Vale CEO Roger Agnelli Sustainability Report Message

Vale 2007 Sustainability Report

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Vale CEO Roger Agnelli

Sustainability is essential for the feasibility of mining activities and for regional and community development where we operate

It is with great pleasure that I present to you Vale´s 2007 Sustainability Report, prepared according to the GRI guidelines, in its updated version the G3. Communication of this information shows Vale’s commitment to transparency in our activities and the improvement of internal sustainability management, in which we will continue to aggressively invest in the coming years.

The last three years were exceptional for Vale. We exceeded all our objectives in production, investment and value generation to our shareholders. During 2007, we consolidated the acquisition of Inco Limited, which occurred in October 2006, and acquired AMCI Holdings Australia Pty, in February 2007, two leading companies in the nickel and coal industries, respectively. With our expanded product portfolio, Vale became the second largest diversified mining company in the world, with operations in 34 countries on five continents. These results were only made possible through the work and dedication of our employees, to whom I extend my sincere gratitude.

In this period we also had great achievements towards Vale’s sustainable development, highlighted by considerable social and environmental investments, which have grown year after year to reach US$ 686 million in 2007.

In 2007 we defined our new Mission Statement: “To Transform Mineral Resources into Prosperity and Sustainable Development”, and also our Vision and Values. This work culminated in the changing of our brand in order to reflect our new corporate reality and our commitment to the present and the future. From this year on, we will be known by the “Vale” brand name throughout the world.

Vale’s Mission reflects our understanding that sustainability is instrumental to mining in the short, medium and long term. It also acknowledges the relevance of the company’s contribution towards sustainable development in the regions and communities where we operate, through the engagement and involvement of our stakeholders.

Meaningful engagement remains one of our greatest challenges and priorities, which we will continue to address in a way that is consistent with our role as a leading publicly traded company in the extractive and industrial sectors.

At Vale, sustainability begins with our relationship with employees, most notably in issues of health and safety. Our strategy involves training and leadership, raising awareness among employees and contractors, and the implementation of tools that can avoid or minimize incidents. Nevertheless, despite investments and advancements achieved in our operating processes, we deeply regret the loss of 14 valuable lives in 2007.We have re-doubled our efforts towards our goal of zero fatalities. This can only be achieved through perseverance, discipline, determination and coordinated actions in all locations.

With the intense growth of our operations over the last three years, we have created over 50,000 jobs (employees and contractors). Investments of US$ 59 billion forecast for the period 2008-2012 are expected to create 62,000 additional jobs. As such, the training, hiring and retention of our employees are paramount to our corporate strategy. Vale has invested significantly in the education and training of our employees and also of community members in the areas where we operate, providing these individuals with greater opportunities for employment, whether at Vale or in other companies. Such investments are instrumental, as the increased income can improve local quality of life.

We have also increased our commitment to institutions and international sustainability principles. We became a signatory of the United Nations Global Compact, and of the Global Business Coalition (GBC) on HIV/Aids, Tuberculosis and Malaria. We are also an active participant in the International Council on Mining and Metals (ICMM), the mining industry’s global forum on sustainability.

In recent years, the Amazon region has gained the attention of the world and become part of the sustainability agenda for many institutions. Vale has been developing, for many years, environmental conservation and preservation projects in several regions, particularly in the Amazon area, where we maintain important operating units in the southeastern region of the State of Pará. In that region, we support and foster the conservation of 8,000 km2 of native forest in an area known as Mosaico Carajás. We have provided support for the implementation of technologies to monitor deforestation and fires in the Amazon Rain Forest, helping authorities fight predatory activities.

Our most recent effort to reclaim the Amazon Biome and to promote sustainable practices in the region is the Vale Florestar Project, which aims to rehabilitate a depleted area of over 3,000 km2 outside of our operations by 2015.Our objective is to contribute to the recovery of this area through a socially and environmentally sustainable model.

Vale has dedicated special attention to global sustainability issues, being alert to trends and concerns of the international community, especially in terms of the new reality imposed by climate changes. Vale has recently developed our corporate guidelines on the matter and established the Vale Carbon Program. Vale has been improving the quality of its green house gas inventory. Our company holds a unique position, as the electric power we consume is predominantly (89%) from hydroelectric sources. Vale seeks to find the necessary balance between energy supply, cost and sustainability with regard to greenhouse gas emissions. This is made clear by the increased use of biofuels in our operations, ongoing investments in clean and renewable energy technologies, and continued efforts to improve our energy efficiency.

We are dedicated to achieving our objectives of growth and adding value to shareholders while mitigating environmental impacts on a local and global scale, as well as effectively contributing to the development of society. We believe that the development of a sustainable future depends on cooperation among all stakeholders and that sustainability begins with the decisions we make today.

Once again I express my satisfaction in presenting this report to you. It is my hope that its contents will contribute to a greater knowledge of the effort that Vale is making towards sustainable development.