| Thu 4 Jun 2009, 7:05 | | GDO - Gold One International Limited - Gold One Provides Strategic and |
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GDO
GDO
GDO - Gold One International Limited - Gold One Provides Strategic and
Operational Update
Gold One International Limited
(Previously BMA Gold Limited)
(Incorporated in Australia)
(ACN: 094 265 746)
(Registered in South Africa as an external company)
(Registration number 2009/000032/10)
Share code on the JSE: GDO
ISIN: AU000000GDO5
("Gold One" or the "company")
GOLD ONE PROVIDES STRATEGIC AND OPERATIONAL UPDATE
Gold One is pleased to provide the following strategic and operational update.
Highlights:
- Successful dual listing of Gold One on both the ASX Limited ("ASX") and JSE
Limited ("JSE")
- Recent capital raising has resulted in the Modder East project being fully
funded
- Sampling results from the BPLZ reef exposed through current reef
development delivered grades consistent with DD01, thereby increasing
confidence in the geological model.
- Modder East processing plant enters the commissioning phase with the
introduction of waste rock feed into the crushing and milling circuit
- Sub Nigel #1 shaft and 17 level fully recommissioned and training centre
newly established with production build up progressing well
"Our company continues to achieve significant milestones, all of which are major
building blocks to ensure the successful completion of our flagship Modder East
operation. The listing of Gold One, on Monday 18 May 2009, signalled three years
to the day since the initial sod-turning took place at Modder East, while only
last week we completed construction of the main components of our metallurgical
plant and moved the first rock through the crushing and milling system" said
Gold One President and CEO Neal Froneman. "Despite the tough economic times we
have managed to secure funding to complete the development of the mine - it is
testament to the solid fundamentals of our project that we managed to secure
funding, in time and at very good prices, thus providing certainty and comfort
to the operational team" added Froneman.
Strategic Update:
The creation of Gold One and the subsequent reinstatement of the company`s
securities to quotation on the ASX and listing on the JSE was a significant step
in the development of the company and was extensively supported by shareholders
of both Gold One, previously known as BMA Gold Limited, and Aflease Gold Limited
("Aflease").
Since the listing, the share price of the company on the ASX has nearly doubled
from the pre-suspension levels of Gold One of AUS$0.22 to close at AUS$0.42 on
Friday 29 May 2009, while on the JSE, the share has started to rerate in line
with the company`s strategy of achieving a premium market rating. The company
believes that value accretive geographical diversification is also key to
managing risk and in line with this strategy will continue to review
opportunities in our targeted destinations of Australia, North America and
Southern Africa.
During the period since the announcement of the proposed inward listing of Gold
One on the JSE and the subsequent acquisition by Gold One of all the issued
ordinary shares in Aflease by way of a scheme of arrangement, Aflease has been
actively seeking capital to ensure that the Modder East project is fully funded
to first gold pour. Aflease announced in November 2008, that it still required
US$ 15 million (R120 million, AUS$ 18 million) to complete the project. In
early May, Aflease announced that through an innovative share swap transaction
with Trinity Asset Management (Pty) Limited, it had raised US$ 10 million (R89
million, AUS$ 13.5 million)* while it also managed to secure an additional US$
5.3 million (R44 million, AUS$ 6.6 million)* and US$ 4 million (R33 million,
AUS$ 5.3 million) in two separate tranches through placements of shares with
institutions and individuals in the United States, Europe, the Far East and
Australia. Following these successful capital raisings the new combined entity
- Gold One - has as at 22 May 2009 a cash balance of US$ 24 million (R200
million, AUS$ 30 million)*.
The unconditional approval of the merger between BMA Gold and Aflease brought
with it a new board and company secretary for Gold One International. "We have
put together a board that is reflective of the new company`s strategy and
philosophy and brings together a broad range of skills, as well as years of
industry experience" commented Neal Froneman "Experience is something you cannot
buy, and as we progress down our growth path, their knowledge and counsel will
be invaluable to the company. I would like to thank the outgoing directors of
Aflease and BMA, for their support and vision in making this deal a possibility"
added Froneman.
