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Reviewed Results | Year ended 31 December 2021

Commentary Review of operations

Year ended December 2021 compared with year ended December 2020

Figures may not add as they are rounded independently.

South Africa region

South Deep

      Dec
2021
  Dec
2020
%
Variance
 
Ore mined 000
tonnes
    1,540     1,136 36 %  
Waste mined 000
tonnes
    201   86 134 %  
Total tonnes 000
tonnes
    1,741     1,222 42 %  
Grade mined – underground reef g/t   6.33   6.31 – %  
Grade mined – underground total g/t   5.60   5.86 (4) %  
Gold mined kg     9,744     7,161 36 %  
  000’oz     313.3     230.2 36 %  
Destress m2   44,398   35,545 25 %  
Development m     5,505     3,548 55 %  
Secondary support m   14,538     9,504 53 %  
Backfill m3     298,186     322,823 (8) %  
Ore milled – underground reef 000
tonnes
     1,535.6      1,154.3 33 %  
Ore milled – underground waste 000
tonnes
    154.0   55.3 178 %  
Ore milled – surface 000
tonnes
     1,232.5      1,048.1 18 %  
Total tonnes milled 000
tonnes
     2,922.1      2,257.7 29 %  
Yield – underground reef g/t   5.84   6.01 (3) %  
Surface yield g/t   0.11   0.11 – %  
Total yield g/t   3.11   3.13 (1) %  
Gold produced kg     9,102     7,056 29 %  
  000’oz     292.6     226.9 29 %  
Gold sold kg     9,102     7,056 29 %  
  000’oz     292.6     226.9 29 %  
AISC R/kg     622,726     651,514 (4) %  
  US$/oz     1,310     1,237 6 %  
AIC R/kg     655,826     663,635 (1) %  
  US$/oz     1,379     1,260 9 %  
Sustaining capital expenditure Rm      1,019.1     718.4 42 %  
  US$m   68.9   43.9 57 %  
Non-sustaining capital expenditure Rm     301.3   85.5 252 %  
  US$m   20.4      5.2 292 %  
Total capital expenditure Rm      1,320.4     803.9 64 %  
  US$m   89.3   49.1 82 %  
Adjusted free cash flow Rm      1,435.1     557.8 157 %  
  US$m   97.0   34.1 184 %  

South Deep showed significant improvement in most key performance measures during FY2021 compared to FY2020 despite both years being impacted by COVID-19-related interruptions. These improvements are in line with the mine production ramp up plan to 12t gold output annually. Productivity improvement programmes that were introduced in 2019 are sustainably delivering results. The COVID-19- related production impact, primarily in Q1 of 2021, was 300kg (9,600oz) and compared to 1,000kg (32,000oz) in 2020.

Gold production increased by 29% to 9,102kg (292,600oz) in 2021 from 7,056kg (226,900oz) in 2020. The increased gold production was due to improved volumes mined and processed as well as lower COVID-19-related production losses in 2021.

Ore mined increased by 36% to 1,540kt in 2021 from 1,136kt in 2020. North of Wrench increased its contribution YoY from 65% to 71%, while current mine reduced its contribution from 35% to 29% as part of the focus to transition away from current mine to higher productivity North of Wrench. Underground reef grade mined remained similar at 6.33g/t.

Waste mined increased by 134% to 201kt in 2021 from 86kt in 2020 as growth capital development was ramped up to ensure key infrastructure is installed on schedule in order to achieve planned production ramp up.

Destress increased by 25% to 44,398m2 in 2021 from 35,545m2 in 2020, while reef horizon development metres increased by 55% to 5,505m in 2021 from 3,548m in 2020 as a result of improved operational efficiencies, mainly drill rigs.

Secondary support increased by 53% in line with increased destress and development whereas backfill decreased by 8% in 2021 as backlog reduced compared to 2020 and some stopes not scheduled for backfilling in 2021.

Surface re-mining and processing tonnes increased by 18% due to increased operational efficiencies.

Total yield decreased by 1% to 3.11g/t in 2021 from 3.13g/t in 2020 largely driven by the increase in surface re-mining volumes.

Total all-in cost decreased by 1% to R655,826/kg (US$1,379/oz) in 2021 from R663,635/kg (US$1,260/oz) in 2020 with the inflationary effect and higher capital cost fully offset with improved gold production and sales. All-in cost in US Dollar terms increased by 9% as a result of the strengthening of the South African Rand by 10% from R16.38 in 2020 to R14.79 in 2021.

Capital expenditure increased by 64% to R1.3bn (US$89m) in 2021 from R804m (US$49m) in 2020 as detailed below.

Sustaining capital expenditure increased by 42% to R1.0bn (US$69m) in 2021 from R718m (US$44m) in 2020 mainly due to the construction of the solar plant of R129 (US$9m), Doornpoort tailings storage facility extension, on site power generation plant (diesel generators) and the purchase of a mobile raise boring machine.

Non-sustaining capital expenditure increased by 252% to R301m (US$20m) in 2021 from R86m (US$5m) in 2020. This increase was due to the recommencement of capital development in the new mine area and associated infrastructure projects.

Adjusted free cash flow increased by 157% to R1.4bn (US$97m) in 2021 compared to R558m (US$34m) in 2020. The increase is mainly due to higher gold sold, partially offset by higher cost of sales before amortisation and depreciation, as well as higher capital expenditure. The adjusted free cash flow in 2020 was also impacted by a realised hedge loss of R1,563m (US$95m).

