Ghana

Tarkwa

Gold production decreased by 9 per cent from 160,000 ounces in the December quarter to 145,200 ounces in the March quarter due to the planned cessation of stacking at the North heap leach operations and decreased CIL head grade and yield, partially offset by increased throughput.

Total tonnes mined, including capital stripping, decreased from 33.8 million tonnes in the December quarter to 24.5 million tonnes in the March quarter mainly due to the rescheduling of operations required by the discontinuation of the North heap leach operation. Ore tonnes mined decreased from 4.5 million tonnes to 3.5 million tonnes. Operational waste tonnes mined decreased from 17.5 million tonnes to 8.8 million tonnes and capital waste tonnes mined increased from 11.8 million tonnes to 12.2 million tonnes. The decrease in operational waste tonnes mined is in line with the 2014 mine plan. Head grade mined decreased from 1.30 grams per tonne in the December quarter to 1.28 grams per tonne in the March quarter. The strip ratio decreased from 6.5 to 6.0. The reduced mining rates, as a consequence of the cessation of the Heap leach operations, indicate that the average and peak stripping ratios over the remaining life of 12 years are expected to be 5.1 and 6.8, respectively, based on depletion of the current reserve of 7 million ounces.

The CIL plant throughput increased from 3.06 million tonnes in the December quarter to 3.38 million tonnes in the March quarter. Realised yield from the CIL plant decreased from 1.35 grams per tonne to 1.19 grams per tonne. During the March quarter, as a result of the closure of the North heap leach operation, both medium and high grade ore were fed to the CIL. In the December quarter, with the North heap leach still in operation, medium grade ore was fed into the heap leach operation and only high grade material was fed to the CIL plant. The CIL plant production decreased from 133,100 ounces in the December quarter to 129,800 ounces in the March quarter.

Feed to the North heap leach section decreased from 1.76 million tonnes in the December quarter to 192,000 tonnes in the March quarter. Gold production from the North heap leach operation decreased from 26,900 ounces in the December quarter to 15,400 ounces in the March quarter. The heap leach produced 15,400 ounces, of which 12,900 ounces was rinsed from inventory and 2,500 ounces was produced from the 192,000 tonnes stacked during the quarter.

Net operating costs, including gold-in-process movements, decreased from US$118 million in the December quarter to US$96 million in the March quarter mainly due to lower production and cost reductions as a result of the North heap leach closure.

Operating profit increased from US$85 million in the December quarter to US$92 million in the March quarter as a result of lower net operating costs and higher gold price received, partially offset by the lower gold production.

Capital expenditure increased from US$38 million in the December quarter to US$39 million in the March quarter with the majority of expenditure on pre-stripping, the tailings storage facilities and major fleet components.

All-in sustaining costs and total all-in cost per ounce decreased from US$1,096 per ounce in the December quarter to US$1,016 per ounce in the March quarter due to the decrease in operating costs, partially offset by lower gold production.

Damang

Gold production increased by 3 per cent from 45,400 ounces in the December quarter to 46,700 ounces in the March quarter due to higher mill throughput as a result of improved plant availability.

Total tonnes mined, including capital stripping, decreased from 7.3 million tonnes in the December quarter to 5.2 million tonnes in the March quarter.

Ore tonnes mined decreased from 1.3 million tonnes to 1.0 million tonnes and operational waste tonnes decreased from 6.1 million tonnes in the December quarter to 4.2 million tonnes in the March quarter. The lower tonnages mined in the March quarter were due to a strategic decision to reposition the mine in 2014. In light of the lower gold price, mining operations were focused in lower strip ratio areas and mined grades were optimised by continually improving grade control and mining quality. Despite these interventions, the mine grade is however still below the reserve grade. The strip ratio decreased from 4.8 to 4.4.

The yield decreased from 1.41 grams per tonne to 1.35 grams per tonne due to mining lower grades from Saddle pit.

Tonnes processed increased from 1.0 million tonnes in the December quarter to 1.1 million tonnes in the March quarter. The increased throughput was due to the continuous stabilisation of the milling circuit availability and utilisation.

Net operating costs, including gold-in-process movements, decreased from US$49 million to US$41 million due to good cost control and lower tonnages mined in the March quarter.

Operating profit increased from US$8 million in the December quarter to US$19 million in the March quarter as a result of the higher revenue due to higher gold production and lower net operating costs.

Capital expenditure increased from US$6 million to US$7 million due to timing of expenditure with the majority spent on Far East tailings storage facility raise.

The all-in sustaining costs and total all-in cost per ounce decreased from US$1,261 per ounce in the December quarter to US$1,111 per ounce in the March quarter due to the higher gold production and lower operating costs, partially offset by the higher capital expenditure.