| Mon 4 Feb 2008, 11:17 | | AFO - Aflease Gold Provides Update on Operations and Resources |
|
AFO
AFO
AFO - Aflease Gold Provides Update on Operations and Resources
News Release
AFLEASE GOLD LIMITED
(Formerly Sub Nigel Gold Mining Company Limited)
Incorporated in the Republic of South Africa
(Registration number: 1984/006179/08)
Share code: AFO (JSE) AFSGY - International PrimeQX (OTCQX)
ISIN: ZAE000075867
("Aflease Gold" or "the company")
NEWS RELEASE
Aflease Gold Provides Update on Operations and Resources
Johannesburg, South Africa - Aflease Gold Limited is pleased to provide the
following update on the development of the Modder East gold project and to
announce revised mineral resource estimates for its Ventersburg and Sub Nigel
properties.
Highlights:
- Total independently audited resource base has increased fourfold from 4.8
million ounces to 19.99 million ounces, of which 2.94 million ounces are in
the indicated category and 17.05 million ounces are in the inferred
category.
- An initial inferred mineral resource estimate at Ventersburg of 30.5
million tonnes at a grade of 4.74 g/t containing 4.65 million ounces of
gold.
- An initial inferred mineral resource estimate at Sub Nigel 6 of 83.37
million tonnes at a grade of 3.77 g/t containing 10.11 million ounces of
gold.
- The Modder East project is fully funded and development is on track for its
first gold pour in Q3 2009.
- Sinking of the vertical shaft and construction of the processing plant at
Modder East has commenced.
- Additional prospecting rights granted at Ventersburg 2 (2,800 hectares)
adjacent to the company`s existing Ventersburg project and at Bothaville
(8,500 hectares).
- An application for further prospecting rights (at an area known as
Ventersburg 3) has been accepted by the Department of Minerals and Energy.
Aflease Gold`s CEO Neal Froneman commented:
"With development progress at Modder East firmly on track, a significant
increase in total resources and new prospecting rights to fill out the growth
pipeline, the company is well placed to achieve its goal of becoming a high
margin, mid-tier gold producer."
Reserve and Resource Statements
Modder East Audited Reserves (Dec 2007)
Tonnes Gold Grade Gold Content
(Mt) (g/t) (Moz)
Probable
BPLZ 5.39 6.09 1.06
UK9A 2.26 4.13 0.30
Total Probable 7.65 5.51 1.36
Notes:
1. The revised reserve statement was prepared by Turgis Consulting and audited
by SRK Consulting. The gold content figures are fully inclusive of mining
dilutions and gold losses and are reported as delivered to the mill.
Metallurgical recovery factors have not been applied to the reserve
figures.
Aflease Gold Audited Resources (Dec 07)
Tonnes Gold Grade Gold Content
(Mt) (g/t) (Moz)
Indicated
Modder East 28.83 2.84 2.63
Sub Nigel 1,2,3 2.98 3.21 0.31
Total Indicated 31.81 2.87 2.94
Inferred
Modder East 14.98 2.16 1.04
Sub Nigel 1,2,3 2.92 4.46 0.42
Sub Nigel 6 83.37 3.77 10.11
Turnbridge/New 4.27 6.05 0.83
Kleinfontein
Ventersburg 30.52 4.74 4.65
Total Inferred 136.06 3.90 17.05
Notes:
1. The mineral resources have been reported in accordance with the
classification criteria of the SAMREC Code and the CIM standards of
Canadian National Instrument 43-101.
2. The Modder East, Sub Nigel 1, 2,3 and Turnbridge/New Kleinfontein resources
were audited by SRK Consulting.
3. The Sub Nigel 6 and Ventersburg Resources were audited by Snowden.
4. Mineral reserves are included in mineral resources
5. Mineral resources are not mineral reserves and do not have demonstrated
economic viability.
6. No cut-off was applied in determining the Ventersburg resource.
7. A cut-off of 300cmg/t was applied in determining the Sub Nigel 6 resource.
8. Snowden believes that the delineated target areas in respect of both Sub
Nigel 6 and Ventersburg have the potential to change significantly as new
data is acquired and this may well impact negatively on the current Mineral
Resource estimate given the erratic distribution and deposition of the reef
types.
