| Wed 27 Jan 2010, 8:41 | | GDO - Gold One International - Quarterly Activities Report for the Quarter Ended |
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GDO
GDO
GDO - Gold One International - Quarterly Activities Report for the Quarter Ended
31 December 2009
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")
QUARTERLY ACTIVITIES REPORT FOR THE QUARTER ENDED 31 DECEMBER 2009
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
December quarter highlights:
- Good safety performance continues with a progressive lost time injury
frequency rate of 1.14 per 200,000 hours for 2009
- Gold One becomes cash flow positive in December 2009
- A 75 per cent increase in gold production with 10,865 ounces produced for
the quarter
- Cash costs of US$593 per ounce which is better than previous guidance of
US$640 per ounce
- Commercial and continuous production declared on 1 December 2009 at Modder
East Gold Mine
- Average recovered grade increases by 115 per cent from 3.20 grams per tonne
to 6.88 grams per tonne
- Modder East gold plant continues to achieve recoveries of 92 per cent
- 2009 gold production of 17,040 ounces in line with previous production
guidance
1 CHIEF EXECUTIVE OFFICER`S REVIEW
Gold One`s Modder East ramp-up has continued to progress well during the
December 2009 quarter, and I am delighted to advise that in line with our market
guidance, 17,040 ounces of gold were produced in 2009, of which 10,865 ounces
were produced in the December quarter. Modder East produced 5,193 ounces of
gold in December 2009, which at this stage of build up would represent over
62,000 ounces of annualised production which positions Gold One well to achieve
its stated production targets for 2010 of 100,000 ounces.
In addition, both commercial and continuous production were declared on 1
December 2009 resulting in the average cash cost for December 2009 coming in
ahead of expectations at US$593 per ounce. These costs include the full cost of
the Sub Nigel training centre, and while only measured over one month, are
nevertheless better than previous guidance of US$640 per ounce.
A total of 625 metres of on- and off-reef development took place during the
quarter under review. The quality of the orebody continues to be reflected in
the grade and gold content of the on-reef development which exposed the Buckshot
Pyrite Leader Zone (BPLZ) reef at a grade of 1,602 centimetre grams per tonne
(8.57 grams per tonne over 187 centimetres) and Blanket Facies at a grade of 275
centimetre grams per tonne (1.21 grams per tonne over 227 centimetres). The
average grade mined increased by 137 per cent to 9.16 grams per tonne as mining
moved from lower grade on reef development and ledging to higher grade stoping
panels. The net result is that Modder East treated 46,661 tonnes, and the
recovered grade increased by 115 per cent from 3.20 grams per tonne to 6.88
grams per tonne during the December quarter.
It is most gratifying that all of the above operational results were achieved
with an excellent safety record and a progressive lost time injury frequency
rate (LTIFR) of 1.14 per 200,000 hours for 2009 which compares well with
Australian benchmarks.
Gold One experienced its maiden cash flow positive month in December 2009 before
the quarterly payment of interest on the convertible bonds. The company recorded
earnings before interest, taxes, depreciation and amortization (EBITDA) of
A$1.8m (ZAR12.2 million; US$1.6 million) in December 2009.
Gold One`s primary focus remains the delivery of production targets at Modder
East. Corporate activities at this stage are aimed at addressing the current
share price discount by improving trading liquidity, reviewing the balance sheet
structure and improving the company`s visibility.
The Australian Securities Exchange (ASX) has shown significantly higher
liquidity than the Johannesburg Stock Exchange (JSE) despite the fact that fewer
shares have until recently been listed on the ASX. A significant number of non
South African resident shareholders have transferred their shares from the JSE
share branch register to the ASX share branch register resulting in the
percentage of shares listed on the ASX increasing from 5 per cent at the dual
primary listing of Gold One to more than 50 per cent currently. Liquidity
remains strong in the ASX market and we plan to introduce the Gold One story to
even more investors in that region over the next few months.
Gold One is in the process of reviewing its balance sheet capital structure as
there is a clear overhang being caused by the once-off `put` option on 12
December 2010 that Gold One bondholders have, requiring the company to redeem
the convertible bonds. Notice of their intention to put their bonds needs to be
provided to the company 30 days in advance of the put date. Accordingly, we have
engaged Rothschild and based on proposals received, the board has agreed to
pursue the implementation of a debt facility to address any potential puts.
This process is well underway.
In the longer term we will continue to create value from our shallow, low risk
business model by exploring and developing our existing shallow assets.
