to obtain. With the assistance from the Corporate Social Responsibility (CSR) program, 2 chicken coops to house up to 2,000 chickens were funded, while the local government paid for training and a vet. The new egg supply will improve family life as eggs will become more easily available and the development of new jobs for Halmaherans. The farm is owned by a local family which employs workers to collect eggs and to look after the chickens.Hidden ValleyThe Hidden Valley Joint Venture has committed to a 5 year Sustainable Community Development Plan, which involves a PNGK20 million budget over that period of time. Main programs under the plan are agriculture, community health, community education and infrastructure.

SOCiEty

COMMUNITY

Newcrest has always been conscious of the importance of relationships and partnerships with host communities. In the past year, the Company has worked hard to develop more formal and consistent approaches to the establishment and maintenance of relationships with stakeholders.As the Company broadens its international footprint, and as it seeks to maintain the objective to be the ‘Miner of Choice’ in those jurisdictions where it is established, more attention has been focused on ensuring that appropriate international standards are at a minimum adhered to, and where necessary built upon.In this context, work is ongoing to revise and upgrade the Community Standards, which sit under the Newcrest Communities Policy, and to establish operational guidelines that spell out for local management what Newcrest expects and requires at each operational site. It is the responsibility of each site then to develop the local specifics within the corporate framework in the form of 5 year communities plans with specific community targets and objectives set against which social performance can be measured.



SO1 managing impacts on communitiesThe principles of our Communities Policy apply equally to all communities impacted by our operations, whether indigenous or non‑indigenous. We place a high value on the support and endorsement of our activities by the communities in which we operate.Our policy in relation to those communities is to:

Recognise and respect the culture, values and traditions • of those communities;Be open and honest in describing the effects that our activities • might have upon them;Consult to achieve mutually acceptable outcomes;• Provide opportunities to share in the benefits which flow from • our activities; andSeek to create lasting relationships built on mutual respect • and trust.

An important first step in this process is to establish a socio‑economic community baseline at the outset, against which changes in the community can be assessed over time, especially in the context of closure.StakeholderengagementA critical first phase in developing relationships is to understand the hierarchy of stakeholders involved in each project, identifying the issues and concerns relevant to each and then establishing a relationship that allows for and focuses on addressing those core concerns in particular.To this end, each Newcrest site will develop a stakeholder engagement strategy that will provide a formal process to identify stakeholders and result in a plan that ensures the necessary resources are directed in a managed and measurable way.

CS5 Community involvementExternalcommunicationThe Board recognises the importance of keeping the market fully informed of the Company’s activities and stakeholder communications in a timely, balanced and transparent manner. In this respect, Newcrest already complies with the new listing rule requirements concerning analyst briefings, which have effect from 1 January 2011.Our Continuous Disclosure Policy ensures that Company information considered to be material is announced immediately through the ASX and key presentations given by Company personnel to investors and institutions are also lodged with the ASX.Key communications are placed immediately on the Company website and provided directly to all shareholders as necessary. General and historical information about the Company and its operations is also available on the website.

Board policy is to achieve effective communication with Newcrest shareholders through compliance with ASX listing rules and Corporation Act reporting requirements, webcasting half year and full year financial results presentations, holding an accessible and informative Annual General Meeting, posting all other ASX announcements and briefing (including investor, analyst and public forums) on the Newcrest website.Shareholders may receive electronic versions of the annual report, other key shareholder communications and notices of meetings.InternalcommunicationsAn extremely important stakeholder group is our employees and at each operating site there are a number of initiatives in place to ensure that employees are as up to date as anyone else. This is important because of course their employment is very much linked to the success of the mine, but also because in many cases employees are members of the local community and are thus a source of feedback. They also have the potential to act as ambassadors for the project within the community. Some of the methods for communicating and engaging with employees are:

formal inductions;• workplace ‘Toolbox’ meetings;• internal publications; and• safety and production meetings.•

Each new employee undergoes a site induction, an important part of which is a briefing on the community issues and cultural awareness relevant to the project and any behavioural requirements (such as restricted access to certain areas) that employees need to be aware of. This induction is also provided to all contractors who work on Newcrest sites and they are also required to observe and adhere to all Company policies, including any commitments to local communities.