Guidance

Guidance for 2022 is as follows:

  • Gold produced ~ 9,600kg (308,600oz) to 9,700kg (311,800oz);
  • Sustaining capital expenditure ~ R1,547m (US$99m);
  • Non-sustaining capital expenditure ~ R383m (US$25m);
  • All-in sustaining costs ~ R715,000/kg (US$1,430/oz); and
  • Total all-in cost ~ R755,000/kg (US$1,510/oz).

Capital expenditure is expected to increase by approximately R600m (US$39m) mainly due to growth capital on new mine development, mobile fleet requiring replacement and rebuilds due, as well as the majority of the solar plant build of R554m (US$36m). In addition, investment in new mine underground infrastructure to support the increase in production is required.

The increase in AIC is due to higher capital expenditure and higher cost of sales before amortisation and depreciation as a result of inflationary increases, partially offset by higher gold sold.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts either production or costs is indeterminable at this stage.

West Africa region

Ghana

    Dec
2021
  Dec
2020
%
Variance
 
Gold produced 000’oz 870.7   861.7 1 %  
AISC US$/oz 1,083   1,027 5 %  
AIC US$/oz 1,112   1,060 5 %  
Adjusted free cash flow US$m 292.3   252.0 16 %  

Total production increased by 1% to 871koz in 2021 from 862koz in 2020 mainly due to increased production at Damang as mining progressed into the main ore body at the Damang Pit Cutback (DPCB), partially offset by reduced production at Asanko.

All-in cost increased by 5% to US$1,112/oz in 2021 from US$1,060/oz in 2020 mainly due to cost inflation and higher all-in cost at Asanko.

The region produced adjusted free cash flow (excluding Asanko) of US$292m in 2021 compared to US$252m in 2020. Gold Fields received US$5m on the redemption of preference shares from Asanko in 2021. If included the adjusted free cash flow in 2021 would be US$297m. Gold Fields received US$38m on the redemption of preference shares from Asanko in 2020. If included the adjusted free cash flow in 2020 would be US$290m. The adjusted free cash flow in 2020 was also impacted by a realised hedge loss of US$115m.

Tarkwa

Dec
2021
Dec
2020
%
Variance
Ore mined 000
tonnes
11,756 11,877 (1) %
Waste (Capital) 000
tonnes
53,077 48,271 10 %
Waste (Operational) 000
tonnes
26,848 28,756 (7) %
Total waste mined 000
tonnes
79,925 77,027 4 %
Total tonnes mined 000
tonnes
91,681 88,904 3 %
Grade mined g/t 1.38 1.40 (1) %
Gold mined 000’oz 520.5 533.3 (2) %
Strip ratio waste/
ore
6.8 6.5 5 %
Tonnes milled 000
tonnes
13,877 14,234 (3) %
Yield g/t 1.17 1.15 2 %
Gold produced 000’oz 521.7 526.3 (1) %
Gold sold 000’oz 521.7 526.3 (1) %
AISC US$/oz 1,155 1,017 14 %
AIC US$/oz 1,155 1,017 14 %
Sustaining capital expenditure US$m 209.0 147.2 42 %
Non-sustaining expenditure US$m – %
Total capital expenditure US$m 209.0 147.2 42 %
Adjusted free cash flow US$m 194.3 186.1 4 %

Gold production decreased by 1% to 521,700oz in 2021 from 526,300oz in 2020 mainly due to lower tonnes processed. Realised yield increased by 2% to 1.17g/t in 2021 from 1.15g/t in 2020 due to higher grades processed. Ore rehandled from stockpiles was 3,336kt at a head grade of 0.78g/t in 2021 compared to 3,993kt at a head grade of 0.76g/t in 2020.

Total tonnes mined, including capital waste stripping, increased by 3% to 91.7Mt in 2021 from 88.9Mt in 2020 due to improved equipment performance. Ore mined decreased by 1% to 11.8Mt in 2021 from 11.9Mt in 2020. Capital waste stripped increased by 10% to 53.1Mt in 2021 from 48.3Mt in 2020 due to improved equipment performance and the strategy to advance capital waste stripping in 2021 to expose ore for 2022. Operational waste decreased by 7% to 26.8Mt in 2021 from 28.8Mt in 2020 in line with the mining schedule.

All-in cost increased by 14% to US$1,155/oz in 2021 from US$1,017/ oz in 2020 due to higher capital expenditure, lower gold sold and higher cost of sales before amortisation and depreciation. Both capital and operating expenditure include a contractor mining rate adjustment in 2021.

Total capital expenditure increased by 42% to US$209m in 2021 from US$147m in 2020 as a result of increased expenditure on capital waste stripping and tailings storage facility construction. The additional expenditure on tailings storage in 2021 was to address the recommendations and instructions from the Inspectorate Division of the Minerals Commission and the remedial measures proposed by Knight Piesold and SLR Consulting (EoR – Engineer on Record).

Tarkwa generated adjusted free cash flow of US$194m in 2021 compared to US$186m in 2020 mainly due to a higher gold price received and a realised hedge loss of US$79m included in the 2020 adjusted free cash flow.

Guidance

The estimate for 2022 is as follows:

  • Gold produced ~ 515,000oz;
  • Sustaining capital expenditure ~ US$198m;
  • All-in sustaining costs ~ US$1,230/oz; and
  • Total all-in cost ~ US$1,230/oz.