Additional Listing and Capital Position
Aflease Gold has initiated a process to become listed on an internationally
recognized North American or European stock exchange within a year. This
initiative underpins the company`s medium-term strategy of becoming a mid-tier
gold producer with an international developed capital markets profile.
With the closing of its convertible bond issue in December 2007, Aflease Gold
has a strong working capital position and development of the Modder East project
is fully funded.
Modder East Gold Project
Aflease Gold continues to make good progress on the development of its Modder
East project, situated approximately 30 kilometres east of Johannesburg, South
Africa.
The first gold pour remains on schedule for Q3 2009, with a minimum 8 year life
of mine.
The trackless decline development has advanced a total of approximately 1,500
metres to date and a dedicated return airway has been established from 210
metres below collar to surface.
Aflease Gold received approval for an amended environmental management programme
from the Department of Minerals and Energy in Q4 2007. Upon receipt of this
approval, the company commenced the sinking of the vertical shaft and the
construction of the processing plant.
The vertical shaft, which will be 345 metres deep when complete, will connect to
the decline currently under development and will provide the primary access for
employees to the underground workings and will be utilised for ventilation
purposes. The shaft is being constructed by Grinaker-LTA and is expected to be
completed in the second half of 2008.
The vertical shaft will be completed before being connected to the decline.
This will enhance flexibility for the ramp up of production by having more
infrastructure development in place by the time that the main decline connects
with the shaft bottom.
Construction of the 100,000 tonne per month processing plant commenced in Q4
2007 and is expected to be completed at the end of Q1 2009, within the budgeted
amount.
No additional resource delineation drilling is planned at Modder East for 2008.
The company is planning on further exploring the UK9A reef utilising on-reef
development perpendicular to the payshoot direction. This exploration is
expected to delineate the channels and payshoots present in the UK9A reef and
delineate higher grade areas of the deposit.
Ventersburg Project
Aflease Gold is also pleased to announce a new inferred mineral resource
estimate for its Ventersburg project, located approximately 25 kilometres
southeast of Welkom in the Free State Goldfields. The Ventersburg lease covers
an area of approximately 9,760 hectares and is located 18km from Harmony Gold
Mine # 2 shaft and 25 km east of President Steyn Gold Mine # 2 shaft, both of
which are currently mining the `A` Reef.
The table below shows the updated resource for Ventersburg as prepared by
Minexcon.
Ventersburg Audited Resources (Dec 07)
Tonnes Gold Grade Gold Content
(Mt) (g/t) (Moz)
Inferred
`A` Reef 30.52 4.74 4.65
Notes:
1. No cut-off was applied in determining the resource inasmuch as the target
area of the ore body is situated in a well-defined payshoot.
Historically, a total of 77 boreholes have been drilled at the Ventersburg
project by previous owners, including Gold Fields and Harmony Gold. Forty-nine
of the 77 boreholes were drilled in the northern portion of the project area.
Of these, 32 holes (65%) intersected the `A` Reef (equivalent to the UK9A
Kimberley Reef elsewhere in the Witwatersrand Basin). Drill hole spacing ranged
from 500 metres to in excess of 1,000 metres. As a result, additional
delineation drilling, targeting the `A` Reef in the northern portion of the
prospect area, was considered justified. Most of the `A` Reef intercepts within
the northern area of interest occurred at depths ranging from 529 metres to 856
metres below surface. The Leader Reef is situated approximately 100 metres
below the `A` Reef and is poorly developed.
In 2004, Aflease Gold drilled a successful hole (WT1), which intersected the `A`
Reef at a depth of 970 metres below surface. The intercept graded at 4.78g/t
gold over 137.2cm for a content of 656cmg/t.
A diamond drilling program commenced in May 2007 to establish continuity of the
reef horizon as well as the economic feasibility of the `A` Reef. Results of
this ongoing drilling programme have not been included in the new inferred
mineral resource estimate at Ventersburg and the resource potential of the `A`
Reef will be evaluated upon completion of this drilling programme. The company
currently has 5 drilling rigs on the property working on the drilling programme.
In Q4 2007, Aflease Gold was granted a new prospecting permit covering 2,800
hectares adjacent to the company`s existing Ventersburg project. The company
plans on assessing the potential of the new prospecting area, to be known as
Ventersburg 2, during 2008.