Engagement with local communities takes place in many different ways, depending on the nature of the community and the social and governance structures in place in the area concerned. Engagement and communication with local communities is a two way arrangement; we need to hear what communities have to say as well as tell them what we want them to hear. This feedback and input is vital to ensure that our programs are actually answering the questions that people have.There are a number of structures and models that drive engagement at each site and they can include:

local representative committees;• regular and scheduled community or residents • meetings/briefings;open days, managed site tours;• newsletters; radio broadcasts; and • websites.•



CadiaValleyCommunity consultationCadia reviewed the 5 year Community Relations Strategy, which drives the program initiatives for the operations in the Cadia Valley. The vision is to become a valued community member in the Cadia district and a company committed to understanding the expectations of its stakeholders.The four principles of the strategic approach are:1 First and Honest;2 Best and Fairest;3 Give and Grow; and4 Listen and Learn.Cadia has a well established program of public information dissemination built around a series of initiatives; an Annual Environmental report, a CVO Newsletter, which is produced for Cadia district residents, a CVO promotional brochure and DVD set, as well as trade exhibitions and field days that encourage residents to come to the mine and see for themselves.In addition to these programs during the reporting period, the formal community consultation process for the proposed Cadia East Project continued and culminated in NSW Government approval for the Project in January 2010. Consultative activities included:

Three Cadia district residents meetings;• Four • Community Consultative Committee meetings and a site surface and underground tours;Eight focus group meetings held with the Cadia district • residents to develop monitoring and management plans for groundwater, surface water, air quality, noise and blast emissions impacts;Numerous meetings with individual near neighbours as part • of the community consultation process for the approval of the Cadia East project and complaints and concerns management;Numerous local government and media briefings in relation • to the proposed Cadia East Project;Distribution of the Response to Public Submissions on the • Environment Assessment report for the proposed Cadia East Project to the Cadia district residents; andDistribution of the Approval Conditions for the Cadia East • Project to the Cadia district residents.

In April 2010, the Cadia East Project received Board approval and the project has now commenced.In addition to the Cadia East Project, Cadia maintains the Community Partnership program through which funds are made available for community development projects. Submissions from interested community individuals or groups are received and the management committee of the program decides on the funding.Newcrest has also established a series of community based focus groups which will provide a forum for interested residents to participate in discussions about mine related issues and impacts in a constructive and open manner.

CracowThe Cracow mining operation is the only substantial business and employer in the immediate area and as such provides direct support for a number of community initiatives, including schools and scholarships.A major social initiative for Cracow Township in the reporting period was the success in securing a $50,000 federal government grant in resurfacing the Cracow Bowling Green in artificial grass. This will make this area a more useful surface for many sporting and recreational activities. This will also enable the facility to be self‑sustaining, requiring no irrigation and will reduce the ongoing labour component in relation to the up keep of the area. As this grant will only cover the costs associated with the supply and installation of the artificial lawn, Cracow Gold Mine has agreed to complete all of the ground works in readiness for the artificial grass to be laid.TelferTelfer is situated on the edge of the Great Sandy Desert, with the communities of Bidyadanga, Looma and Wangkajungka in the Kimberley, the towns of Marble Bar, Nullagine, Port Hedland and the Aboriginal groups situated between Port Hedland and Telfer are also our key stakeholders.Promoting healthy lifestyles and practise within the workforce at Telfer therefore is highly important due to the remote location and the relative lack of social facilities.Telfer has developed a community development philosophy that reflects the realities of where it is. Sponsorships for instance are targeted at events that provide a basis for bringing together a widely scattered community of people who would otherwise have little contact. Sporting events provide a well received and very well attended forum at which the role of Telfer as sponsor has a very high profile.The very good relations between Telfer as a project and the Martu people are a testament to the effectiveness of this policy.Indigenous relationsTelferTelfer operations conducts a ‘Telfer Indigenous Training program’, which consists of 26 weeks of training leading to the award of a Certificate in Mining and Infrastructure on completion.A number of the participants and graduates of this program have been indigenous women who have successfully obtained employment with Telfer following the course.The second training program run during the year was in Port Hedland, 14 young indigenous people from the area, both male and female, undertook hospitality studies at the Port Hedland TAFE.Previously, Telfer had in place three separate community/compensation agreements with the Martu people, which have now effectively expired, although the payments and commitments under these agreements are still being maintained and recognised by Telfer and an interim arrangement. Telfer has agreed with the representatives of the Martu people that an Indigenous Land Use Agreement (ILUA) will be negotiated to replace the three previous agreements, which in total include most of the aspects of an ILUA.



