CAP

SUSTAINABILITY
REPORT
2016

2


CAP AND ITS
STRATEGY

VALUE CHAIN

The value chain of the CAP Group begins with the exploration and mining of iron ore; it continues with steel manufacturing and goes on to elaborating steel solutions.

CAP MINERÍA

The work of CAP Mineria begins with the exploration and evaluation of new resources and the development and construction of a mining project. Upon becoming operational, the company extracts mines and processes iron ore.

The company markets high-ore-grade magnetic iron in the form of concentrate and pellets. This form of product offers an advantage over hematic minerals since its use requires a smaller quantity of raw material and energy; all of which contributes toward the sustainability of the steel making process.

Supply chain

Particularly important in its supply chain are: energy, water, fuels and critical mining equipment components.

CAP ACERO

Iron ore is an input of CAP Acero’s steel production. This is the only such industry in Chile, since it produces steel from raw materials existing in nature (iron ore, coal and limestone), which guarantees high-purity and quality products.

The company produces thick bars for the manufacturing of ore milling equipment, wire rods and concrete reinforcing bars intended for the construction sector.

Supply chain

The essential ingredients of its supply chain are: iron ore, metallurgical coal, limestone, electric energy, water and other ingredients typical in metallurgical production.

STEEL PROCESSING
(CINTAC and TASA, TUPEMESA)

Steel Processing offers value added solutions for housing, industrial and infrastructure construction in Chile, Peru and Argentina. It is comprised of: CINTAC S.A. (and its subsidiary companies: CINTAC S.A.I.C. and Tupemesa S.A.) and by Intasa (with its subsidiary company Tubos Argentinos S.A - TASA).

In 2016, CINTAC became consolidated as a manufacturer of photovoltaic structures for projects in Chile and abroad, which permitted positioning the company at a Latin American level.

Supply chain

In the case of tubes and profiles the critical inputs are: steel, zinc for the process of galvanized, electricity and water (well) for cooling the tubes. The critical inputs for the panels are: steel and paint for ironing. In the manufacture of insulated panels, some of the key inputs are: steel, PUR (polyurethane), PIR (Polyisocyanurate), POL (polystyrene), rock wool, paint and electricity for the operation of the equipment.

CAP INFRASTRUCTURE

The CAP group is expanding to related businesses, taking advantage of its competitive advantages in port infrastructure, the generation of electricity and water, and in the mining of other metals.

The company has six ports (Punta Totoralillo, Guacolda II, Las Losas, Guayacan, Huachipato and Guarello) and in 2016 it was ranked as the third largest port operator in Chile.

The desalination plant is located in the area near Puerto Punta Totoralillo, in the municipality of Caldera (Atacama Region), which provides industrial water to mining clients located in that region. Additionally, the CAP Group owns a power transmission line. Moreover, the company is making inroads in the evaluation of projects of other minerals (copper, gold, and others).

Supply chain

In the operation of the ports, the critical services are the stevedores, the dock and equipment. In the case of the desalination plant, these are the supply of CO2 and lime for demineralizing desalinated process water and electrical energy to operate the system.