The new board is now constituted as follows:
- NJ Froneman (President and Chief Executive Officer)
- CD Chadwick (Chief Financial Officer)
- MK Wheatley (non-executive Chairman)
- BE Davison (non-executive Director)
- KV Dicks (non-executive Director)
- W Harris (non-executive Director)
- S Swana (non-executive Director)
- KJ Winters (non-executive Director)
Pierre Kruger will act as the Company Secretary of Gold One following the
resignation of Ken Winters. A brief summary of the experience of key members of
the executive is set out below:
- NJ Froneman (President and Chief Executive Officer)
- Neal is a registered professional engineer with over 25 years`
experience in the mining industry. Prior to joining Aflease, he was
CEO of Uranium One, vice president and head of operations at
Goldfields Limited, and has also held management and executive
positions at Harmony Gold Mining Company, JCI and other companies.
- CD Chadwick (Chief Financial Officer)
- Christopher is a qualified Chartered Accountant. Prior to joining
Aflease in July 2008, Christopher has held executive positions in a
wide range of industries, both with local South African companies and
multinationals.
- PB Kruger (Company Secretary and executive member)
- Pierre served as non-executive director of Aflease prior to taking up
the role of legal counsel and company secretary in January 2007.
Pierre was formerly non-executive chairman of New Kleinfontein Mining
Company Limited. Pierre practised with Charles Sherman, Kruger and
Prosser Inc for 26 years as an attorney, notary public and conveyancer
- IJ Marais (COO and executive member)
Izak has over 15 years` experience in various management roles in the
South African mining industry, working in various deep and shallow
gold mines belonging to the Gencor Limited and Gold Fields Limited
groups. Prior to joining Aflease, Izak served as Managing Director
and CEO of Sallies Limited, a junior miner with open cast operations
Operational Update:
1. Modder East Gold Project
- Access Development
Development of the Return Airway, which is on the critical path to reef
intersection, has advanced as scheduled to intersect the Buckshot Pyrite Leader
Zone ("BPLZ") reef at the expected elevation, while the first reef development
commenced as scheduled in April. This reef intersection took place some 14
meters away from DD01, the first original surface diamond drill hole, and
exactly on the elevation as projected from DD01.
Sampling results from the BPLZ reef exposed through current reef development
delivered grades consistent with DD01, thereby increasing confidence in the
geological model. These sample sections have been taken using trained samplers
(with extensive experience of sampling the BPLZ zone) using the Gold One
prescribed sampling code of practice, sampling both sides of the development
using a 3m by 3m sampling grid. All samples were analyzed by Harold Cole of the
onsite, independent Ready Lead Laboratories. The laboratory presently keeps all
records of their QAQC procedures.
Cover drilling in the decline has reverted to long hole cover, and the first
hole was drilled to final depth (80m) without intersecting water. Cover drilling
operations in the Decline West, have continued on full face cover due to the
intersection of a gold bearing erosion channel. There is no change to the long
term philosophy of long hole cover drilling from cubbies alongside the
development ends.
The trackless decline has now advanced a total of nearly 2100 metres since the
start of the project and development of the first footwall crosscut started at
the end of May. Once the footwall crosscut is established, the decline will
continue to be developed to intersect the station development around the
vertical shaft, from where development continues to access the Kimberly Reef
elevation some 360m vertically below surface, through the continuing of
development at 9.5 degrees below the horizontal.
The Decline West, started in June 2008 to provide contingency and flexibility
has continued to advance well, and is only 30m away from the BPLZ footwall drive
elevation.
- Wide Reef Resource
The company continues to explore the possibility of mining the much wider reefs
of the blanket and channel facies, dubbed the Widereefs, by means of trackless
mining methods. This is in line with interpretation of drillhole DD01 that
showed the possibility of mining the blanket and channel facies below the BPLZ,
while reef intersections as a result of the Return Airway ("RAW") development
have confirmed initial interpretations. The first raise line is designed to
expose the full extent of the reef package, which will then be sampled and
modeled. The blanket and channel facies are positioned just below the BPLZ and
can therefore be accessed from existing footwall development
The company has tasked Mining and Exploration consultants Minxcon to undertake
an extensive study to confirm the feasibility of this project and a final
decision on this project will be made once a representative underground sample
is obtained from the RAW raise development.
- Vertical Shaft
Commissioning of the 345m deep vertical shaft - designed for primary personnel
access and downcast ventilation - is scheduled to be completed in October 2009.