In large part this decision is driven by a desire to formally acknowledge the Martu people as the holders of the largest Native Title Determination in Australia, and to formalise the arrangements with the community through an instrument that represents the current state of legal best practise. The ILUA agreement when finalised will be a life of mine agreement.As is usual with such agreements the ILUA will cover arrangements relating to cultural heritage, business opportunities, employment, training, compensation and other factors and will be an important step forward in the maturation of the relationship with the Traditional Owners around Telfer.GosowongThe community around the Gosowong mine is much more diverse and physically dispersed than the communities around Newcrest’s other operations. The impacted communities cover 5 administrative sub districts, some 81 villages and a total population in the order of 80,000 persons, a very large footprint by any measure.PapuaNewGuinea–HiddenValleyThe joint venture has committed to PNGK20 million over a 5 year Sustainable Company Development Plan program, which has its principal focus on the expansion of agriculture within the mine affected communities, as well as community health, education and infrastructure.The programs are being rolled out via a series of partnerships with private NGO groups and government agencies, This is practicable in the Morobe province as there are a number of established NGOs that have synergistic objectives that the joint venture has been able to connect with.A priority program of development in the main land owner villages has also been initiated, with each village group being provided with an aid post, community centre and water supply to ensure a base of social infrastructure is in place. A major community water supply program is being implemented through the Lutheran Church Development Arm (LDS) and the Seventh Day Adventist Church (ADRA).

CS6 European heritageCadia Hill and Ridgeway are located in an area which has been mined from the 1850s, with farming settlement from the 1870s onwards. Items of European heritage are therefore located throughout the mining leases.In order to comply with conditions of approval, including heritage legislation, items of European heritage or historical sites are researched, identified and assessed. After the potential impacts of mining are determined, appropriate conservation and/or management procedures are put in place and the necessary permits obtained.

CS7 Contributions to local communitiesEngagement with the communities in which we operate remains important before, during and after project development.Total direct contributions to local communities in 2010 exceeded $12 million. As Newcrest has grown, our capacity to contribute has also increased, in particular at the MMJV project, Cadia East project and Telfer Operations. Improved data definition is also a factor in the increase in contributions. The graph below shows direct contributions from operations to local communities for 2006 to 2010 broken down into the following key segments:Donations: direct donations Infrastructure: electricity, roads, etc. Services: health and education Development: agriculture, micro loans, etc. Other: administrative

Contributions to LocalCommunities($)

07 08 09 1006

DevelopmentOther

ServicesInfrastructureContributions0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

CadiaValleyThe Community Partnerships program is an integral part of the CVO Community Relations Strategy, which allows us to support and enhance existing community infrastructure and services in central western NSW. During the year, CVO made contributions totalling $705,000 to various community groups and local charities. The major recipients included the Good Onya program, Flyers Creek Landcare, Panuara, Schoolyard Blitz, EnviroSmart, Springside progress and Fisheries programs.



GosowongPTNHM allocates 1 percent of revenue to its Corporate Social Responsibility (CSR) program annually. In this financial year, this amounted to $US4 million. Each community has a 3 person committee which determines project expenditure allocations and project priorities, which are then implemented by the CSR team in conjunction with local agencies and sub contractors. This provides a good balance between local ownership and involvement and accountability and transparency.This structure has gained a very high degree of local acceptance as people feel that they are empowered to make decisions about what is important for them and to them, rather than receiving benefits in the form that others think is good for them.A wide range of projects are being and have been funded under the CSR program since its establishment in the current form in 2007.

Community Infrastructure Village electrification Community access roadsCommunity fencesDrainage worksHousing improvement/ replacementChurch and Mosque constructionWharvesWater supplies

Administrative support grants local government; Police

Community Health Facility improvementsSubventions to or payment of staff wages

Community Education Facility improvementsToilet blocksUniforms, books materials for studentsStaff wages or subventionsPayment of school fees

Community Social Support Raskin‑free rice to low income families

Economic Development Seed capital for small businessCredit union establishment

The program is managed by PTNHM, but there is an overall committee, which is made up of all the beneficiary communities which meets at least annually to review developments and discuss future plans. It has been decided by this body that the CSR program will increasingly fund more economically sustainable projects over the next couple of years (a target of 80 percent by 2012 has been agreed). A percentage of the total funds are held back (by agreement) to cover the costs of external technical support and feasibility studies to this end.TelferAt Telfer, the contributions program contributes significantly to the local region, from Telfer to Port Hedland and Marble Bar, supporting the indigenous communities within this region. A number of projects include the provision of sport equipment for sporting carnivals, supporting the Healthy Lifestyle Project, a not for profit venture that aims to deliver healthy food into the remote communities at an affordable price, and providing financial assistance for the Martu Respite Renal Dialysis Centre in Jigalong.