The increase in AIC is due to higher cost of sales before amortisation and depreciation as a result of inflationary increases.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Damang

      Dec
2021
  Dec
2020
%
Variance
 
Ore mined 000
tonnes
    8,271     6,680 24 %  
Waste (Capital) 000
tonnes
    983      8 12188 %  
Waste (Operational) 000
tonnes
  14,769   22,541 (34) %  
Total waste mined 000
tonnes
  15,752   22,549 (30) %  
Total tonnes mined 000
tonnes
  24,022   29,229 (18) %  
Grade mined g/t   1.53   1.62 (6) %  
Gold mined 000’oz     405.6     347.4 17 %  
Strip ratio waste/
ore
     1.9      3.4 (44) %  
Tonnes milled 000
tonnes
    4,720     4,798 (2) %  
Yield g/t   1.68   1.45 16 %  
Gold produced 000’oz     254.4     223.0 14 %  
Gold sold 000’oz     254.4     223.0 14 %  
AISC US$/oz     802     1,008 (20) %  
AIC US$/oz     852     1,035 (18) %  
Sustaining capital expenditure US$m   17.4   13.8 26 %  
Non-sustaining expenditure US$m      6.0      6.1 (2) %  
Total capital expenditure US$m   23.4   19.9 18 %  
Adjusted free cash flow US$m   98.0   65.9 49 %  

Gold production increased by 14% to 254,400oz in 2021 from 223,000oz in 2020 due to higher yield as a result of higher grade of ore processed. Yield increased by 16% to 1.68g/t in 2021 from 1.45g/t in 2020. This improvement was as a result of selectively feeding the higher grade portion of the higher ore tonnes mined to the mill. The 2020 year for Damang consisted of two halves with H1 still focused on higher waste stripping and mining the lower grade Huni Sandstone section while in H2 the mine transitioned into the main ore body of the Damang pit complex.

Total tonnes mined decreased by 18% to 24.0Mt in 2021 from 29.2Mt in 2020 due to lower strip ratio and physical space constraint in the Damang Pit Cut Back (DPCB).

Ore tonnes mined increased by 24% to 8.3Mt in 2021 from 6.7Mt in 2020 due to accelerated mining in the main ore body to preferentially process higher grade ore and stockpile lower grade material from the Damang pit.

Capital waste tonnes mined at 1.0Mt in 2021 compared to 0.01Mt in 2020 due to the commencement of waste stripping at Huni pit. Operational waste tonnes decreased by 34% to 14.8Mt in 2021 from 22.5Mt in 2020 due to the reduced mining rate in DPCB. Strip ratio decreased by 44% to 1.9 in 2021 from 3.4 in 2020 due to mining within the exposed ore zones of the main orebody at DPCB.

Gold mined increased by 17% to 406koz in 2021 from 347koz in 2020 due to mining within the exposed ore zones of the main orebody at DPCB.

Given the plant capacity constraint, 3.8Mt of the 8.3Mt ore mined was processed in addition to 0.9Mt depleted from stockpile in 2021. The remaining 4.5Mt of the ore mined was added to the stockpile. The closing balance of the stockpile increased to 7.0Mt at an average grade of 0.95g/t in 2021 from 3.3Mt at an average grade of 1.07g/t in 2020.

All-in cost decreased by 18% to US$852/oz in 2021 from US$1,035/oz in 2020 due to higher gold sold and lower cost of sales before amortisation and depreciation, partially offset by higher capital expenditure.

Total capital expenditure increased by 18% to US$23m in 2021 from US$20m in 2020. Sustaining capital expenditure increased by 26% to US$17m in 2021 from US$14m in 2020 mainly due to the higher capital waste tonnes mined at the Huni pit. Non-sustaining capital expenditure was similar at US$6m in 2021.

Damang generated adjusted free cash flow of US$98m in 2021 compared to US$66m in 2020 due to higher revenue resulting from higher gold sold and higher gold price received and a realised hedge loss of US$36m included in the 2020 adjusted free cash flow.

As we continue to deliver into the Damang Reinvestment Plan, 2022 will be the last full production year at the mine, with production expected to be c.230koz for the year. Thereafter, we expect production to decline to c.150koz in 2023 with production for the last two years of life (2024 and 2025) derived from stockpile treatment (c.125koz per year). In the meantime, project studies are underway to determine whether life extension projects are financially viable. We will provide an update on these projects later in the year.

Guidance

The estimate for 2022 is as follows:

  • Gold produced ~ 229,000oz;
  • Sustaining capital expenditure ~ US$42m;
  • Non-sustaining capital expenditure ~ US$10m;
  • All-in sustaining costs ~ US$950/oz; and
  • Total all-in cost ~ US$1,030/oz.

The increase in AIC is due to lower gold sold, higher capital expenditure mainly due to higher capital waste tonnes mined at the Huni pit and higher cost of sales before amortisation and depreciation as a result of inflationary increases.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Asanko (Equity accounted Joint Venture)

      Dec
2021
  Dec
2020
%
Variance
 
Ore mined 000
tonnes
    6,261     6,193 1 %  
Waste (Capital) 000
tonnes
    2,038     4,974 (59) %  
Waste (Operational) 000
tonnes
  35,356   33,298 6 %  
Total waste mined 000
tonnes
  37,394   38,272 (2) %  
Total tonnes mined 000
tonnes
  43,655   44,465 (2) %  
Grade mined g/t   1.28   1.45 (12) %  
Gold mined 000’oz     257.1     287.9 (11) %  
Strip ratio waste/
ore
     6.0      6.2 (3) %  
Tonnes milled 000
tonnes
    5,933     5,943 – %  
Yield g/t   1.10   1.31 (16) %  
Gold produced 000’oz     210.2     249.9 (16) %  
Gold sold 000’oz     216.1     243.8 (11) %  
AISC US$/oz     1,431     1,114 28 %  
AIC US$/oz     1,559     1,316 18 %  
Sustaining capital expenditure US$m   28.9   28.7 1 %  
Non-sustaining expenditure US$m   16.6   40.5 (59) %  
Total capital expenditure US$m   45.5   69.2 (34) %  
Adjusted free cash flow US$m   25.0   65.5 (62) %  

All figures in table on a 100% basis.