The shaft has been sunk to a depth of 325m and the excavations of the BPLZ
station levels both to the north and the south have been completed to a distance
of 20m from the shaft centre. Equipping will commence once shaft sinking is
completed. The permanent headgear and winder house is currently being assembled
on site and will be placed in a single lift onto its permanent foundations above
the vertical shaft after equipping is complete in October. The installation of
the Koepe winder in the winder house is 75% completed, with mainly electrical
work outstanding and will be ready to be commissioned once the headgear has been
erected.
- Metallurgical Processing Plant and Tailings Disposal Facility
Commissioning of the processing plant is well advanced; the crushing circuit has
been hot commissioned while the milling, thickening and Carbon-in-leach (CIL)
circuits have been cold commissioned in stages over the past few weeks.
The company is also pleased to announce that it has secured approximately 150
000 tonnes of relatively low grade material (
1g/t) ex-surface stockpile, with
which to start up the plant and to test the functionality of the various
circuits. This is of particular significance, since it enables the metallurgical
teams to establish the integrity of the circuit before processing of the higher
grade Modder East material which starts later this year. Milling of this low
grade material commenced towards the end of May and the entire milling of this
stockpile will be completed by end August
The processing of the medium grade Sub Nigel stockpile will only take place
after the low grade material has been processed, thereby optimizing the expected
recovery from the Sub Nigel material. At the end of May, a total of just over
9000 tons of Sub Nigel ore was stockpiled at Modder East.
The CIL circuit is currently being hot commissioned, and the first carbon
addition is planned for the week starting 8 June 2009. The elution circuit is on
track to receive loaded carbon from the CIL circuit by the middle of June, when
the first loaded carbon from the processing of low grade material will be ready.
Smelthouse construction is on schedule for completion mid June. The tailings
disposal facility is fast nearing completion and will be ready to receive its
first tailings when required, thereby completing the commissioning phase of the
processing plant.
Background information on Modder East can be obtained from the SRK Competent
Person`s Report dated October 2008 contained in the pre-listing statement issued
on 19 December 2008, a report titled An Independent Technical Report on the
Modder East Gold Project, located near Springs, Gauteng Province, Republic of
South Africa dated August 31, 2006 as amended October 26, 2006 compiled by SRK
Consulting and a Securities Exchange News Service (SENS) announcement titled
Aflease Gold Announces Enlarged 180 000 Oz Per Annum Modder East Gold Project
released on 3 October 2007. Both the reports and the announcement can be
accessed via the Gold One website (www.gold1.co.za).
2. Sub Nigel 1 Project
- Phase 1
On 18 June 2008 the Board approved the first phase of the re-commissioning of
Sub Nigel at a capital cost of US$ 3.4 million (R28.9 million, AUS$ 4.3 million)
after a detailed study showed a reasonable return for a relatively small
investment in infrastructure.
The project utilizes the current infrastructure at Sub Nigel which is in
excellent condition and allows for access to the stoping areas from existing
development. The ore from Sub Nigel will initially be processed through the
Modder East plant which will have excess capacity until the latter reaches full
production in 2011.
The recommissioning project was officially completed on 27 January 2009, when
the first ore was hoisted with a saving of approximately R5 million of the
budgeted cost. The mine is now in production ramp up phase, to be completed by
the end of June.
Management has established all training philosophies, and all underground
classrooms have been commissioned. Teams are responding better than anticipated
to the hydropower training, which bodes well for the buildup at Modder East.
The commissioning of the micro Hydropower pump-station (the same as those that
will be used at Modder East) was successfully completed. A number of learning
experiences, which will greatly benefit Modder East, were part of the process.
Production ramp up, once completed will produce 6000 ounces of gold per annum at
a steady state cash cost of ZAR138,000 per kilogram (US$517/oz, AUS$ 652/oz).
3. Exploration
The company has taken cognisance of the current financial markets and trimmed
its exploration strategy and subsequent exploration expenditure to suit. The
company is, however, continuing with work on the Ventersburg project. As
reported previously, this project now comprises a SAMREC/JORC and CI 43-101
compliant indicated resource of 8.73 million tonnes at a grade of 5.12g/t for
1.437million ounces using a cut-off of 400cmg/t and an inferred resource of
13.48Mt at a grade of 4.24g/t for 1.84 million ounces The company is aiming to
start a pre-feasibility study on this project in 2010.
