Continuing operations

West Africa region

Ghana

Tarkwa

As planned, gold production decreased by 7 per cent from 566,400 ounces in 2017 to 524,900 ounces in 2018 due to lower volumes and lower grades mined.

Total tonnes mined, including capital stripping, decreased by 14 per cent from 103.8 million tonnes in 2017 to 89.6 million tonnes in 2018. Ore tonnes mined decreased by 15 per cent from 16.7 million tonnes to 14.2 million tonnes. Operational waste tonnes mined decreased by 30 per cent from 35.5 million tonnes to 25.0 million tonnes and capital waste tonnes mined decreased by 2 per cent from 51.6 million tonnes to 50.4 million tonnes. The decrease was mainly due to change in strategy to reduce mining volume from 100 million tonnes per annum to 85 million tonnes per annum and the focus on capital waste strip. Head grade mined decreased by 5 per cent from 1.32 grams per tonne to 1.26 grams per tonne. Gold mined decreased by 20 per cent from 711,000 ounces to 572,100 ounces. The overall reduction of total mined tonnes, capital stripping, ore tonnes mined and head grade mined was mainly due to a change in strategy to reduce mining volumes from 100 million tonnes per annum to 85 million tonnes per annum in line with the 2018 plan. This will sustain a long term cost effective production profile of around 500,000 ounces per year for the next decade and likely beyond with further possible extension to existing pits. The strip ratio increased from 5.2 to 5.3.

The CIL plant throughput increased by 2 per cent from 13.5 million tonnes in 2017 to 13.8 million tonnes in 2018 due to increased plant availability. Realised yield from the CIL plant decreased by 9 per cent from 1.30 grams per tonne to 1.18 grams per tonne due to lower head grade mined and processing of 2.4 million tonnes of stockpiles at 0.73 grams per tonne. This compared with 1.2 million tonnes of stockpiles processed in 2017 at a grade of 0.76 grams per tonne. Medium grade stockpiles were processed in 2018, while stockpiling lower grade material mined.

Cost of sales before amortisation and depreciation, increased by 1 per cent from US$306 million in 2017 to US$309 million in 2018 due to a gold-in-process charge to cost, partially offset by lower mining costs in line with lower operational tonnes mined. The US$10 million gold-in-process charge to costs in 2018 compared with a credit to costs of US$42 million in 2017. In 2017, higher volumes were mined and stockpiled compared to 2018.

Capital expenditure decreased by 14 per cent from US$181 million to US$156 million mainly due to lower expenditure on capital waste stripping and mining fleet. Mining fleet expenditure including componentisation was US$4 million in 2018 compared with US$33 million in 2017. This was mainly due to transitioning to contract mining and the transfer of the mining fleet to the mining contractors.

All-in sustaining costs and total all-in cost increased by 1 per cent from US$940 per ounce in 2017 to US$951 per ounce in 2018 due to higher cost of sales before amortisation and depreciation and lower gold sold, partially offset by lower capital expenditure.

Guidance
The estimate for calendar 2019 is as follows:

Damang

Gold production increased by 26 per cent from 143,600 ounces in 2017 to 180,800 ounces in 2018 mainly due to higher head grade and yield.

Total tonnes mined, including capital stripping, increased by 16 per cent from 39.7 million tonnes in 2017 (25.7 million tonnes from Amoanda and other satellite pits and 14.0 million tonnes from the Damang Pit Cut Back (DPCB) to 45.9 million tonnes in 2018 (15.2 million tonnes from Amoanda and other satellite pits and 30.7 million tonnes from the DPCB) due to improved operational performance from the contractors' mining fleet and improved mining efficiencies.

Ore tonnes mined increased by 36 per cent from 3.3 million tonnes to 4.5 million tonnes mainly from Amoanda pit area where the ore zones are exposed. Operational waste tonnes mined increased by 47 per cent from 5.3 million tonnes to 7.8 million tonnes mainly as a result of mining capital waste tonnes in 2017, to align with the new mining strategy. Capital waste tonnes mined increased by 8 per cent from 31.1 million tonnes in 2017 to 33.6 million tonnes in 2018 mainly due to higher volumes mined from the DPCB pits which are in the early stages of the current cutback. Head grade mined increased by 46 per cent from 1.15 grams per tonne in 2017 to 1.68 grams per tonne in 2018 due to high grade ore mined from the Amoanda pits. Gold mined increased by 97 per cent from 122,700 ounces to 242,300 ounces. The strip ratio decreased from 10.9 to 9.2 due to exposed ore surfaces mined at the Amoanda pit.