CorporatecontributionsAs Miner of Choice, a key focus for Newcrest is helping to build sustainability and capability in the communities in which we operate to leave a positive and enduring legacy.With funding worth tens of millions of dollars, Newcrest works closely with communities to help improve the quality of life, economic and career prospects of community residents in a sustainable way.Building self sufficiency is paramount, so that the benefits brought by Newcrest mines continue long after they close.Listening to the needs of our neighbours means we help in areas where it is most needed.Respect for the cultures and environments of our communities is at the heart of Newcrest’s approach and throughout the full life cycle of our mines.Complementing site‑based community donations programs, Newcrest’s corporate offices support three community organisations which work to improve the health, wellbeing or prospects of the sick, needy or disadvantaged.During 2010, Newcrest provided around $240,000: to the Juvenile Diabetes Research Foundation ($104,222); The Salvation Army’s Tinning Street Partnership ($109,000); and Melbourne Citymission ($24,114). Numerous smaller donations were also given to not‑for‑profit organisations.Newcrest’s employees at all our sites are encouraged to participate. Many lend a hand with ‘in kind’ (non‑cash) donations by volunteering their time, knowledge and skills to help.

mm6a/B Significant community issuesThere were no significant incidents at or adjacent to any Newcrest managed site involving disputes over land use, customary rights or issues relating to indigenous people. On 16 November 2009, the Union of Watut River Communities published a list of claims in the national newspaper. These demands included compensation for lost incomes, food and water supply and rectification of environmental impacts. HVJV is speaking with the PNG Government and actively engaging with local communities to ensure all their concerns are considered.

mm7 artisanal and small‑scale miningIllegal mining continues at Gosowong, albeit at a relatively low level compared to the past. It is estimated by project security that around 800 persons might be involved in this activity, down from the several thousand of a few years back.The improper use handling and disposal of dangerous chemicals such as mercury and cyanide by persons engaged in unlawful activity continues to be a concern.In Papua New Guinea, artisanal mining has been practised in the lower reaches of the Watut River and in other river systems for generations. This activity is more or less regulated by the Government but there are many unlicensed operators working the river systems now.At this point, there is no illegal mining within the Hidden Valley mine lease area.

mm8 resettlementThere was one instance of resettlement during the year. Cracow works hard on its relationships and one significant community project was the relocation of a long‑term resident who lived in close proximity to the mine.



mm9 Closure PlansAll Newcrest sites have closure plans in place, and the costs of closure are provided for in the balance sheet of each operation. The social and community aspects of site closure plans will be progressively revisited to establish clear community outcomes.The process of developing these community outcomes around closure will be done as a partnership between the Company and the affected communities.Closure plans are updated on a regular basis.

CORRUPTION

SO2 risks related to corruptionNewcrest’s Code of Conduct specifically deals with bribery and corruption. It states that:‘We neither offer, seek nor accept bribes, either directly or indirectly. We must not seek, offer or accept any payments, gifts, benefits or entertainment beyond that which is considered as normal and legitimate business practice.’All employees are required to report to their managers any breach of the Code of Conduct. The full protection of the Board of Newcrest will be granted, in relation to the reporting, to anyone who reports misconduct.It is mandatory that any breach involving dishonesty or misuse of Company funds, assets or information be reported immediately. If an employee feels unable to discuss a breach with their immediate manager, or is unhappy with their manager’s response then it can be raised with the Company Secretary or Internal Auditor.

SO3 anti‑corruption trainingNewcrest’s Code of Conduct states that ‘We neither offer, seek nor accept bribes, either directly or indirectly’ (see Section SO2 above). To reinforce this position, Newcrest’s MD and CEO Ian Smith, circulated a memo to senior and middle management stressing the need to comply with laws relating to corruption. In the memo (dated 13 September 2006) Mr Smith stated that:‘This memorandum is intended as a reminder to all Newcrest personnel of the laws relating to foreign corrupt practices to which we are subject and to underline the serious nature of the provisions, the consequences of their contravention, and the critical importance of continuing compliance from Newcrest’s point of view.’A company may be found liable for bribery of foreign officials committed by an employee, agent or officer, if the company has expressly, tacitly or impliedly authorised or permitted the commission of the offence. This can be established by showing that:

the board of directors or a high managerial agent intentionally, • knowingly or recklessly carried out the conduct or expressly, tacitly or impliedly allowed it to occur;a corporate culture existed that directed, encouraged, tolerated • or led to the offence; and/orthe company failed to create and maintain a corporate culture that • required compliance with the relevant laws.‘

SO4 instances of corruptionNo instances of bribery or corruption have been reported to the Board or management in the past year.

PUBLICPOLICY

SO5 Public policy positionNewcrest presents views to governments and others on matters affecting our business interests in order to contribute to the development of sound legislation and regulation.To achieve these objectives, Newcrest works through a number of peak industry bodies in the jurisdictions in which we operate. Newcrest is a member of the following business organisations:

Minerals Council of Australia;• New South Wales Minerals Council;• Chamber of Minerals and Energy of Western Australia;• Australian Mines and Metals Association;• Australian Safety and Compensation Council;• Corporate Tax Association of Australia;• Indonesian Mining Council;• Australia Fiji Business Council;• Papua New Guinea Chamber of Mines and Petroleum; and• Copper Development Centre (Australia).•

Newcrest’s Code of Conduct recognises the right of individuals to participate in the political process provided they take care that their views are not identified as those of the Company.

