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Modifying factors

Mineral Resource tonnages and grades for underground operations are estimated in situ over a minimum mining width, and include mineralisation below the selected cut-off grade to ensure that the Mineral Resource comprises practical mining blocks of adequate size and continuity.

Open pit operations are typically confined to pit shells that are defined by the price and costs used for their estimates. This approach for Mineral Resources utilises unengineered pit shells to constrain the mineralisation to that which is economically and practically extractable under assumed economic conditions, and reflects technical rigour compared to the disclosure of a mineral inventory, regardless of stripping ratios, location and continuity.

Mineral Reserves are that portion of the Mineral Resource which technical and economic studies have demonstrated can justify extraction at the time of disclosure. Estimates of tonnages and grades quoted as Mineral Reserves include allowances for all mining dilution, all other mining and modifying factors and consequently, are reported as net tonnes and grades delivered to the mill.

Mineral Reserves for the South Africa Region operations are estimated using a total cost pay limit, with the exception of South Deep which uses a cut-off grade, historical mining efficiencies, cost levels at each operation and the current Life-of-Mine (LoM) plan. The conversion ratio from Mineral Resource to Mineral Reserve in the South Africa Region is affected by the following key factors:

  • The exclusion from Mineral Reserves of regional support pillars and safety pillars as designed into the current mine plan.
  • Mining constraints applied to the extraction, based on the geometry of the geological structures as presently interpreted.
  • The gold price differential applied to the Mineral Reserve and Mineral Resource, with the latter being higher to reflect the potential inherent to the ore bodies at possible future elevated gold prices.

Mineral Reserves for West Africa are estimated using mine designs generated after standard mine optimisation methods, current cost structures and technical assumptions derived from actual production history and/or feasibility studies.

Mineral Reserve parameters for the Australasia Region vary on a project-by-project basis, and reflect specific cost structures and technical assumptions derived from actual production history or extensive feasibility work.

Cerro Corona’s Mineral Reserves are limited by the finite capacity of the Tailing Storage Facility (TSF). The Net Smelter Return cutoff calculation takes account of all cost and technical parameters.

Operations are entitled to mine all declared material located within their respective mineral rights and/or mining rights and all necessary statutory mining authorisations and permits are in place or have reasonable expectation of being granted. One exception is Damang, where the Abosso underground rights from below 30 meters, are currently held by Tarkwa Gold Mine.

The following modifying factors were applied in the reserving process:

                                      Cerro Corona
                  South                        
    Unit Driefontein   Kloof   Beatrix   Deep   Tarkwa   Damang   St Ives   Agnew   Gold   Copper
  Plant Recovery
Factor
Mill % 97   98   96   97   97   92.5 – 93.5   89   94.7   53 – 74   65 – 90
HL %         64     55 – 75      
  Strip Ratio waste: ore         5.18   2.24   4.15     1.18
  Mine Dilution                       Hy 15%   OP 6 – 35            
% 23   27   23   6   11   &   &   12 to 38    
                      Pa 40cm   UG 2 – 47            
  Mineral Reserve
Pay Limit/
Cut-off grade
cm.g/t 1,170   1,310   840                  
                      FO 0.70   OP 0.7   Stockpile 0.35   Net smelter return
US$13.95/t
Mill g/t       4.0   0.44   &   &   &  
                      OxO 0.38   UG 1.7 – 3.3   UG 3.1 to 4.4  
HL g/t         0.31     0.7          
  Mine Call Factor % 91   85   86   100   100   100   100   100    
  Stope Width cm 151   146   154              

Mineral Reserve commodity prices used in declaration (financial 2010 in brackets): R/kg – R240,000 (R230,000); A$/oz – A$1,100 (A$1,000); US$/oz – US$925 (US$800); and US$/lb – US$2.40 (US$2.20). Exchange rates: R:US$ – R8.07 & A$:US$ – A$1.19
HL: Heap leach, Hy: Hydrothermal, Pa: Palaeoplacer, FO: Fresh Ore, OxO: Oxide Ore, OP: Open Pit, UG: Underground

Rounding-off figures may result in minor computational discrepancies, where this happens it is not deemed significant. All references to tonnes are metric units.