Sub Nigel 6 Project
The Big Pebble Marker prospect and the Area 6 Nigel Reef prospect are both
located on the western extension of Vlakfontein Gold Mine in the Nigel
Magisterial district. Both projects are located on the Vlakfontein No. 4 shaft
(previously West Vlakfontein No. 1 shaft) property. The Big Pebble Marker
(Kimberly Reef) occurs approximately 300 m above the Nigel Reef.
The resource estimation is based on work prepared by Camden Geo Services,
utilising historical borehole and assay data from the 2000 metre decline on-reef
development and 600 metre incline on-reef development. The resource lies between
2000 and 2600 metres below surface and is divorced from the flooded East Rand
Basin as a plug has been constructed between the West Vlakfontein decline and
adjacent mine.
A vertical shaft down to 2000 metres below surface exists on the property.
Aflease Gold has commenced investigation into the infrastructure necessary to
commission the shaft.
Tonnes Grade Gold Content
(Mt) (g/t) (Moz)
Inferred
Big Pebble 15.10 5.89 2.77
Marker
Nigel Reef 68.27 3.34 7.34
Total Inferred 83.37 3.77 10.11
Notes:
1. A cut-of of 300cmg/t was applied in determining the resource which is
consistent with what the major Witwatersrand mining houses have
historically applied and a certain degree of selective mining may be
required.
Bothaville Prospecting Right
During Q4 2007, Aflease Gold was granted a new prospecting right covering 8,500
hectares in the Bothaville district of the Free State province, approximately 25
kilometres east of the town of Bothaville.
The Bothaville prospect is geologically similar to the company`s Ventersburg
project. The target consists of a relatively shallow horst block which Aflease
Gold believes has good potential to define economic reef horizons, namely the
`A` and Leader Reefs. The `A` and Leader reefs are typical of highly-
channelised conglomerates. Rand Mines drilled approximately 30 diamond drill
holes in the area over a 50km2 extent between 1981 and 1983.
Aflease Gold believes the Bothaville prospecting area has the potential for a
multi-million ounce in situ deposit. Should initial prospecting delineate higher
grade zones within the target area, then the opportunity exists to test the down
dip potential of the mineralized zone to the south.
Update on Trinity Share Swap
The share swap arrangement with Trinity Asset Management (Pty) Ltd. originally
announced on 23 June 2006 was subject to a number of conditions precedent
including the settlement of the claims between JCI and Randgold. To date, the
conditions precedent have not been fulfilled and it is unknown when and if they
would ever be fulfilled. Under the circumstances, the share swap agreement has
been cancelled by mutual agreement
About Aflease Gold
Aflease Gold is a South African gold resource company listed on the JSE Limited
(the Johannesburg stock exchange). The company owns the Modder East Gold
Project, currently under construction, as well as the Sub Nigel, New
Kleinfontein, Turnbridge and the Holfontein Gold Projects, all on the East Rand;
the Ventersburg Gold Project in the Free State gold field; and the Etendeka Gold
Project in Namibia. Aflease Gold was formed in January 2006 through the reverse
takeover of Sub Nigel Gold Mining Company by New Kleinfontein Mining Company,
then a wholly-owned subsidiary of Uranium One Inc. The company is currently
owned as to approximately 70% by Uranium One Inc and has a market capitalization
of approximately R1.4 billion.
For further information, please contact:
Jean Nortier Izak Marais
Chief Financial Officer Chief Operating Officer
Aflease Gold Limited Aflease Gold Limited
Tel +27 11 482-3605 Tel + 27 11 814-4290
Cautionary Statement
This News Release includes certain "forward-looking statements" and "forward-
looking information". All statements other than statements of historical fact
included in this release including, without limitation, statements regarding
future plans and objectives of Aflease Gold are forward-looking statements (or
forward-looking information) that involve various risks and uncertainties. There
can be no assurance that such statements will prove to be accurate and actual
results and future events could differ materially from those anticipated in such
statements. Important factors could cause actual results to differ materially
from Aflease Gold`s expectations. Such factors include, among others, the actual
results of exploration activities, actual results of reclamation activities, the
estimation or realization of mineral reserves and resources, the timing and
amount of estimated future production, costs of production, capital
expenditures, costs and timing of the development of Modder East and new
deposits, availability of capital required to place Aflease Gold`s properties
into production, the ability to obtain a listing in Europe or North America,
conclusions of economic evaluations, changes in project parameters as plans
continue to be refined, future prices of gold and other commodities, possible
variations in ore grade or recovery rates, failure of plant, equipment or
processes to operate as anticipated, accidents, labour disputes and other risks
of the mining industry, delays in obtaining governmental approvals, permits or
financing or in the completion of development or construction activities,
Aflease Gold`s hedging practices, currency fluctuations, title disputes or
claims limitations on insurance coverage, Although Aflease Gold has attempted to
identify important factors that could cause actual results to differ materially,
there may be other factors that cause results not to be as anticipated,
estimated or intended.
There can be no assurance that such statements will prove to be accurate as
actual results and future events could differ materially from those anticipated
in such statements. Accordingly, readers should not place undue reliance on
forward-looking statements. Aflease Gold does not undertake to update any
forward-looking statements that are included herein, except in accordance with
applicable securities laws.
In addition, this news release uses the terms "indicated resources" and
"inferred resources" as defined in accordance with the SAMREC Code (South
African Code for Reporting of Mineral Resources and Mineral Reserves prepared by
the South African Mineral Resource Committee) (SAMREC) under the auspices of the
South African Institute of Mining and Metallurgy effective March 2000 or as
amended from time to time.
A mineral reserve is the economically mineable part of a measured or indicated
resource demonstrated by at least a preliminary feasibility study. This study
must include adequate information on mining, processing, metallurgical, economic
and other relevant factors that demonstrate at the time of reporting that
economic extraction can be justified. A mineral reserve includes diluting
materials and allows for losses that may occur when the material is mined. A
proven mineral reserve is the economically mineable part of a measured resource
for which quantity, grade or quality, densities, shape and physical
characteristics are so well established that they can be estimated with
confidence sufficient to allow the appropriate application of technical and
economic parameters to support production planning and evaluation of the
economic viability of the deposit. A probable mineral reserve is the
economically mineable part of an indicated mineral resource for which quantity,
grade or quality, densities, shape and physical characteristics can be estimated
with a level of confidence sufficient to allow the appropriate application of
technical and economic parameters to support mine planning and evaluation of the
economic viability of the deposit.
A mineral resource is a concentration or occurrence of natural, solid, inorganic
or fossilized organic material in or on the earth`s crust in such form and
quantity and of such a grade or quality that it has reasonable prospects for
economic extraction. The location, quantity, grade, geological characteristics
and continuity of a mineral resource are known, estimated or interpreted from
specific geological evidence and knowledge. A measured mineral resource is that
part of a mineral resource for which quantity, grade or quality, densities,
shape and physical characteristics can be estimated with a level of confidence
sufficient to allow the appropriate application of technical and economic
parameters to support mine planning and evaluation of the economic viability of
the deposit. The estimate is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill holes that are
spaced closely enough to confirm both geological and grade continuity. An
indicated mineral resource is that part of a mineral resource for which
quantity, grade or quality, densities, shape and physical characteristics can be
estimated with a level of confidence sufficient to allow the appropriate
application of technical and economic parameters to support mine planning and
evaluation of the economic viability of the deposit. The estimate is based on
detailed and reliable exploration and testing information gathered through
appropriate techniques from locations such as outcrops, trenches, pits, workings
and drill holes that are spaced closely enough for geological and grade
continuity to be reasonably assumed. An inferred mineral resource is that part
of a mineral resource for which quantity and grade or quality can be estimated
on the basis of geological evidence and limited sampling and reasonably assumed,
but not verified, geological and grade continuity. The estimate is based on
limited exploration and sampling gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill holes. Mineral
resources which are not mineral reserves do not have demonstrated economic
viability. Investors are cautioned not to assume that all or any part of the
mineral deposits in the measured and indicated resource categories will ever be
converted into reserves. In addition, "inferred resources" have a great amount
of uncertainty as to their existence and economic and legal feasibility. It
cannot be assumed that all or any part of an inferred mineral resource will be
ever be upgraded to a higher category. Under South African rules, estimates of
inferred mineral resources may not form the basis of feasibility or pre-
feasibility studies or economic studies except under conditions noted in the
SAMREC Code.
Investors are cautioned not to assume that all or any part of an inferred
resource exists or is economically or legally mineable. Exploration data is
acquired by the Corporation and its consultants under strict quality assurance
and quality control protocols.
No stock exchange, securities commission or other regulatory authority has
approved or disapproved the information contained herein.
February 4, 2008
Date: 04/02/2008 11:17:04 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