SO6 Donations to political parties and institutionsNewcrest conducts its business in accordance with a policy of strict political neutrality, and does not make Company contributions to political parties or political candidates in any jurisdiction in which it operates.Newcrest policy is to provide donations to national or regional community benefit organisations or to local entities servicing the local communities in which the Company operates.

ANTI-COMPETITIVEBEHAVIOUR

SO7 legal action for anti‑competitive behaviourThe Company has not been subject to any court decisions regarding anti‑trust and monopoly regulations.At all times the Company’s Code of Conduct is the guiding policy for preventing anti‑competitive behaviour.

COMPLIANCE

SO8 fines for non‑complianceThere have been no fines or non‑monetary sanctions levied against the Company for non‑compliance with laws and regulations during the reporting period.



PrODuCt rESPOnSiBility

CUSTOMERHEALTHANDSAFETY

Pr1 Product health and safetyWe do not produce any products which are traded directly with the general public. Our products are gold doré and copper concentrate.GolddoréGold doré is produced at each of our operations. Doré is unrefined gold bullion bars usually consisting of approximately 90 percent precious metal (including some silver) which is shipped to a mint for refining into almost pure metal. This is the principal product at Cracow and Gosowong. At Cadia Valley and Telfer, some gold is produced as doré, with the remainder being shipped to smelters in the copper concentrate.Gold’s compatibility with living systems and lack of toxicity make it indispensable in dentistry and medicine. It has no detrimental effect when released to the environment.CopperconcentrateCopper concentrate transportAt Cadia Valley, copper concentrate is pumped via a 36 kilometre buried pipeline from the mine to a dewatering facility at Blayney. After dewatering, the concentrate is loaded into shipping containers and railed to Port Kembla, where it is unloaded from the containers and placed in bulk storage. A system of covered conveyors is used to transfer the concentrate from storage to ships for transport to our customer smelters. Should there be an accident on the rail line, the shipping container provides the first level of security and containment. Even if there was some spillage from a damaged container, the relatively dry product (‹10 percent moisture content) would be able to be cleaned up without significant release to the environment.At Telfer, copper concentrate is transported in road‑trains 420 kilometres from the mine to the copper concentrate storage facility at Port Hedland. The road‑trains are covered to ensure minimal spillage or dusting during transport. A system of covered conveyors is used to transfer the concentrate from storage to ships for transport to our customer smelters. The haulage contractor is required to have in place an emergency response plan in the event of an accident during transport.

Health and environmental effects of copperCopper occurs naturally in the air we breathe, the water we drink, and the soil in which we grow our food. This essential micronutrient plays an important role in protecting the environment and the health of every living thing.Copper is a trace element that is essential for most animals, including humans. It is absorbed mainly by the small intestine, but also through the stomach. Copper is found in the blood bound to proteins, which help biochemical reactions occur in every cell. It also assists in the body’s absorption, storage and metabolism of iron.Most copper released to air, water, sediment, and soil strongly attaches to other particles, thus reducing the toxicity of copper. Copper can be transported as particles released into the atmosphere or as dissolved compounds in natural waters.For additional information on copper a useful website is maintained by the Copper Development Centre at www.copper.com.au.

Pr2 non‑compliances concerning customer health and safetyWe had no instances of non‑compliance with regulations concerning customer health and safety.No penalties or fines were assessed.

PRODUCTANDSERVICELABELLING

Pr3 Product information and labellingWe provide our products to our customers in bulk, so there is no conventional product labelling.

Pr4 non‑compliance with product information and labellingWe had no instances of non‑compliance with regulations concerning product information and labelling.No penalties or fines were assessed.

Pr5 Customer satisfactionWe work very closely with our customers to ensure that their requirements are met. This principally revolves around ensuring our copper concentrate is within agreed contract specifications, and that shipments are made on an agreed schedule. Our Marketing Manager periodically visits our customers to discuss any existing issues and to negotiate future contracts.

MARKETINGCOMMUNICATIONS

Pr6 advertising, promotions and sponsorshipsThis area is not relevant to our activities.

Pr7 Breaches of advertising and promotions regulationsWe had no instances of breaches of advertising and marketing regulations.



