Vale

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Climate Change

Facing climate issues

Aware of our role on the matter of climate change, Vale recently developed our Climate Change Corporate Guideline. Its general principles are described below:

• We understand that the issue of climate change is of fundamental importance to the environmental, economic and social sustainability of the planet, and that it can affect our business activities.
• We recognize the existence of scientific evidence of global warming, and that this is directly related to the increase in the concentration of greenhouse gases (GHG) in the atmosphere associated with human activities.
• We believe that the effects of climate change impact on the ecosystems of our planet and, as a consequence, on the economic activities in territories where we operate.
• It is our understanding that climate change can have implications for our strategic plans, and that, therefore, actions should be undertaken to evaluate the risks to business and comparative advantages, minimizing vulnerabilities and maximizing opportunities.
• It is our understanding that coal and other fossil fuels will continue to have an important role in the global energy matrix, and that there is a need to strive for balance between energy security and climate security.
• We consider the development and dissemination of technology fundamental aspects for dealing with climate change.
• It is our understanding that we must monitor the evolution of the national and international milestones of climate change in the process of development, assess the implications for our businesses and engage with policymakers.
• We are committed to participating in the global effort seeking the stabilization of the concentration of greenhouse gases in the atmosphere at acceptable levels, employing our best efforts, according to the regulations in force and aligned with these guidelines, and promoting coordinated actions in all our operations in order to attain this objective.
• With respect to confronting climate change, our principal focus of action in the territories in our area of influence will be related to its effects on physical infrastructure, water availability and biodiversity, as well as on the local socio-economic conditions.
• We have been tracking and managing our greenhouse gas (GHG) emissions since 2005, and recognize that the nature of our industrial activity and the size of our operations results in significant emissions of GHG.
• We have been tracking and managing our greenhouse gas (GHG) emissions since 2005, andrecognize that the nature of our industrial activity and the size of our operations results in significant emissions of GHG.

Climate change is an issue of increasing relevance to our company. We understand that to face this issue effectively, action by civil society, corporations and governments are necessary. Only with an integrated effort will we manage to overcome the challenge set before all citizens today: to attend to the current need for development without compromising the well being of future generations.

As a result, we are focused on developing strategies that contribute to the reduction of greenhouse gases, going beyond the constant search for reductions in fuel consumption while continuing to produce high quality iron ore, which helps reduce energy consumption and CO2 emissions from the blast furnaces of our clients in the iron and steel industry.

Additionally, as an integral part of our corporate Climate Change Guidelines, Vale has established a wide-ranging set of globally coordinated measures, with the objective of attaining standards of excellence in our actions regarding climate change by 2012. The Vale Carbon Program is based on five fundamental principles:

1. Additionally, as an integral part of our corporate Climate Change Guidelines, Vale has established a wide-ranging set of globally coordinated measures, with the objective of attaining standards of excellence in our actions regarding climate change by 2012. The Vale Carbon Program is based on five fundamental principles:
2. Additionally, as an integral part of our corporate Climate Change Guidelines, Vale has established a wide-ranging set of globally coordinated measures, with the objective of attaining standards of excellence in our actions regarding climate change by 2012. The Vale Carbon Program is based on five fundamental principles:
3. Cooperation and partnership for research and development into technologies and the implementation of mitigation and adaptation measures in the territories where we operate.
4. Engagement with governments and other companies in the private sector to monitor and contribute to the preparation of the regulatory milestones necessary to develop climate change responses.
5. Transparency and continuous improvement.

Vale has already been developing initiatives for this purpose. During 2006, we began the assessment process for greenhouse gas reduction opportunities and development of projects aligned with the Clean Development Mechanism (CDM), recognizing that the carbon market is an important instrument in climate change mitigation. Some examples:

• Vale has already been developing initiatives for this purpose. During 2006, we began the assessment process for greenhouse gas reduction opportunities and development of projects aligned with the Clean Development Mechanism (CDM), recognizing that the carbon market is an important instrument in climate change mitigation. Some examples:
• Fuel switch from oil to natural gas in some of our iron ore pelletizing plants in Brazil.
• Substitution, since 2007, of a part of our diesel for biodiesel in the locomotives operating on some of our railways.

We also have developed various forest conservation initiatives. These initiatives are detailed in the Biodiversity chapter. Additionally, Vale has developed a pioneer project, called Vale Florestar, to support Amazon Biome reclamation and the promotion of sustainable practices in the region. Through this initiative, we intend to promote the reclamation of 3,000 km2 of degraded land outside our areas of operation by 2015, through a socially and environmentally sustainable model (to learn more about this project, see the case"Forest protecting forest").

The company has also participated in recent editions of the Carbon Disclosure Project¹ (CDP).

¹ Global report, formulated throughout the world by institutional investors with the purpose of refining and publicizing information about companies listed on the FT500 ranking concerning their climate change policies and strategies for reducing environmental risks in their operations. The FT 500 Ranking includes the 500 largest worldwide companies in market capitalization and is published by Financial Times.

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