| Wed 2 Dec 2009, 7:26 | | GDO - Gold One Declares Commercial And Continuous Production At Modder East And |
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GDO
GDO
GDO - Gold One Declares Commercial And Continuous Production At Modder East And
Provides Production Guidance For 2009 And 2010
Gold One International Limited
(Previously BMA Gold Limited)
Registered in Western Australia under the Corporations Act, 2001 (Cth)
Registration number ACN: 094 265 746
Registered as an external company in the Republic of South Africa
Registration number: 2009/000032/10
Share code on the ASX/JSE: GDO
ISIN: AU000000GDO5
OTCQX International: GLDZY
("Gold One" or the "company")
GOLD ONE DECLARES COMMERCIAL AND CONTINUOUS PRODUCTION AT MODDER EAST AND
PROVIDES PRODUCTION GUIDANCE FOR 2009 AND 2010
- Maiden operating profit for the Modder East project
- Commercial and continuous production declared at Modder East Gold Mine
- Gold One provides production guidance for 2009 and 2010
Gold One is pleased to advise that during the month of November 2009 gold
production from the flagship Modder East operation resulted in the maiden
month`s operating profit for the project. Gold One anticipates that this trend
will continue as production continues to increase. Further, both commercial and
continuous production have now been declared, effective Monday, 1 December 2009.
The move into commercial production is important from an accounting perspective
as both revenue and operating costs will now be declared. Gold One has a number
of criteria that have been used to determine the point at which commercial
production is achieved. The board of Gold One, in consultation with its
auditors PricewaterhouseCoopers, believes that all of these criteria have been
satisfactorily met and commercial production has thus been declared.
The announcement of commercial production follows on from a successful
commissioning of both the mine and the newly built metallurgical plant, which
saw first gold poured on 21 July 2009 from underground ore. To date a total of
11,041 ounces of gold have been produced with cash on the balance sheet of
A$ 17 million (ZAR 117.3 million*). All components of the project are operating
well and in many cases exceeding the design parameters. The grade and plant
recoveries continue to exceed both the geological block model and metallurgical
feasibility test work, respectively. Production ramp-up has increased to
approximately 1,000 tonnes per day which is the equivalent of a milling rate of
around 30,000 tonnes of ore a month. This throughput is approximately 43 per
cent of the targeted monthly throughput required by the end of 2010 providing
significant confidence in the guidance below
In addition to declaring commercial production, Gold One is pleased to confirm
that continuous production has also been achieved. The achievement of continuous
production is one of the conditions applicable to the US$ 71.6 million five year
convertible bonds due December 2012. The terms and conditions provided that
unless continuous production was achieved on or before 31 March 2010, the
conversion price would have been reset in favour of the bondholders.
GUIDANCE FOR 2009 AND 2010
Forecasted gold production for calendar year 2009 is now expected to be between
16,000 and 20,000 ounces. The range in the forecast is driven by a number of
panels coming into production approximately two weeks later than planned with
the net result that the ore from these panels will be treated later in December
2009 and therefore may not report as physical gold during December 2009, but
will rather be gold in system. The volume build-up on these panels is
continuing smoothly.
Gold One has just completed its annual planning and budgeting process. The
budgets incorporate the most recent mining and metallurgical factors and for
calendar 2010 gold production is estimated to be between 100,000 and 120,000
ounces at average cash costs for 2010 of US$ 330 per ounce.
Forecast production for calendar 2011 remains unchanged at 180,000 ounces at an
average cash cost of US$ 250 per ounce.
Commenting on the declaration of commercial and continuous production, Gold One
President and CEO Neal Froneman stated "It gives me great pleasure to announce
these significant milestones in the development of our Modder East mine. I am
extremely pleased that only six months after the first reef intersection, the
mine has produced sufficient gold during November 2009 to result in an operating
profit for the month. This is a great tribute to the quality of the Modder East
gold resource and I wish to thank all those involved for their hard work in
developing this wonderful project."
*A$/ZAR exchange rate of 6.90
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 (office) +27 11 726 1047 (office) +27 11 726 1047 (office)
+27 83 628 0226 (mobile) +27 83 604 0820 (mobile) +27 82 338 2228 (mobile)
neal.froneman@gold1.co.za ilja.graulich@gold1.co.za carol.smith@gold1.co.za
Parktown, Johannesburg
2 December 2009
Sponsor
Macquarie First South Advisers (Pty) Limited
About Gold One:
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 Securities 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 and Bothaville, both in the Free State goldfields,
the Tulo concession in Mozambique and the Etendeka greenfields project in
Namibia.
Date: 02/12/2009 07:26:01 Produced by the JSE SENS Department.
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