December 2009 key performance data:
December 2009 quarter Modder East Modder surface Sub Nigel
Ore mined underground 47,469 - 13,751
Mined grade 9.16 0.66 1.68
Milled tonnes 46,661 8,193 11,940
Recovered grade 6.88 0.37 1.16
Plant recovery 93% 59% 92%
Gold produced 10,323 97 445
Cash operating cost US$593/oz
Gold sold 10,311 871
Average price received 1,113 1,113
(US$ / oz)
2 EXPLORATION UPDATE
2.1 Safety
Gold One achieved a LTIFR of 1.58 per 200,000 hours in December quarter. For
the 2009 year, the company managed to achieve an LTIFR of 1.14 per 200,000
hours, which is well in line with the Australian benchmark of 1 lost time injury
(LTI) per 200,000 hours worked. This safety performance significantly exceeds
the South African 2013 tripartite "Safety Targets and Milestones".
2.2 Modder East
2.2.1 Production
Total production for the group for the year was 17,040 ounces, of which 10,865
ounces were produced in the December quarter. Total gold production from Modder
East for 2009 was 15,199 ounces of gold, of which 10,323 ounces were produced in
the December quarter, a 112 per cent improvement on the previous quarter. This
is particularly encouraging given the mine ceased underground operations for the
Christmas and New Year holidays. During the Christmas and New Year period low
grade stockpiled development ore was treated resulting in 97 ounces of gold.
Modder East produced 5,193 ounces of gold in December 2009.
A breakdown of mined tonnages and grade as measured for the quarter is as
follows:
- A total of 46,661 tonnes were processed from Modder East at a recovered
grade of 6.88 grams per tonne for 10,323 ounces;
- 11,940 tonnes of ore from the Sub Nigel training centre were treated at a
recovered grade of 1.16 grams per tonne yielding 445 ounces; and
- In addition, a further 8,193 tonnes at a recovered grade of 0.37 grams per
tonne yielding 97 ounces of gold was fed to the crusher from the low grade
surface stockpile in December 2009.
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
Gold production from Modder East in November 2009 resulted in the maiden month`s
operating profit for the project. In the month of December 2009, the first
month of commercial production, operating profit was achieved with cash costs
recorded at US$593 per ounce (ZAR142,417 per kilogram; A$656 per ounce). A
decision was taken during the quarter to incorporate Sub Nigel as part of the
Modder East cost base given the importance of this training facility in the
build-up of Modder East. The costs of the Sub Nigel training centre have been
included in the Modder East cost numbers.
Gold One management has completed an analysis of the proposed three year, 35 per
cent annual electricity tariff increase by Eskom. Due to the shallow and
efficient mine design, the use of hydropower drilling and the use of truck
hoisting, electricity costs will only represent 7per cent of total operating
expenditure in 2010 rising to 9 per cent in 2012 of total operating expenditure.
Gold One`s exposure relative to the rest of the South African mining industry is
represented in the chart below. The chart assumes the original annual 45 per
cent hike proposed by Eskom, which has since been revised down to 35 per cent.
(Source: Deutsche Securities)
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
2.2.2 Ledging and stoping
Ledging (the phase of mining of ore prior to stoping operations) and stoping
continued with a total of 20 panels (25 metres in length) having been
established. The average face advance on stoping panels during the first three
months of full stoping was 12.8 metres per month, which compared favourably with
the start-up parameters of 14 metres face advance per month. This average face
advance is well ahead of South African industry standards and management is
confident that an average of 14 metres face advance can be achieved.
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
Stope widths continue to be in the region of 1 metre to 1.8 metres, depending on
the thickness of the reef. The stope width is closely monitored and optimal
stoping widths are determined from strike gulley development and the
interpretation of sampling results, obtained from above average sampling
frequencies.
The graph below tracks the blasted ledging and stoping grades to date. The
lower grades in the third quarter of 2009 reflect the higher stope widths
associated with ledging as opposed to stoping.
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
A second hydropower pump station has been commissioned. Reliability and
availability of the micro hydropower system continues to improve and the
original assessment that this system is far better suited for this type of
operation still holds. Blast hole drilling time is approximately half of that
of pneumatically powered drills.
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
2.2.3 Development
On-reef development metres for the quarter under review were 112 metres. The
average grade of the BPLZ facies over a channel width of 187 centimetres was
8.57 grams per tonne gold for a content of 1,602 centimetres grams per tonne.
The underlying Blanket Facies graded at 1.21 grams per tonne gold over a width
of 227centimetres for a content of 275 centimetres grams per tonne.
Total off-reef development metres over the same period were 487 metres. Footwall
development was concentrated in the decline and decline west area of the mine.
Footwall development is focused on accessing further raise lines and
establishing a holing with the BPLZ station of the vertical shaft, with less
than 100 metres left to complete this link-up.
Development in the decline has seen the establishment of the footwall
infrastructure on the BPLZ level and at the end of the quarter under review, had
reached the breakaway position of the underground workshop area.