Gold production decreased by 16% to 210,200oz (100% basis) in 2021 from 249,900oz (100% basis) in 2020, of which 94,600oz (2020: 112,500oz) was attributable to Gold Fields. The decrease was mainly due to lower yield which decreased by 16% to 1.10g/t in 2021 from 1.31g/t in 2020. The lower yield was a direct result of lower grade ore mined and processed combined with a reduction in recovery due to processing material with a high organic carbon content.

Gold mined decreased by 11% to 257,100oz (100% basis) in 2021 from 287,900oz (100% basis) in 2020 as a result of lower grade ore mined. Grades mined at both Esaase and Akwasiso remained below expectations.

Total tonnes mined decreased by 2% to 43.7Mt in 2021 from 44.5Mt in 2020 due to mining from only two main pits namely Esaase and Akwasiso cut 3 with reduced stripping ratios at the Esaase pit. In 2020 mining took place in three pits, namely Esaase, Akwasiso cut 2 and Nkran.

All-in cost increased by 18% to US$1,559/oz in 2021 from US$1,316/ oz in 2020 due to an increase in cost of sales before amortisation and depreciation and lower gold sold, partially offset by lower capital expenditure.

Total capital expenditure (100% basis) decreased by 34% to US$46m in 2021 from US$69m in 2020. Sustaining capital expenditure was similar at US$29m in 2021. Non-sustaining capital expenditure decreased by 59% to US$17m in 2021 from US$41m in 2020 due to decreased expenditure on Tetrem relocation project (RAP), exploration at Miridani North and Akwasiso cut 3.

Asanko generated adjusted free cash flow of US$25m in 2021 compared to US$66m in 2020 mainly due to lower gold sold and higher cost of sales before amortisation, partially offset by lower capital expenditure.

Guidance

At this point in time, Gold Fields is not in a position to provide 2022 production guidance for Asanko. Consequently, Group guidance excludes our share of the Asanko Joint Venture. We expect Galiano, who are the operators of the Asanko Mine, to update the market on the outlook for Asanko by the end of Q1 2022.

South America region

Peru

Cerro Corona

      Dec
2021
  Dec
2020
%
Variance
 
Ore mined 000
tonnes
    8,959     7,303 23 %  
Waste mined 000
tonnes
  19,342   10,921 77 %  
Total tonnes mined 000
tonnes
  28,301   18,224 55 %  
Grade mined – gold g/t   0.76   0.85 (11) %  
Grade mined – copper per cent   0.42   0.42 – %  
Gold mined 000’oz     220.2     200.2 10 %  
Copper mined 000
tonnes
  38,052   31,014 23 %  
Tonnes milled 000
tonnes
    6,817     6,796 – %  
Gold recoveries per cent   64.7   65.3 (1) %  
Copper recoveries per cent   87.1   87.6 (1) %  
Yield – Gold g/t   0.54   0.57 (5) %  
– Copper per cent   0.40   0.38 5 %  
– Combined eq g/t   1.13   0.95 19 %  
Gold produced 000’oz     113.3     119.4 (5) %  
Copper produced tonnes   25,948   24,857 4 %  
Total equivalent gold produced 000’
eq oz
    248.3     207.1 20 %  
Total equivalent gold sold 000’
eq oz
    248.4     205.5 21 %  
AISC US$/oz      (34)     484 (107) %  
AISC US$/
eq oz
    920     984 (7) %  
AIC US$/oz     230     715 (68) %  
AIC US$/
eq oz
    1,040     1,119 (7) %  
Sustaining capital expenditure US$m   27.6   23.6 17 %  
Non-sustaining capital expenditure US$m   28.1   26.3 7 %  
Total capital expenditure US$m   55.8   49.9 12 %  
Adjusted free cash flow US$m   57.1   83.8 (32) %  

2021 continued to be a challenging year for the Cerro Corona operation, after the Peruvian Government declared a State of Emergency in response to the COVID-19 pandemic back in March 2020. Measures taken to control the virus limited the Company's operational capability, since new protocols limited the capacity at the camp, negatively affecting the mining operation and construction projects. The equivalent ounce impact of COVID-19, mostly in Q1 of 2021, was 20,000 eq oz and compared to 46,000 eq oz in 2020. In addition H1 2021 was impacted by slope instability at the pit as a result of the abnormally high rainfall season which triggered the resequencing of the mining plan, impacting on the ore mined from the eastern part of the mine.

Gold production decreased by 5% to 113,300oz in 2021 from 119,400oz in 2020 due to lower grade processed, while copper production increased by 4% to 25,948t in 2021 from 24,857t in 2020 due to higher grades processed. Equivalent gold production increased by 20% to 248,300oz in 2021 from 207,100oz in 2020 mainly due to the higher price factor (41Koz).

Total tonnes mined increased by 55% to 28.3Mt in 2021 from 18.2Mt in 2020 mainly due to an increase in waste mined of 77% to 19.3Mt in 2021 from 10.9Mt in 2020, in order to recover the 2020 waste tonnes delayed by the COVID-19 pandemic and in line with the 2030 life of mine plan. Ore mined increased by 23% to 9.0Mt in 2021 from 7.3Mt in 2020, in order to comply with the low-grade ore stocking strategy, established in the 2030 life of mine sequence.

All-in cost per gold ounce decreased by 68% to US$230/oz in 2021 from US$715/oz in 2020 mainly as a result of higher by-product credits due to a higher copper price and content sold. All-in cost per equivalent ounce decreased by 7% to US$1,040 per equivalent ounce in 2021 from US$1,119 per equivalent ounce in 2020 mainly due to higher equivalent ounces sold and higher gold inventory credit as a result of higher build-up of low grade stockpile in 2021, partially offset by higher waste tonnes mined and higher capital expenditure.

