| Mon 5 Dec 2005, 14:19 | | Gold Fields To Proceed With Cerro Corona Project |
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Gold Fields Limited - Gold Fields To Proceed With Cerro Corona Project In Peru
Gold Fields limited
Code: GFI
ISIN: ZAE000018123
MEDIA RELEASE
Gold Fields To Proceed With Cerro Corona Project In Peru
Johannesburg, December 5, 2005: Gold Fields Limited (Gold Fields) (NYSE and
JSE: GFI) is pleased to announce that the Peruvian Government has approved the
environmental impact study for the Cerro Corona project in Northern Peru.
The feasibility study for this project was completed during November and the
Gold Fields Board, subject to the receipt of this approval, subsequently
approved the associated investment.
The project involves the development of a 91 million ton gold/copper porphyry
deposit at a capital cost of US$277 million. The project has reserves1 of some
2.9 million ounces of gold and 480,000 tons of copper, or approximately 5.4
million ounces of gold equivalent1.
The project is expected to produce approximately 2.3 million ounces of gold and
412,000 tons of copper over its 15-year life, averaging some 300,000 ounces per
year of gold equivalent1. However, production in the initial years of the
project will be closer to 400,000 ounces per year.
Life of mine total cash costs, on a gold equivalent basis, are estimated at some
US$250 per ounce.
Ian Cockerill, Chief Executive Officer of Gold Fields said: "The approval of the
environmental impact study is the first step in what we believe will be a long
and mutually beneficial partnership between Gold Fields and the people of Peru".
Gold Fields announced on December 19, 2003, that it, through its subsidiary Gold
Fields Corona BVI., had signed a definitive share purchase agreement to acquire
92.0 per cent of the voting shares (80.7% of the economic interest) in Sociedad
Minera La Cima S.A., which owns the Cerro Corona Project and other mineral
properties in the Cajamarca district of Peru.
Gold Fields will now commence steps to complete the acquisition referred to
above for a total consideration of US$40 million, and construction is expected
to commence in February 2006.
"Cerro Corona will bring us closer to our strategic goal of acquiring an
additional 1.5 million ounces of international production by 2009, thereby
improving the balance between production from our South African and
International operations. It will consolidate our position in South America and,
together with our proposed acquisition of Bolivar and its Choco 10 mine in
Venezuela, increase substantially our presence in one of the most prospective
gold regions of the world," added Cockerill.
Cerro Corona will be a single surface mine producing approximately 6.2 million
tons per annum of ore at a life of mine strip ratio of 0.83, for a total of
approximately 91 million tonnes of ore mined over a 15-year life, at an average
grade of 1.0 gram per tonne of gold and 0.53% copper.
Ore will be treated in a conventional sulphide flotation concentrator, to
produce a 25% copper concentrate containing typically 40 grams per tonne of gold
for custom smelting at third party facilities.
Approximately US$150 million of the capital costs will be financed through a
project finance facility and the balance of the capital costs as well as the
purchase consideration is expected to be funded from internal sources.
"With a purchase price of less than US$11 per reserve ounce of gold-equivalent,
the total cost of gold bought (acquisition cost + capital costs + working
costs), per ounce of gold recovered, is approximately US$340 per ounce. Cerro
Corona represents fundamental value for Gold Fields" shareholders and again
confirms our commitment to the principle of not overpaying for assets," said
Cockerill
"In Cerro Corona we will have a Gold Fields franchise asset at one of the best
gold mining addresses in South America, a significant foothold from which we
intend to grow in the region," he added.
The Cerro Corona deposit is located within a well-endowed mineralised trend in
the Hualgayoc mining district, about 35 kilometres north of the well known
Yanacocha mine and approximately 90 kilometres by road north of the Departmental
capital of Cajamarca in the western Cordillera of the Andes Mountains.
Gold Fields is one of the world"s largest unhedged gold producers, with annual
gold production of approximately 4.2 million ounces from mines in South Africa,
Ghana and Australia as well as a development project at Cerro Corona in Peru.
The Company has reserves of 64.8 million ounces and mineral resources of 174.5
million ounces. Gold Fields has its primary listing on the Johannesburg
Securities Exchange and secondary listings on the NYSE, LSE, Euronext in Paris
and Brussels, and on the Swiss Exchange. All of Gold Fields" operations are ISO
14001 certified.
-ends-
Enquiries:
Gold Fields
Willie Jacobsz
+27 11 644-2505
williej@goldfields.co.za
Nerina Bodasing
+27 11 644-2630
nerinab@goldfields.co.za
Cheryl Martin
(303) 796-8683
camartin@gfexpl.com
Date: 05/12/2005 02:19:52 PM Produced by the JSE SENS Department