The decline is also approximately 100 metres away from the position where the
decline will split into a twin end decline which will access the Kimberley reef
horizon. The first access point on the Kimberley Reef horizon is expected at an
elevation of 441 metres below surface, or 600 metres from the current decline
face position.
2.2.4 Vertical shaft
The 345 metre vertical shaft, which will be utilised primarily for
transportation of working teams to the operating faces, is now fully complete,
including all of the required equipping. Gold One has received all approvals,
including the sign-off to use the Koepe winder from the relevant authorities, to
commission the shaft for full usage. Once holing with the decline is complete,
all teams will use the shaft to access their working areas, reducing travel time
and resulting in an increase in face time, and hence productivity.
2.2.5 Modder East processing plant
The newly constructed metallurgical plant, commissioned in June 2009, continues
to operate ahead of specification with an average overall recovery from start-up
of 92 per cent. Operating costs for the plant for 2009 came in at ZAR194 per
tonne, which when adjusted for volume at this stage of build-up, are in line
with the bankable feasibility study costs of ZAR50 per tonne. Gold One
continues to work closely with a specialist consultancy to reduce the operating
costs even further by optimising chemical consumptions and improving plant
efficiencies.
Gold One has taken a decision to install a gravity circuit, at a total cost of
A$1.1 million (ZAR7.5 million; US$1 million). This follows on from the
completion of the test work aimed at establishing the feasibility of introducing
this gravity circuit into the metallurgical plant as reported on in the last
quarter. The gravity circuit will result in higher recoveries, reduced
operating costs and lower residence times while also reducing gold lock-up due
to the free-milling nature of the ore. This installation should be completed by
the end of May 2010.
2.3 Sub Nigel
The importance of Sub Nigel as a training facility has been demonstrated with
the solid start-up and high initial average face advances achieved at Modder
East. Sub Nigel has trained a total of 20 teams, each made up of nine team
members, with a further 80 people in training at year-end. The training centre
entrenches the basic principles of mining as well as allowing for the
development of coherent and well-functioning teams before the employees are
moved to Modder East. Sub Nigel`s costs are included as part of the Modder East
cost base. The training centre mined 38,729 tonnes at a grade of 2.03 gram per
tonne gold during 2009, producing 1,744 ounces of gold.
The training centre currently has seven panels available for training purposes
and is in the process of opening up more panels in higher grade areas.
3 EXPLORATION UPDATE
3.1 Ventersburg
The 2009 Ventersburg drilling program was completed in December 2009, with a
total of 12,814 metres drilled at the project. The exploration program will
continue in 2010 and modeling using available data is continuing. Drilling is
aimed at extending the current resource area as well as some infill drilling to
enhance confidence in the resource estimation. The first draft of a scoping
study report by Turgis Consulting (Turgis), who have been engaged to undertake
the pre-feasibility study, has been received and is being reviewed. Turgis was
the technical consultant to Gold One`s Modder East project from the scoping
study to the bankable feasibility study.
3.2 Tulo and Etendeka
Infrastructure development at Metangula continued during the December quarter,
ensuring that the establishment of a permanent exploration and development camp
will be complete in the current quarter.
At Etendeka, the company`s project in Namibia, Gold One presented an update to
the Namibian Department of Minerals, which was favourably received. Gold One is
pleased to report that its exploration permit has been extended until December
2010. During this time further analytical work will be carried out on the
project.
4 FINANCIAL REVIEW
In December 2009, Gold One produced A$6.8 million (ZAR46.5 million; US$6.2
million) in revenue, from gold sales of 5,617 ounces from the Modder East and
Sub Nigel projects.
The company moved into commercial production from 1 December 2009, and in its
first month of reporting operational results followed up November 2009`s project
profit with positive EBITDA of A$1.8 million (ZAR12.2 million; US$1.6 million)
at company level. The company delivered a positive cashflow for the month of
December 2009 before the payment of the quarterly bond interest.
The company wishes to re-emphasise that the achievement of continuous production
on 1 December 2009 was one of the conditions applicable to the US$71.6 million
five year convertible bonds due in 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 Gold One
bondholders. This provision has thus fallen away.
In its previous quarterly report, Gold One announced that the company`s
convertible bondholders had accepted an offer by Gold One to repurchase
approximately US$12 million of bonds. This process has begun, and to date, Gold
One has repurchased US$8 million of convertible bonds, with a further US$4.1
million to be bought in the current quarter reducing the outstanding bond
liability from the original US$71.6 million to around US$60 million.
The Gold One bondholders have a once-off option to put the bonds to the company,
at the accreted principal amount, on 12 December 2010. Notice of their intention
to put their bonds needs to be provided to the company 30 days in advance of the
put date. Gold One has engaged Rothschild to work with the company and potential
funders to consider debt facility options to address any potential puts. This
process is well underway.