Tonnes processed decreased by 8 per cent from 4.59 million tonnes in 2017 to 4.21 million tonnes in 2018 due to lower plant overall equipment availability as a result of a planned 16 day shutdown to replace the SAG mill shell. Yield increased by 38 per cent from 0.97 grams per tonne to 1.34 grams per tonne due to higher feed grade. In 2018, 3.38 million tonnes of fresh ore and oxides were milled at an average grade of 1.67 grams per tonne and 0.83 million tonnes of stockpiles were milled at an average grade of 0.74 grams per tonne. This compared with 2.83 million tonnes of fresh ore and oxides that was milled at an average grade of 1.16 grams per tonne and 1.76 million tonnes of stockpiles that was milled at an average grade of 0.68 grams per tonne in 2017. The stockpiles at 31 December 2018 consisted of the ROM stockpile of 0.8 million tonnes at a grade of 1.30 grams per tonne and a crushed ore stockpile of 0.2 million tonnes at a grade of 1.59 grams per tonne.

Cost of sales before amortisation and depreciation, increased by 2 per cent from US$122 million in 2017 to US$124 million in 2018 mainly due to higher operating tonnes mined, partially offset by a gold-in-process credit to costs of US$19 million in 2018 compared with a charge to costs of US$1 million in 2017.

Capital expenditure increased by 5 per cent from US$132 million to US$139 million.

Sustaining capital expenditure decreased by 18 per cent from US$17 million in 2017 to US$14 million in 2018, mainly due to the pre-development work on the Damang reinvestment project in 2017. Non-sustaining capital expenditure increased by 9 per cent from US$115 million to US$125 million mainly due to higher capital waste mined (34 million tonnes mined in 2018 compared with 31 million tonnes mined in 2017).

All-in sustaining cost decreased by 21 per cent from US$1,027 per ounce in 2017 to US$813 per ounce in 2018 due to higher gold sold and lower sustaining capital expenditure, partially offset by higher cost of sales before amortisation and depreciation.

Total all-in cost decreased by 18 per cent from US$1,827 per ounce in 2017 to US$1,506 per ounce in 2018 due to the same reasons as for all-in sustaining cost, partially offset by increased non-sustaining capital expenditure.

Guidance
The estimate for calendar 2019 is as follows:

Asanko (Equity accounted Joint Venture)

All figures in table 100 per cent basis

Gold production for the five months ended December 2018 was 98,900 ounces.

Total tonnes mined for the five months ended December 2018 were 16.9 million tonnes. Ore tonnes mined were 2.5 million tonnes. Head grade mined was 1.48 grams per tonne.

Total waste tonnes mined was 14.3 million tonnes. The strip ratio was 5.7 for the five months ended December 2018.

The plant throughput was 2.1 million tonnes for the five months ended December 2018 and yield was 1.50 grams per tonne.

Cost of sales before amortisation and depreciation for the five months ended December 2018 was US$83 million.

Sustaining capital expenditure for the five months ended December 2018 was US$18 million. Non-sustaining capital expenditure amounted to US$11 million and included construction of the haul road and other expenditure related to the Esaase project, which commenced production in early 2019.

All-in sustaining costs and total all-in cost for the five months ended December 2018 was US$1,069 per ounce and US$1,175 per ounce, respectively.

Gold Fields' 45 per cent share of gold produced and gold sold for the 5 months ending December 2018 amounted to 44,500 ounces and 45,900 ounces, respectively. Gold Fields share of cost of sales before amortisation and depreciation amounted to US$37 million and that of sustaining capital expenditure and non-sustaining capital expenditure amounted to US$8 million and US$5 million, respectively. The above translates to a US$1 million loss related to the Group's share of equity accounted losses.

Guidance
The estimate for calendar 2019 is as follows:

The large Western pushback at the Nkran pit will result in the strip ratio and mining costs remaining elevated during 2019. However, the strip levels at Nkran normalise in 2020, at which point the higher-grade production from the shallow Esaase oxides will be ramping up, having a material positive impact on unit costs. In addition, Gold Fields is working with our JV partners on a cost optimisation exercise which is expected to result in further cost reductions. We will provide updated near-term guidance on costs when we release the updated life of mine plan in H2 2019. Which update will take account of the longer term potential of the Esaase project which is expected to become the centre of gravity for the operation.