*All currency exchanges were done at R8.30/US$ and R6.58/AUS$
ENDS -
Issued by Gold One International Limited
Website: www.gold1.co.za
For further information contact:
Neal Froneman Ilja Graulich Carol Smith
President and CEO VP: Corporate Affairs Investor Relations
+27 11 726 1047 +27 11 726 1047 +27 11 726 1047
(office) (office) (office)
+27 83 628 0226 +27 83 604 0820 +27 82 338 2228
(mobile) (mobile) (mobile)
neal.froneman@gold1.co. ilja.graulich@gold1.co. carol.smith@gold1.co.
za za za
Note to editors:
Gold One International Limited is an Australian and African gold resource
company listed on the financial markets operated by ASX Limited (the Australian
Securities Exchange) and JSE Limited (the Johannesburg Stock Exchange) (issuer
code GDO). It is developing the new Modder East mine on the East Rand, some 30
kilometres from Johannesburg, and also owns the nearby existing Sub Nigel mine,
which has recently been recommissioned. Its other projects and targets include
Ventersburg, a large project with indicated resources of 1.43million ounces, and
Bothaville, both in the Free State Goldfields, the Tulo concession in Mozambique
and the Etendeka greenfields project in Namibia as well as exploration assets in
Australia. It has an indicated and inferred resource base of some 13 million
ounces of gold.
This News Release does not constitute investment advice. Neither this News
Release nor the information contained in it constitutes an offer, invitation,
solicitation or recommendation in relation to the purchase or sale of securities
in any jurisdiction.
COMPETENT PERSON
The information in this report that relates to exploration results, mineral
resources or ore reserves is based on information compiled by Piet van Straaten,
B.Sc., Pr.Sci.Nat., Vice President, Geology and Exploration, Gold One, who is a
Member or Fellow of the SAIMM. Piet van Straaten is a full-time employee of Gold
One. Piet van Straaten has 25 years experience which is relevant to the style of
mineralization and type of deposit under consideration and to the activity which
he is undertaking, to qualify as a Competent Person for the purposes of both the
2004 Edition of the `Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves` and the `South African Code for Reporting of
Mineral Resources and Mineral Reserves`. Piet van Straaten consents to the
inclusion in this News Release of the matters based on information compiled by
him in the form and context in which they appear.
Further information on the company`s resource statement is available in the pre-
listing statement of Gold One International Limited issued on 19 December 2008.
FORWARD-LOOKING 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 Gold One are forward-looking statements (or
forward-looking information) that involve various risks, assumptions and
uncertainties. There can be no assurance that such statements will prove to be
accurate and actual values, results and future events could differ materially
from those anticipated in such statements. Important factors could cause actual
results to differ materially from Gold One`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 Gold One`s
properties into production, the ability to obtain or maintain a listing in South
Africa, Australia, 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, political risks, permits or financing or in the
completion of development or construction activities, economic and financial
market conditions, Gold one`s hedging practices, currency fluctuations, title
disputes or claims limitations on insurance coverage. Although Gold One 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.
Any forward-looking statements in this News Release speak only at the time of
issue. There can be no assurance that such statements will prove to be accurate
as actual values, results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place undue
reliance on forward-looking statements. Gold One does not undertake to update
any forward-looking statements that are included herein, or revise any changes
in events, conditions or circumstances on which any such statement is based,
except in accordance with applicable securities laws and stock exchange listing
requirements.
SAMREC and JORC TERMINOLOGY
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 and where indicated in accordance with the Canadian
National Instrument 43-101 - Standards for Disclosure for Mineral Projects. The
terms "indicated resources" and "inferred resources" are also defined in the
2004 Edition of the JORC Code (Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves) prepared by the Joint Ore Reserves
Committee of The Australasian Institute of Mining and Metallurgy, Australian
Institute of Geoscientists and Minerals Council of Australia (JORC). The use of
these terms in this News Release is consistent with the definitions of both the
SAMREC Code and the JORC Code.
A mineral reserve (or ore reserve in the JORC Code) 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 (or proved ore
reserve in the JORC Code) 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 (or probable ore
reserve in the JORC Code) 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 and Australian
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 and the JORC Code, respectively
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.
Date: 04/06/2009 07:05:02 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.