Total capital expenditure increased by 12% to US$56m in 2021 from US$50m in 2020. Sustaining capital expenditure increased by 17% to US$28m in 2021 from US$24m in 2020 due to the replacement of a crusher in the process plant to manage the increase of ore hardness and the acquisition of land near the east wall pit during 2021. Non-sustaining capital expenditure increased by 7% to US$28m in 2021 from US$26m in 2020 mainly due to commencing with the Ana waste storage facility construction during 2021 in line with the life of mine expansion plan.

Despite higher equivalent ounces sold, adjusted free cash flow decreased by 32% to US$57m in 2021 compared to US$84m in 2020. This is mainly explained by a collar hedge over copper price contracted in 2021 resulting in a hedge loss of US$46m. If the hedge loss is added back, the adjusted free cash flow for 2021 would have been US$103m.

Guidance

The estimate for 2022 is as follows:

  • Gold equivalents produced ~ 255,000oz;
  • Gold produced ~ 120,000oz;
  • Copper tonnes produced ~ 27,000t;
  • Sustaining capital expenditure ~ US$33m;
  • Non-sustaining capital expenditure ~ US$13m;
  • Copper price ~ US$8,000 per tonne;
  • Gold price ~ US$1,600/oz;
  • All-in sustaining costs ~ US$900/eq oz;
  • Total all-in cost ~ US$990/eq oz;
  • All-in sustaining costs ~ US$320/oz; and
  • Total all-in cost ~ US$500/oz.

The decrease in AIC is due to lower capital expenditure, partially offset by higher cost of sales before amortisation and depreciation as a result of inflationary increases.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Chile

Salares Norte

US$326.5m was spent on Salares Norte in 2021, made up of US$374.9m in capital expenditure, US$27.2m in exploration, US$9.0m in tax paid and US$14.3m in other costs, partially offset by a US$66.0m release of working capital and a credit of US$32.9m from the realised portion of the FX hedge. At the end of December 2021, total project progress was 62.5%, slightly below the planned 67.1%.

Despite the challenges presented by COVID-19 and severe weather conditions during 2021, construction progress stood at 55.0%, at 31 December 2021 compared to plan of 61.9%. Importantly, all of the critical path items remain on track and Salares Norte is still expected to pour first gold towards the end of Q1 2023. As previously mentioned, certain non-critical path items were intentionally deferred into 2022 to manage the COVID-19 related restrictions.

Key items of the project were advanced during 2021, including the Heavy Mine Equipment Shop and the Fresh Water System, which were 97.3% and 96.2% complete at end December, respectively. The processing plant construction was 35.5% complete at 31 December 2021, with the grinding, crusher and stockpile areas having made significant progress. Mechanical installation of six out of thirteen tanks in the leaching and CIP circuit has commenced and all of the thickeners have been erected.

Pre-stripping of the pit continued to track slightly ahead of plan during 2021, with 22.9Mt moved by the end of December 2021, ahead of the planned 17.3Mt

During 2021, US$27m was spent on exploration, resulting in a total of 23,848m being drilled (plan: 18,090m). We will continue to invest in exploration within the area in an attempt to add to the production pipeline.

Guidance

The estimate for 2022 is as follows:

  • Non-sustaining capital expenditure ~ US$330m; and
  • Mine waste (Nov-Dec) ~ US$17m.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Australia region

Dec
2021
  Dec
2020
%
Variance
 
Gold produced 000’oz   1,018.5   1,016.8 – %  
AISC A$/oz   1,418   1,331 7 %  
  US$/oz   1,065   917 16 %  
AIC A$/oz   1,526   1,388 10 %  
  US$/oz   1,146   957 20 %  
Adjusted free cash flow* A$m   620.9   722.5 (14) %  
  US$m   466.3   498.1 (6) %  
* Includes Australia consolidated tax paid and working capital movements of A$175.7m (US$132.0m) in 2021 and A$186.3m (US$128.5m) in 2020, respectively.

Gold production increased marginally to 1,019koz in 2021 from 1,017koz in 2020.

All-in cost increased by 10% to A$1,526/oz (US$1,146/oz) in 2021 from A$1,388/oz (US$957/oz) in 2020 due to higher capital expenditure, as guided, and higher cost of sales before amortisation and depreciation as a result of inflationary increases. All-in cost in US Dollar terms increased by 20% as a result of the strengthening of the Australian Dollar by 9% from A$1.00 = US$0.69 in 2020 to A$1.00 = US$0.75 in 2021.

During 2021, Western Australia experienced challenging labour market conditions driven by COVID-19-related travel restrictions, as well as buoyant commodity markets. Consequently, there was an increase in labour inflation during 2021 due to a combination of higher wage increases due to labour shortages as well as retention measures introduced to curb labour turnover. We expect 2022 to be another year of higher than normal labour inflation as these labour challenges persist.

The region produced adjusted free cash flow of A$621m (US$466m) in 2021 compared with A$723m (US$498m) in 2020. The adjusted free cash flow in 2020 was also impacted by a realised hedge loss of A$292m (US$201m).