CUSTOMERPRIVACY

Pr8 Customer privacyThe Company is committed to ensuring the appropriate and lawful collection, use, disclosure, correction and storage of personal information. Our Information Technology Security Policy applies to prospective employees, employees, contractors and consultants. The Company strictly adheres to all legal requirements regarding privacy.Key elements of the Policy include:OpennessOn request, individuals will be advised of what personal information the Company holds, the purpose for which it is held and how the information is collected, held, used and disclosed.Access and correctionIn most instances, individuals will be provided access to personal information held about them and will be able to make corrections to that information.Sensitive informationThe Company will not collect sensitive information, including details of race, ethnic origin, political opinion or health, except where the individual has consented or the information is required by law.Substantiated complaints regarding customer privacyWe had no instances of substantiated complaints regarding breaches of consumer privacy.

COMPLIANCE

Pr9 fines and non‑complianceThere were no product responsibility related civil and/or criminal fines or other penalties (including imprisonment) assessed against the organisation or its directors and officers when in their organisational capacity during the reporting period.


gRI INdICATOR TABLE

EnVirOnmEntal PErfOrmanCEGRIIndicatorsEN Environmental PerformanceLA Social Performance – Labour Practices and Decent WorkHR Social Performance – Human RightsSO Social Performance – SocietyPR Social Performance – Product ResponsibilityEC Economic PerformanceCS Social Performance – Company‑SpecificMM Mining & Metals Supplement

ReportingLevell Included l Partially Included l Not Included

GRIIndicator Description Location ReportingLevel

Materials

EN1 Materials used by weight or volume. Materials use. l

EN2 Percentage of materials used that are recycled input materials. Materials used which are recycled.

l

MM4 Percentage of products(s) derived from secondary materials. Products derived from secondary materials.

l

MM5 Describe policies for assessing the eco‑efficiency and sustainability attributes of products (e.g., recyclability, material use, energy use, toxicity, etc).

Stewardship. l

Energy

EN3 Direct energy consumption by primary energy source. Direct energy consumption. l

EN4 Indirect energy consumption by primary source. Indirect energy consumption. l

EN5 Energy saved due to conservation and efficiency improvements. Energy conservation and efficiency improvements.

l

EN6 Initiatives to provide energy‑efficient or renewable energy based products and services, and reductions in energy requirements as a result of these initiatives.

Energy‑efficient products and services.

l

EN7 Initiatives to reduce indirect energy consumption and reductions achieved. Reduced indirect energy consumption.

l

Water

EN8 Total water withdrawal by source. Total water withdrawal. l

EN9 Water sources significantly affected by withdrawal of water. Impact of water withdrawal. l

EN10 Percentage and total volume of water recycled and reused. Recycling and reuse of water. l

Biodiversity

EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas.

Protected areas, or areas of high biodiversity value.

l

EN12 Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas.

Significant impacts on protected areas.

l

EN13 Habitats protected or restored. Habitats protected or restored.

l

EN14 Strategies, current actions, and future plans for managing impacts on biodiversity.

Strategies for managing impacts on biodiversity.

l

EN15 Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk.

Listed species. l

MM3 The number/percentage of sites identified as requiring biodiversity management plans, and the number/percentage of sites with plans in place. Also include criteria for deciding that a biodiversity management plan is required and the key components of a plan.

Number of sites requiring biodiversity management process.

l


gRI INdICATOR TABLE


Emissions,Effluents,andWaste

EN16 Total direct and indirect greenhouse gas emissions by weight. Greenhouse gas emissions. l

EN17 Other relevant indirect greenhouse gas emissions by weight. Other indirect greenhouse gas emissions.

l

EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved. Greenhouse gas reduction initiatives.

l

EN19 Emissions of ozone‑depleting substances by weight. Ozone‑depleting substances. l

EN20 NO, SO, and other significant air emissions by type and weight. Significant air emissions. l

EN21 Total water discharge by quality and destination. Water discharges. l

EN22 Total weight of waste by type and disposal method. Other wastes. l

EN23 Total number and volume of significant spills. Significant spills. l

EN24 Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally.

Transport of hazardous waste.

l

EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting organization’s discharges of water and runoff.

Water bodies significantly affected by discharge.

l

MM6 Describe approach to management of overburden, rock, tailings, and sludges/residues including:

assessment of risks;• structural stability of storage facilities;• metal leaching potential; and• hazardous properties.•

Large volume process wastes. l

ProductsandServices

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation.

Environmental impacts of products and services.

l

EN27 Percentage of products sold and their packaging materials that are reclaimed by category.

Product recycling. l

Compliance l

EN28 Monetary value of significant fines and total number of non‑monetary sanctions for non‑compliance with environmental laws and regulations.

Incidents of, and fines for, non‑compliance.

l

Transport

EN29 Significant environmental impacts of transporting products and other goods and materials used for the organization’s operations, and transporting members of the workforce.