As at 31 December 2009, Gold One had cash of approximately A$15 million
(ZAR100.2 million; US$ 13.4 million).
5 OUTLOOK
Gold One expects Modder East production to remain at December 2009 levels for
the first quarter of 2010, resulting in a target of approximately 15,000 ounces
of gold production. Cash costs are further expected to decrease to
approximately $400 per ounce. Capital expenditure in the first and second
quarter has been scheduled to ensure that Gold One remains cash flow positive.
Production ramp-up to the targeted gold production of between 100,000 ounces and
120,000 ounces for 2010 will continue from the middle of the second quarter as
additional panels come into production.
The production ramp-up will primarily depend on the generation of sufficient
face and ore volumes. Ore volumes are primarily dependent on people and more
specifically Gold One employees. The company has recently entered into wage
negotiations with organised labour, and while Gold One is confident of a
mutually beneficial outcome for all parties, this can be a disruptive process.
6 CAPITAL STRUCTURE
The company has as of 25 January 2010, 805,239,398 shares in issue of which
414,405,131 (51.47%) are held on the Australian branch register and 390,834,267
(48.53%) are held on the South African branch register. Liquidity continues to
improve in the Australian market, with an average 1,277,920 Gold One shares
traded daily on the ASX in the quarter under review. Liquidity on the JSE also
remains healthy, with over 900,000 Gold One shares traded on average daily on
the JSE.
Research coverage on Gold One is now provided by five investment analysts all of
whom have a buy rating on the stock. Management is due to present Gold One`s
investment case at the annual Mining in Africa Conference hosted in Cape Town on
2 February 2010 and also at the Perth Paydirt Gold Conference in Australia on 15
- 16 March 2010.
ASX trading statistics for the quarter ended 31 December 2009:
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
JSE trading statistics for the quarter ended 31 December 2009:
(For the release with pictures and schematics, please refer to the company`s
website hosted at www.gold1.co.za)
Note:
Exchange rate of ZAR/A$ of ZAR6.75 and ZAR/US$ of ZAR7.48 applicable throughout.
Issued by Gold One International Limited
Website : www.gold1.com.au
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
27 January 2010
Sponsor
Macquarie First South Advisers (Pty) Limited
About Gold One:
Gold One International Limited is an Australian and African gold producer listed
on the financial markets operated by ASX Limited (the Australian Securities
Exchange) and JSE Limited (the Johannesburg Securities Exchange) (issuer code
GDO). Its flagship operation is the newly built shallow depth Modder East mine
on the East Rand, some 30 kilometres from Johannesburg; Gold One also owns the
nearby existing Sub Nigel mine, which is used primarily as a training centre in
the build-up of the Modder mine to full production. 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. Gold One has an issued share capital of 805,239,398 shares.
Office details
Sydney Head Office
Level 3, 100 Mount Street North Sydney NSW 2060
PO Box 1244 North Sydney NSW 2059
Telephone: +61 2 9963 6400
Fax: +61 2 9963 6499
Johannesburg Corporate Office
45 Empire Road, First Floor
Parktown, 2193
Gauteng, South Africa
Telephone: +27 11 726 1047
Fax: +27 11 726 1087
Issued capital
805,239,398 shares in issues
Options (listed and unlisted: 60,631,254)
ADR ratio 1:10
Stock Exchange Listings
ASX /JSE: GDO
OTCQX International: GLDZY
Directors
NJ Froneman (President and CEO)
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)
PJ Kruger (Company Secretary)
Registrars
Registries Limited
Level 7
207 Kent Street
Sydney
NSW
Australia
2000
Tel: +61 2 9290 9600
South African Transfer Secretaries
Computershare Investor Services
70 Marshall Street
Johannesburg, 2001
South Africa
Tel: +27 86 110 0933
Level 1 ADR sponsor
The Bank of New York Mellon
Depositary Receipts Division
101 Barclay St, 22nd Floor
New York, New York 10286 USA
Tel: +1 212 815 3700
Fax: +1 212 571 3050
Web site: www.adrbny.com
Auditors
PricewaterhouseCoopers
201 Sussex Street
Sydney, New South Wales 1171
Australia
Telephone: +61 2 8266 0000
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 presentation that relates to exploration results,
mineral resources or ore reserves is based on information compiled by Dr.
Richard Stewart, PhD, Pr.Sci.Nat., Vice President, Geology, Gold One, who is a
Member of the Geological Society of South Africa. Dr Stewart is a full-time
employee of Gold One. He has 10 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`. Dr Stewart consents to the
inclusion in this presentation of the matters based on information compiled by
Gold One employees 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 STATEMENTS:
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: 27/01/2010 08:41:01 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.