St Ives

      Dec
2021
  Dec
2020
%
Variance
 
Underground              
Ore mined 000
tonnes
  1,925   1,737 11%  
Waste mined 000
tonnes
  852   772 10%  
Total tonnes mined 000
tonnes
  2,777   2,509 11%  
Grade mined g/t   4.91   5.26 (7)%  
Gold mined 000’oz   303.7   294.1 3%  
Surface              
Ore mined 000
tonnes
  1,414   2,331 (39)%  
Surface waste (Capital) 000
tonnes
  4,475   2,699 66%  
Surface waste (Operational) 000
tonnes
  2,109   5,880 (64)%  
Total waste mined 000
tonnes
  6,584   8,579 (23)%  
Total tonnes mined 000
tonnes
  7,998   10,910 (27)%  
Grade mined g/t   2.23   1.72 30%  
Gold mined 000’oz   101.6   129.2 (21)%  
Strip ratio waste/
ore
  4.7   3.7 27%  
Total (Underground and Surface)              
Total ore mined 000
tonnes
  3,339   4,068 (18)%  
Total grade mined g/t   3.78   3.24 17%  
Total tonnes mined 000
tonnes
  10,775   13,419 (20)%  
Total gold mined 000’oz   405.3   423.2 (4)%  
Tonnes milled 000
tonnes
  4,088   4,817 (15)%  
Yield – underground g/t   4.62   4.31 7%  
Yield – surface g/t   1.59   1.38 15%  
Yield – combined g/t   2.99   2.49 20%  
Gold produced 000’oz   393.0   384.9 2%  
Gold sold 000’oz   391.1   393.8 (1)%  
AISC A$/oz   1,339   1,223 9%  
  US$/oz   1,006   843 19%  
AIC A$/oz   1,385   1,266 9%  
  US$/oz   1,040   873 19%  
Sustaining capital expenditure A$m   119.5   89.8 33%  
  US$m   89.7   61.9 45%  
Non-sustaining capital expenditure A$m   18.1   16.7 8%  
  US$m   13.6   11.5 18%  
Total capital expenditure A$m   137.6   106.5 29%  
  US$m   103.3   73.4 41%  
Adjusted pre-tax free cash flow A$m   354.4   382.5 (7)%  
  US$m   266.2   263.7 1%  

Gold production increased by 2% to 393,000oz in 2021 from 384,900oz in 2020 due to an increase in yield, partially offset by decreased tonnes processed.

At the underground operations, ore mined increased by 11% to 1.9Mt in 2021 from 1.7Mt in 2020 and waste mined increased by 10% to 0.9Mt in 2021 from 0.8Mt in 2020 with increased production from the Invincible underground mine.

At the open pits, ore mined decreased by 39% to 1.41Mt in 2021 from 2.33Mt in 2020. Capital waste tonnes mined increased by 66% to 4.48Mt in 2021 from 2.70Mt in 2020 and operational waste tonnes mined decreased by 64% to 2.11Mt in 2021 from 5.88Mt in 2020, reflecting focus in 2021 on pre-stripping of Neptune stage 7 and Delta Island open pits. Grade mined from the open pits increased by 30% to 2.23g/t in 2021 from 1.72g/t in 2020 due to the lower grades of ore mined from Neptune in 2020.

Total ore mined decreased by 18% from 4.1Mt in 2020 to 3.3Mt in 2021. This reduction was due to a strategy of transitioning from predominantly high volume open pit production to lower volume high grade underground ore and processing surface stockpiles.

Tonnes milled decreased by 15% from 4.8Mt in 2020 to 4.1Mt in 2021 due to lower ore tonnes mined as the mine focused on processing higher grade underground ore and maximising recoveries. This resulted in a 20% increase in yield from 2.49g/t in 2020 to 2.99g/t in 2021 resulting in greater overall production despite the reduced tonnes processed.

All-in cost increased by 9% to A$1,385/oz (US$1,040/oz) in 2021 from A$1,266/oz (US$873/oz) in 2020 due to increased underground production cost and higher capital expenditure. All-in cost in US Dollar terms increased by 19% as a result of the strengthening of the Australian Dollar by 9% from A$1.00 = US$0.69 in 2020 to A$1.00 = US$0.75 in 2021.

Total capital expenditure increased by 29% to A$138m (US$103m) in 2021 from A$107m (US$73m) in 2020.

Sustaining capital expenditure increased by 33% to A$120m (US$90m) in 2021 from A$90m (US$62m) in 2020 reflecting the increased development at Invincible underground and pre-stripping of Neptune stage 7 and Delta Island open pit, as well as expenditure on the construction of a paste plant at the Invincible underground mine. Non-sustaining capital expenditure increased by 8% to A$18m (US$14m) in 2021 from A$17m (US$12m) in 2020 due to increased exploration drilling.

St Ives generated adjusted pre-tax free cash flow of A$354m (US$266m) in 2021 compared with A$383m (US$264m) in 2020. Included in the 2020 adjusted pre-tax free cash flow is a realised hedge loss of A$114m (US$69m).

Guidance

The estimate for 2022 is as follows:

  • Gold produced ~ 380,000oz;
  • Sustaining capital expenditure ~ A$127m (US$97m);
  • Non-sustaining capital expenditure ~ A$21m (US$16m);
  • All-in sustaining costs ~ A$1,485/oz (US$1,130/oz); and
  • Total all-in cost ~ A$1,585/oz (US$1,205/oz).