Significant environmental impacts of transportation.

l

Overall

EN30 Total environmental protection expenditures and investments by type. Environmental expenditure. l

OperationsClosure

MM10 Number or percentage of operations with closure plans, covering social – including labour transition –, environmental and economic aspects. Describe company policy, stakeholder engagement processes, frequency of plan review, and amount and type of financial provisions for closure.

Mine closure. l


gRI INdICATOR TABLE

SOCial PErfOrmanCEGRIIndicatorsEN Environmental Performance LA Social Performance – Labour Practices and Decent Work HR Social Performance – Human Rights SO Social Performance – Society PR Social Performance – Product Responsibility EC Economic Performance CS Social Performance – Company‑Specific MM Mining & Metals SupplementReportingLevell Included l Partially Included l Not Included


LABOURPRACTICES&DECENTWORK

Employment

LA1 Total workforce by employment type, employment contract, and region. Workforce. l

LA2 Total number and rate of employee turnover by age group, gender, and region. Employee turnover. l

LA3 Benefits provided to full‑time employees that are not provided to temporary or part‑time employees, by major operations.

Employee benefits. l

Labour/ManagementRelations

LA4 Percentage of employees covered by collective bargaining agreements. Representation. l

LA5 Minimum notice period(s) regarding operational changes, including whether it is specified in collective agreements.

Employee negotiations. l

OccupationalHealthandSafety

LA6 Percentage of total workforce represented in formal joint management–worker health and safety committees that help monitor and advise on occupational health and safety programs.

Joint health and safety committees.

l

LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and number of work related fatalities by region.

Safety statistics. l

LA8 Education, training, counselling, prevention, and risk‑control programs in place to assist workforce members, their families, or community members regarding serious diseases.

Health issues. l

LA9 Health and safety topics covered in formal agreements with trade unions. Agreements with trade unions covering health and safety.

l

MM12 Describe approach to identifying, preparing for, and responding to emergency situations affecting employees, communities, or the environment. Include a description of the nature of existing skills, teams who respond to emergency situations, training, drills, review processes and community involvement.

Emerging preparedness. l

MM13 Number of new cases of occupational disease by type. Describe programs to prevent occupational disease.

New cases of occupational disease.

l


gRI INdICATOR TABLE


TrainingandEducation

LA10 Average hours of training per year per employee by employee category. Employee training. l

LA11 Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings.

Policies for skills management for lifelong learning.

l

LA12 Percentage of employees receiving regular performance and career development reviews.

Performance review. l

DiversityandEqualOpportunity

LA13 Composition of governance bodies and breakdown of employees per category according to gender, age group, minority group membership, and other indicators of diversity.

Diversity. l

LA14 Ratio of basic salary of men to women by employee category. Remuneration. l

HUMANRIGHTS

InvestmentandProcurementPractices

HR1 Percentage and total number of significant investment agreements that include human rights clauses or that have undergone human rights screening.

Human rights in investment agreements.

l

HR2 Percentage of significant suppliers and contractors that have undergone screening on human rights and actions taken.

Screening of suppliers and contractors.

l

HR3 Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained.

Employee training on human rights.

l

Non-Discrimination

HR4 Total number of incidents of discrimination and actions taken. Incidents of discrimination. l

FreedomofAssociation

HR5 Operations identified in which the right to exercise freedom of association and collective bargaining may be at significant risk, and actions taken to support these rights.

Right to freedom of association and collective bargaining.

l

ChildLabour

HR6 Operations identified as having significant risk for incidents of child labour, and measures taken to contribute to the elimination of child labour.

Incidents of child labour. l

ForcedandCompulsoryLabour

HR7 Operations identified as having significant risk for incidents of forced or compulsory labour, and measures to contribute to the elimination of forced or compulsory labour.

Incidents of forced and compulsory labour.

l

SecurityPractices

HR8 Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations.

Human rights training for security personnel.

l


gRI INdICATOR TABLE


IndigenousRights

HR9 Total number of incidents of violations involving rights of indigenous people and actions taken.

Incidents involving rights of indigenous people.

l

CS1 Indigenous communities in our areas of operation. Indigenous communities. l

CS2 Agreements that assist development of indigenous people. Indigenous agreements. l

CS3 Surveys and agreements that identify and/or preserve significant aboriginal cultural heritage.

Aboriginal cultural heritage. l

CS4 Contributions made to indigenous communities, including employment and training, health, education and community development.

Contributions to indigenous communities.

l

MM11 Describe process for identifying local communities’ land and customary rights, including those of indigenous peoples, and grievance mechanisms used to resolve any disputes.

Land rights. l

SOCIETY

Community

SO1 Nature, scope, and effectiveness of any programs and practices that assess and manage the impacts of operations on communities, including entering, operating, and exiting.

