Gold Fields

LIFE EXTENSION THROUGH NEAR-MINE EXPLORATION

Near-mine exploration plays a key role in Gold Fields' strategy as we believe it offers one of the lowest-cost opportunities for growing cash-flow, particularly on a per share basis. The value in near-mine exploration lies in:

• Knowledge of the ore bodies which enables the exploration teams to identify extensions or additional ore sources housed within the mining tenement
• Operational capabilities, including Gold Fields' proven ability to develop and mine orogenic ore bodies
• Regional and operational infrastructure including existing processing plants and regional management teams

In addition to adding to Gold Fields' Mineral Resource and Mineral Reserve base, near-mine exploration:

• Extends the life of the Group's existing mines
• Ensures each region can continue to leverage its infrastructure
• Provides a robust platform for regional growth

The benefits of effective near-mine exploration are evident in the history of the Agnew and St Ives mines in Western Australia. At the time of their acquisition in 2002, the mines had a combined Mineral Reserve of 2.9Moz. Since then, the two assets have produced over 10Moz and their combined Mineral Reserves still exceed over 2Moz following annual depletions. Gold Fields believes that most of its mines in Australia (which share similar orogenic ore bodies) will be able to repeat this success over the next few years.

In 2017, Gold Fields spent US$87m on near-mine exploration (2016: US$80m), which supported a total of 754,669 metres of near-mine drilling (2016: 694,527 metres). The majority of this spending - US$75m (A$99m) - was incurred at our Australian mines. US$11m was spent in Ghana, which is significantly higher than the US$3m spent in the region in 2016, amid a renewed focus on extending the life of the Tarkwa and Damang mines.

At our Cerro Corona mine in Peru, near-mine exploration is limited by the mining lease area. However, Gold Fields continues to engage the adjacent communities about the potential of future exploration in these areas.

For 2018, we have budgeted US$87m for near-mine exploration of which US$65m (A$86m) will be at our Australian operations. Our Australian mines have successfully extended their lives through a consistent investment in brownfields exploration activities.

Following is a breakdown of brownfields exploration at our operations during 2017:

St Ives

Mineral Reserve reconciliation

At St Ives, total exploration spend in 2017 was A$39m (US$29m). A total of 225,665 metres were drilled during the year, resulting in a 17% increase in Mineral Resources to 3.8Moz by the end of 2017. Taking into account the depletion of 364koz during 2017 Mineral Reserves at St Ives declined by 10% from 1.74Moz 1.57Moz.

During 2017, exploration was focused on resource extension at Invincible, lateral resource extension at Hamlet underground and continued testing of the palaeochannel opportunities. Mining at Invincible underground commenced towards the end of 2017. The Invincible complex continues to grow and is expected to remain a key contributor to production at St Ives for many years to come.

A favourable advanced scoping study on the palaeochannel project has resulted in the project moving into pre-feasibility stage. The first part of the study will focus on evaluating a viable mining method and is expected to be completed by the end of 2018. The potential resource being assessed on this project is in the range of 2Moz - 3Moz.

Agnew

Mineral Reserve reconciliation

A$28m (US$22m) was spent on exploration at Agnew during 2017 and a total of 194,910 metres were drilled during the year. Encouragingly, Agnew increased reserves after depletion during 2017, which is the first time the mine has achieved this in seven years. Mineral Reserves increased 4% to 0.54Moz, while Mineral Resources decreased 9% to 1.95Moz.

During 2017, exploration focused on resource extension at the Waroonga North underground mine and detailed in-mine targeting at Waroonga North, Kath and New Holland ore bodies. Currently, Waroonga North has 170koz in resource and 79koz in reserve, while the adjacent Kath lode has 90koz in resource and 36koz in reserve. In 2018, the focus will be on further defining these ore bodies as we believe there is reasonable upside potential.

 

Granny Smith

Mineral Reserve reconciliation

Total exploration spend at Granny Smith was A$25m (US$19m). A total of 227,357 metres were drilled during the year. This resulted in a 0.51Moz (30%) increase in Mineral Reserves and a 0.56Moz (9%) increase in Mineral Resources at Wallaby underground, the main ore body of the mine.

Following a positive feasibility study of Zone 110/120, the Board has approved the development of this extension to the Wallaby underground mine. This contains Mineral Reserves of 1.3Moz and Mineral Resources of 2.5Moz and will extend Granny Smith's life to 2027, before consolidation of Zones 135 and 150 below the current ore body.

Exploration has generated additional advanced targets on the tenement package, which will be targeted in future as additional sources of mill feed.

As at 31 December 2017, Granny Smith's Mineral Resources and Mineral Reserves were 7.08Moz and 2.20Moz, respectively.

During 2017, Tarkwa intensified its near-mine exploration efforts, spending US$5.4m on drilling 36,324 metres. Tarkwa's Mineral Reserves decreased by 0.18Moz (3%) and Mineral Resources by 0.44Moz (5%), although the area being drilled is highly prospective.

As at 31 December 2017, Tarkwa's Mineral Resources and Mineral Reserves were 8.66Moz and 5.91Moz, respectively.

While the focus at Damang was in implementing the reinvestment plan (p81), Gold Fields also spent US$5.7m in near mine exploration during the year. A total of 35,265 metres were drilled. This resulted in a 0.05Moz (4%) increase in Mineral Reserves to 1.73Moz and a 0.14Moz (2%) increase in Mineral Resources to 6.12Moz by 31 December 2017.

Damang Mineral Reserve reconciliation	Tarkwa Mineral Reserve reconciliation

View of the Rom pad and plant at Granny Smith