The increase in AIC is due to lower gold sold, higher cost of sales before amortisation and depreciation as a result of inflationary increases and higher capital expenditure.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Agnew

      Dec
2021
  Dec
2020
%
Variance
 
Underground ore mined 000
tonnes
  1,048   1,294 (19)%  
Underground waste mined 000
tonnes
  892   750 19%  
Total tonnes mined 000
tonnes
  1,940   2,044 (5)%  
Grade mined – underground g/t   6.63   5.78 15%  
Gold mined 000’oz   223.4   240.4 (7)%  
Tonnes milled 000
tonnes
  1,254   1,357 (8)%  
Yield g/t   5.53   5.35 3%  
Gold produced 000’oz   223.0   233.3 (4)%  
Gold sold 000’oz   222.8   233.5 (5)%  
AISC A$/oz   1,550   1,475 5%  
  US$/oz   1,164   1,017 14%  
AIC A$/oz   1,741   1,528 14%  
  US$/oz   1,308   1,053 24%  
Sustaining capital expenditure A$m   74.9   63.0 19%  
  US$m   56.3   43.5 29%  
Non-sustaining capital expenditure A$m   42.5   12.3 246%  
  US$m   31.9   8.5 275%  
Total capital expenditure A$m   117.4   75.3 56%  
  US$m   88.2   52.0 70%  
Adjusted pre-tax free cash flow A$m   149.2   191.6 (22)%  
  US$m   112.1   132.1 (15)%  

Gold production decreased by 4% to 223,000oz in 2021 from 233,300oz in 2020 due to decreased ore tonnes processed, partially offset by an increase in yield.

Ore mined decreased by 19% to 1,048kt in 2021 from 1,294kt in 2020, with focus in 2021 on development of the Kath orebody at Waroonga and the Sheba ore body at New Holland resulting in a 19% increase in waste tonnes mined from 750kt in 2020 to 892kt in 2021.

Mined grade increased by 15% to 6.63g/t in 2021 from 5.78g/t in 2020 due to higher grade material mined in the Sheba area of the New Holland mine in 2021.

All-in cost increased by 14% to A$1,741/oz (US$1,308/oz) in 2021 from A$1,528/oz (US$1,053/oz) in 2020 due to lower gold sold and increased capital expenditure, partially offset by lower production cost driven by reduced ore tonnes mined and processed. Continued labour shortages within both Gold Fields and the contractor's workforce impacted on tonnage movement for the year. All-in cost in US Dollar terms increased by 24% as a result of the strengthening of the Australian Dollar by 9% from A$1.00 = US$0.69 in 2020 to A$1.00 = US$0.75 in 2021.

Total capital expenditure increased by 56% to A$117m (US$88m) in 2021 from A$75m (US$52m) in 2020.

Sustaining capital expenditure increased by 19% to A$75m (US$56m) in 2021 from A$63m (US$44m) in 2020 due to increased underground development, as well as underground ventilation infrastructure upgrades.

Non-sustaining capital expenditure increased by 246% to A$43m (US$32m) in 2021 from A$12m (US$9m) in 2020 due to development of the Kath orebody at Waroonga and the Sheba ore body at New Holland, the crusher circuit upgrade and increased exploration drilling.

Agnew generated adjusted pre-tax free cash flow of A$149m (US$112m) in 2021 compared with A$192m (US$132m) in 2020. Included in the 2020 adjusted pre-tax free cash flow is a realised hedge loss of A$68m (US$47m).

Guidance

The estimate for 2022 is as follows:

  • Gold produced ~ 251,000oz;
  • Sustaining capital expenditure ~ A$85m (US$65m);
  • Non-sustaining capital expenditure ~ A$42m (US$32m);
  • All-in sustaining costs ~ A$1,540/oz (US$1,170/oz); and
  • Total all-in cost ~ A$1,765/oz (US$1,340/oz).

AIC is going to remain similar due to higher gold sold, partially offset by higher cost of sales before amortisation and depreciation as a result of inflationary increases and higher capital expenditure.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Granny Smith

      Dec 2021   Dec 2020 %
Variance
 
Underground ore mined 000
tonnes
  1,657   1,700 (3)%  
Underground waste mined 000
tonnes
  965   637 51%  
Total tonnes mined 000
tonnes
  2,622   2,337 12%  
Grade mined – underground g/t   5.68   5.32 7%  
Gold mined 000’oz   302.5   290.9 4%  
Tonnes milled 000
tonnes
  1,662   1,719 (3)%  
Yield g/t   5.23   4.88 7%  
Gold produced 000’oz   279.2   269.6 4%  
Gold sold 000’oz   283.6   265.2 7%  
AISC A$/oz   1,376   1,360 1%  
  US$/oz   1,033   938 10%  
AIC A$/oz   1,545   1,465 5%  
  US$/oz   1,161   1,010 15%  
Sustaining capital expenditure A$m   85.6   68.6 25%  
  US$m   64.3   47.3 36%  
Non-sustaining capital expenditure A$m   48.1   27.8 73%  
  US$m   36.1   19.1 89%  
Total capital expenditure A$m   133.7   96.4 39%  
  US$m   100.4   66.4 51%  
Adjusted pre-tax free cash flow A$m   213.7   224.3 (5)%  
  US$m   160.5   154.7 4%  

Gold production increased by 4% to 279,200oz in 2021 from 269,600oz in 2020 due to an increase in yield, partially offset by decreased ore tonnes processed.

Waste mined increased by 51% to 965kt in 2021 from 637kt in 2020, with focus in 2021 on development of the Z135 area and the second decline. As a result of the increased waste mined, total tonnes mined increased by 12% to 2,622kt in 2021 from 2,337kt in 2020.

All-in cost increased by 5% to A$1,545/oz (US$1,161/oz) in 2021 from A$1,465/oz (US$1,010/oz) in 2020 due to increased capital expenditure and increased cost of sales before amortisation and depreciation, partially offset by increased gold sold in 2021. All-in cost in US Dollar terms increased by 15% as a result of the strengthening of the Australian Dollar by 9% from A$1.00 = US$0.69 in 2020 to A$1.00 = US$0.75 in 2021.

Total capital expenditure increased by 39% to A$134m (US$100m) in 2021 from A$96m (US$66m) in 2020.

Sustaining capital expenditure increased by 25% to A$86m (US$64m) in 2021 from A$69m (US$47m) in 2020 due to increased mine development in the Zone 110/120 areas.

Non-sustaining capital expenditure increased by 73% to A$48m (US$36m) in 2021 from A$28m (US$19m) in 2020 due to increased development in the Z135 area and the second decline. When completed, the second decline will provide a reduction in current congestion in the main decline and will support short interval control measures to maintain the production profile.

Granny Smith generated adjusted pre-tax free cash flow of A$214m (US$161m) in 2021 compared with A$224m (US$155m) in 2020. Included in the 2020 adjusted pre-tax free cash flow is a realised hedge loss of A$73m (US$50m).

Guidance

The estimate for 2022 is as follows:

  • Gold produced ~ 267,000oz;
  • Sustaining capital expenditure ~ A$94m (US$71m);
  • Non-sustaining capital expenditure ~ A$36m (US$27m);
  • All-in sustaining costs ~ A$1,530/oz (US$1,165/oz); and
  • Total all-in cost ~ A$1,710/oz (US$1,300/oz).

The increase in AIC is due to lower gold sold and higher cost of sales before amortisation and depreciation as a result of inflationary increases.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.

Gruyere

      Dec
2021
  Dec
2020
%
Variance
 
Mine physicals and AIC in table on a 100% basis              
Ore mined 000
tonnes
  10,303   8,088 27%  
Waste (Capital) 000
tonnes
  26,608   15,135 76%  
Waste (Operational) 000
tonnes
  2,495   3,224 (23)%  
Total waste mined 000
tonnes
  29,103   18,359 59%  
Total tonnes mined 000
tonnes
  39,406   26,447 49%  
Grade mined g/t   0.95   1.09 (13)%  
Gold mined 000’oz   314.7   282.6 11%  
Strip ratio waste/
ore
  2.8   2.3 22%  
Tonnes milled 000
tonnes
  8,439   8,108 4%  
Yield g/t   0.91   0.99 (8)%  
Gold produced 000’oz   246.5   258.2 (5)%  
Gold sold 000’oz   248.8   255.9 (3)%  
AISC A$/oz   1,525   1,337 14%  
  US$/oz   1,146   921 24%  
AIC A$/oz   1,541   1,350 14%  
  US$/oz   1,158   931 24%  
Capital and cash flow in table on a 50% basis              
Sustaining capital expenditure – 50% basis A$m   56.2   38.9 44%  
  US$m   42.2   26.8 57%  
Non-sustaining capital expenditure – 50% basis A$m   2.0   1.7 18%  
  US$m   1.5   1.2 25%  
Total capital expenditure – 50% basis A$m   58.2   40.6 43%  
  US$m   43.7   28.0 56%  
Adjusted pre-tax free cash flow – 50% basis A$m   79.3   110.4 (28)%  
  US$m   59.5   76.1 (22)%  

Gold production decreased by 5% to 246,500oz in 2021 from 258,200oz in 2020 due to a decrease in grade of ore mined and processed.

Total tonnes mined increased by 49% to 39.4Mt in 2021 from 26.5Mt in 2020. The mix of ore and waste was substantially different during 2021, with a 27% increase in ore mined and a 23% decrease in operational waste mined. The change in the mining mix was in line with the mining schedule following mining in different stages of the pit in 2021. Capital stripping increased by 76% in 2021 with a focus on pre-strip of stages 2 and 3 of the pit.

Grade mined decreased by 13% to 0.95g/t in 2021 from 1.09g/t in 2020, with higher grade ore sourced from stage 1 of the pit during 2020. Ore grades will improve again in 2022 as the mine moves into higher grade areas in stage 3 of the pit.

All-in cost increased by 14% to A$1,541/oz (US$1,158/oz) in 2021 from A$1,350/oz (US$931/oz) in 2020 due to lower gold sold and a A$14.7m (US$11.0m) increase in processing costs associated with plant reliability projects as well as increased capital expenditure. All-in cost in US Dollar terms increased by 24% as a result of the strengthening of the Australian Dollar by 9% from A$1.00 = US$0.69 in 2020 to A$1.00 = US$0.75 in 2021.

Total capital expenditure (on a 50% basis) increased by 43% to A$58m (US$44m) in 2021 from A$41m (US$28m) in 2020. Sustaining capital expenditure (on a 50% basis) increased by 44% to A$56m (US$42m) in 2021 from A$39m (US$27m) in 2020, reflecting the pre-stripping of stages 2 and 3 of the pit. Non-sustaining capital expenditure increased by 18% to A$2m (US$2m) in 2021 from A$2m (US$1m) in 2020 due to increased exploration drilling in 2021.

Gruyere generated adjusted pre-tax free cash flow (on a 50% basis) of A$79m (US$60m) in 2021 compared with a cash flow of A$110m (US$76m) in 2020. Included in the 2020 adjusted pre-tax free cash flow is a realised hedge loss of A$37 (US$26m).

Guidance

The estimate for 2022 is as follows:

  • Gold produced ~ 145,000oz (50%) to 165,000oz (50%);
  • Sustaining capital expenditure ~ A$42m (US$32m) (50%);
  • Non-sustaining capital expenditure ~ A$3m (US$2m) (50%);
  • All-in sustaining costs ~ A$1,245/oz (US$945/oz); and
  • Total all-in cost ~ A$1,265/oz (US$960/oz).

The decrease in AIC is due to higher gold sold and lower capital expenditure, partially offset by higher cost of sales before amortisation and depreciation as a result of inflationary increases.

The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the Group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.