Managing impacts on communities.

l

CS5 Initiatives and programs that benefit local community stakeholders. Community involvement. l

CS6 Practices related to the conservation of European heritage items or historical sites.

European heritage. l

CS7 Major financial contributions that assists local community initiatives. Contributions to local communities.

l

MM6A/B Describe significant incidents affecting communities during the reporting period, and grievance mechanisms used to resolve the incidents and their outcomes.

Significant community issues. l

MM7 Describe programs in which the reporting organisation has been involved that addressed artisanal and small‑scale mining (ASM) within company areas of operation.

Artisanal and small‑scale mining.

l

MM8 Describe resettlement policies and activities:Identify sites where resettlements took place and the number • of households resettled in each;Include practices regarding resettlement and compensation, and • the degree of alignment with the World Bank Operational Directive on Involuntary Resettlement.

Resettlement. l

MM9 Closure plans have been developed for operations. Closure plans. l

Corruption

SO2 Percentage and total number of business units analysed for risks related to corruption.

Risks related to corruption. l

SO3 Percentage of employees trained in organization’s anti‑corruption policies and procedures.

Anti‑corruption training. l

SO4 Actions taken in response to incidents of corruption. Instances of corruption. l


gRI INdICATOR TABLE


PublicPolicy

SO5 Public policy positions and participation in public policy development and lobbying.

Public policy position. l

SO6 Total value of financial and in‑kind contributions to political parties, politicians, and related institutions by country.

Donations to political parties and institutions.

l

Anti-CompetitiveBehaviour

SO7 Total number of legal actions for anticompetitive behaviour, anti‑trust, and monopoly practices and their outcomes.

Legal action for anti‑competitive behaviour.

l

Compliance

SO8 Monetary value of significant fines and total number of non‑monetary sanctions for non‑compliance with laws and regulations.

Fines for non‑compliance. l

PRODUCTRESPONSIBILITY

CustomerHealthandSafety

PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures.

Product health and safety. l

PR2 Total number of incidents of non‑compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes.

Non‑compliances concerning customer health and safety.

l

ProductandServiceLabelling

PR3 Type of product and service information required by procedures and percentage of significant products and services subject to such information requirements.

Product information and labelling.

l

PR4 Total number of incidents of non‑compliance with regulations and voluntary codes concerning product and service information and labelling, by type of outcomes.

Non‑compliance with product information and labelling.

l

PR5 Practices related to customer satisfaction, including results of surveys measuring customer satisfaction.

Customer satisfaction. l

MarketingCommunications

PR6 Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship.

Advertising, promotions and sponsorships.

l

PR7 Total number of incidents of non‑compliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes.

Breaches of advertising and promotions regulations.

l

CustomerPrivacy

PR8 Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data.

Customer privacy. l

Compliance

PR9 Monetary value of significant fines for non‑compliance with laws and regulations concerning the provision and use of products and services.

Fines and non‑compliance. l


gRI INdICATOR TABLE

ECOnOmiC PErfOrmanCEGRIIndicatorsEN Environmental Performance LA Social Performance – Labour Practices and Decent Work HR Social Performance – Human Rights SO Social Performance – Society PR Social Performance – Product Responsibility EC Economic Performance CS Social Performance – Company‑Specific MM Mining & Metals SupplementReportingLevell Included l Partially Included l Not Included


EconomicPerformance

EC1 Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments.

Economic value generated and distributed.

l

EC2 Financial implications and other risks and opportunities for the organization’s activities due to climate change.

Financial implications of climate change.

l

EC3 Coverage of the organization’s defined benefit plan obligations. Superannuation schemes. l

EC4 Significant financial assistance received from government. Government financial assistance.

l

MM1 Identify those sites where the local economic contribution and development impact is of particular significance and interest to stakeholders (e.g., remote sites) and outline policies with respect to assessing this contribution. Relevant information includes:

Percentage of goods, materials, and services purchased locally;• Percentage of workforce from local communities;• Investment in public infrastructure and its maintenance; and• Compensation payments.•

Revenue capture, management and distribution.

l

MM2 Value added disaggregated to country level. Value added. l

MarketPresence

EC5 Range of ratios of standard entry level wage compared to local minimum wage at significant locations of operation.

Wage levels. l

EC6 Policy, practices, and proportion of spending on locally‑based suppliers at significant locations of operation.

Locally‑based suppliers. l

EC7 Procedures for local hiring and proportion of senior management hired from the local community at locations of significant operation.

Origin of managers. l

IndirectEconomicImpact

EC8 Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in‑kind, or pro bono engagement.

Infrastructure investments and services.

l

EC9 Understanding and describing significant indirect economic impacts, including the extent of impacts.

Indirect economic impacts. l


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