West Africa region

Ghana

Tarkwa

Gold production decreased from 185,500 ounces in the September quarter to 176,600 ounces in the December quarter.  The lower production was as a result of decreased heap leach throughput and decreased CIL head grade.   

Total tonnes mined, including capital stripping, decreased from 34.2 million tonnes in the September quarter to 32.9 million tonnes in the December quarter due to wet weather hampering mining activities.  Ore mined increased from 5.2 million tonnes to 5.6 million tonnes, due to a lower strip ratio. Mined grade was similar to the previous quarter at 1.23 grams per tonne. The strip ratio reduced from 5.54 in the September quarter to 4.86 in the December quarter.

The total feed to the CIL plant increased from 2.79 million tonnes in the September quarter to 2.85 million tonnes in the December quarter despite power outages. Yield from the CIL plant decreased from 1.5 grams per tonne for the September quarter to 1.4 grams per tonne for the December quarter as a result of dewatering activities in the high grade Teberebie Pit as well as ore competency issues, requiring ore blending to enhance throughput at a slightly lower yield. The CIL plant produced 126,800 ounces in the December quarter compared with 133,800 ounces in the September quarter. 

Total feed to the North heap leach decreased marginally from 2.08 million tonnes in the September quarter to 2.06 million tonnes in the December quarter.  The yield at the North heap leach at 0.65 grams per tonne was flat quarter on quarter.  The “High Pressure Grinding Roller” (HPGR) unit at the South heap leach processed 0.84 million tonnes, compared with 0.88 million tonnes achieved in the September quarter. The average yield of 0.38 grams per tonne from HPGR production represented a decrease of 0.01 grams per tonne against the September quarter. The heap leach process produced 49,800 ounces, compared with 51,700 ounces in the September quarter. The shortfall was attributable to increased ore hardness, resulting in lower volumes of processed feed and lower recoveries.  Blending of soft ore with hard ore has been implemented at the North heap leach as a short-term mitigating strategy, ahead of the planned upgrade to the tertiary crushing circuit.

Operating costs, including gold-in-process movements, decreased from US$108 million (R791 million) in the September quarter to US$101 million (R695 million) for the December quarter.  The decrease was mainly attributable to an increase of gold-in-process valued at US$2 million in the December quarter compared with a reduction in stockpiles in the September quarter of US$4 million, complemented by a quarter on quarter reduction in operating costs of US$1 million. The lower operating costs were mainly as a result of the decrease in maintenance costs due to the partial implementation of owner maintenance, partly offset by the increase in power costs due to increased tariffs.  Total cash cost decreased from US$601 per ounce in the September quarter to US$517 per ounce for the December quarter, mainly as a result of a once-off royalty credit adjustment as well as the reduction in operating costs.

Operating profit increased from US$119 million (R879 million) in the September quarter to US$141 million (R977 million) in the December quarter.

Capital expenditure decreased from US$61 million (R448 million) in the September quarter to US$56 million (R384 million) in the December quarter, with new mining equipment, the tailings dam expansion and pre-stripping at the Teberebie, Pepe, Akontansi and Kotraverchy cutbacks being the major items.

Notional cash expenditure increased from US$885 per ounce for the September quarter to US$893 per ounce for the December quarter due to lower production. The NCE margin increased from 28 per cent to 35 per cent.

The estimate for calendar 2011 is as follows:

Damang

Gold production increased from 56,500 ounces in the September quarter to 60,400 ounces in the December quarter, assisted by the flexibility provided through the installation of the secondary crusher. 

Total tonnes mined, including capital stripping, decreased from 3.8 million tonnes in the September quarter to 3.3 million tonnes in the December quarter.  Ore mined was similar at 1.1 million tonnes.   Operational waste was down from 2.7 million tonnes to 2.2 million tonnes in line with the mining schedule.  This resulted in a strip ratio of 2.0 compared with the September quarter’s strip ratio of 2.6.  Owner mining commenced during November 2010 and the project is currently one month ahead of schedule with planned completion by the end of March 2011.

Tonnes processed increased from 1.2 million tonnes in the September quarter to 1.3 million tonnes in the December quarter and the yield improved from 1.4 grams per tonne to 1.5 grams per tonne.  This was mainly due to milling higher volumes of fresh high grade ore.

Operating costs, including gold-in-process movements, increased from US$35 million (R260 million) in the September quarter to US$38 million (R264 million) in the December quarter mainly due to increased power costs, processing costs and a change in gold-in-process. Total cash cost decreased from US$666 per ounce to US$608 per ounce mainly as a result of the increased production and a once-off royalty credit adjustment.

Operating profit increased from US$34 million (R252 million) in the September quarter to US$45 million (R310 million) in the December quarter.   

Capital expenditure increased from US$13 million (R97 million) in the September quarter to US$43 million (R305 million) in the December quarter mainly as a result of the investment in owner mining.  The owner mining project is expected to cost around US$55 million with expenditure to date on owner mining amounting to US$42 million.

Notional cash expenditure increased from US$879 per ounce in the September quarter to US$1,349 per ounce in the December quarter also as a result of the investment in owner mining equipment.  The NCE margin decreased from 28 per cent to 2 per cent.

The estimate for calendar 2011 is as follows: