Wrap Text
Quarterly Activities Report
Quarter Ended 30 June 2012
Gold One International Limited
Registered in Western Australia under the Corporations Act, 2001 (Cth)
Registration number ACN: 094 265 746
Registered as an external company in the Republic of South Africa
Registration number: 2009/000032/10
Share code on the ASX/JSE: GDO
ISIN: AU000000GDO5
OTCQX International: GLDZY
("Gold One" or the “company”)
Quarterly Activities Report
Quarter Ended 30 June 2012
June 2012 Quarter Highlights
- Cashflow from operations increased by 58%
- Group operating cashflow of US$ 24.2 million
- Cash balance decreased from US$ 147.61 to US$ 75.99 million primarily due to final tranche of payments
for the Rand Uranium acquisition
- Group cash costs decreased by 8% from US$ 1,093 per ounce to US$ 1,007 per ounce
- 62,904 ounces produced for the June 2012 quarter representing a 2% increase on the March 2012
quarter
- Modder East Operation production totalled 26,493 ounces representing a 22% reduction compared to
forecast primarily due to illegal industrial action
- Cooke Underground Operation production increased quarter-on-quarter by 12% to 26,041 ounces
- Randfontein Surface Operation production increased quarter-on-quarter by 42% to 10,370 ounces
- Positive progress made on the Gold Fields and Gold One West Rand tailings joint venture scoping study
September 2012 Quarter Outlook
- September 2012 quarter production forecast of 55,000 ounces:
- 16,000 ounces from Modder East Operation
- 30,000 ounces from Cooke Underground Operation
- 9,000 ounces from Randfontein Surface Operation
- Ezulwini transaction concluded in July 2012
- Pamodzi East Rand transaction expected to be concluded in September 2012
June 2012 Quarter Key Performance Data
(Average Exchange Rate of ZAR 8.1 / US$ 1)
(March 2011 Quarter Average Exchange Rate of ZAR 7.74 / US$ 1)
Cooke Randfontein Gold One
Modder East March 2012
Underground Surface Group
Operation Quarter
Operation Operation
Ore Mined
114 727 t 282 736 t
Underground
Mined Grade 7.44 g/t 4.51 g/t 0.569 g/t
Milled Tonnes 110 958 t 269 946 t2 786 346 t
Recovered Grade 7.03 g/t 2.98 g/t 0.410 g/t
Gold Recovery 95% 95% 72%
Gold Produced 26 493 oz1 26 041 oz2 10 370 oz 62 904 oz 61 625 oz
Cash Cost3 590/oz US$ 1 438/oz US$ 1 000/oz US$ 1 007/oz US$ 1 093/oz
Total Cost4 791/oz US$ 1 611/oz US$ 1 044/oz US$ 1 173/oz US$ 1 266/oz
Average Gold Price
US$ 1 682/oz US$ 1 264/oz US$ 1 264/oz US$ 1 363/oz US$ 1 424/oz
Received
Gross Cash Margin US$ 1 092/oz US$ -174/oz US$ 264/oz US$ 356/oz US$ 331/oz
Group Development
US$ 16.06
and Capital US$ 16.84 million
million
Expenditure
US$ 86.19
Group Gold Revenue US$ 87.82 million
million
Notes:
1
Includes 1,407 ounces produced at Modder East Operation by the treatment of 51,574 tonnes of low grade development ore and
mud at a recovered grade of 0.85 grams per tonne.
2
Includes 229 ounces produced at the Cooke Underground Operation by the treatment of 27,678 tonnes of low grade
development ore and mud at a recovered grade of 0.26 grams per tonne .
3
Cash cost refers to all costs directly associated with mining activities, mine administration, processing and refining.
4
Total cost refers to the sum of the cash cost, depreciation and royalties. Capital expenditure, finance costs and corporate costs
are excluded from total cost.
1. CEO’s Review
During the June 2012 quarter a total of 62,904 ounces of gold was produced for the Gold One group. This
reflected a 2% increase on the March 2012 quarter’s production despite the illegal industrial action that
began at Modder East on 3 June 2012.
Safety for the group, measured according to the lost-time injury rate per 200,000 hours worked (“LTIFR”),
improved from 1.99 for the March 2012 quarter to 1.30 for the quarter under review. This improvement is
the result of on-going safety initiatives across all operations. Despite this improvement, however, the
company regrets to report that Mr Mungoi, a timberman assistant, lost his life underground at Cooke 1 Shaft
in July while assisting with repairs to a pipe column. The company extends its deepest condolences to Mr
Mungoi’s family, friends and colleagues.
The loss of production from Modder East as a result of the illegal industrial action and the subsequent
dismissal of a large majority of Modder East’s workforce is highly disruptive and disappointing. However, we
are pleased with the swift response of the courts to this illegal strike with a final interdict having been issued
by the South Gauteng High Court on 26 June 2012, interdicting violence and intimidation at Modder East.
The High Court has also granted costs against the Professional Transport Allied Workers Union (“PTAWU”),
under whose auspices the violence occurred.
Gold One, with overwhelming support from our key stakeholders, is continuing to maintain a strong stance
against those involved in the illegal strike activity and against acts of violence and intimidation as we manage
short term impacts with a focus on creating long term stability. In light of the production losses from
Modder East, the company intends to pursue a compensation claim against PTAWU in terms of Section
68(1)(b) of the South Africa Labour Relations Act 66 of 1995. The company and various private individuals
that suffered damages to property as a result of violent protest action, perpetrated by the dismissed
employees, may also consider compensation claims.
During the initial phases of the unprotected industrial action the company introduced a number of
contingencies at Modder East to mitigate the impact of the strike. These contingencies have continued to
ensure that Modder East operates profitably, albeit at much lower production levels. Management is in on-
going discussions with organised labour with a view to reach a sustainable long term solution. A short term
plan, however, which includes the controlled engagement of contractors, has been developed to normalise
production. With the controlled phasing in of contract labour, management expects production to return to
pre-strike rates by the end of September 2012. This plan foresees a systematic build-up of approximately
five crews per week into stoping and development operations over the next eight to 10 weeks in order to
ensure that new recruits are properly trained and not exposed to safety risks (Modder East requires 50
stoping crews at steady state production; seven crews are currently in place).
As a result of this progressive build up at Modder East a review of the next six months of production
objectives has been undertaken. It is envisaged that the group will achieve a 55,000 ounce output during the
September 2012 quarter and a 70,000 ounce output for the December 2012 quarter, giving a revised group
outlook of 250,000 ounces for the total 2012 year. In addition, Ezulwini Mining Company (Pty) Limited
(“Ezulwini”) will be incorporated into the Cooke Underground Operation during the last five months of 2012
and is expected to contribute an additional 15,000 ounces during this period providing a total group gold
production of 265,000 ounces, as opposed to production forecasts of 300,000 ounces prior to the illegal
industrial action and the inclusion of Ezulwini.
The group gold revenue for the June 2012 quarter amounted US$ 87.82 million from the sale of 64,434
ounces at an implied average price of US$ 1,363/oz. This comprised 31,812 ounces of gold sold into the spot
market at an implied average price of US$ 1,678/oz and 32,622 ounces delivered into the Cooke
Underground and Randfontein Surface operations’ hedge book at an implied average price of US$ 1,245/oz.
Cash cost for the quarter reduced to US$ 1,007/oz from US$ 1,093/oz, yielding an improved gross cash
margin of US$ 356/oz. Capital expenditure for the quarter was US$ 16.84 million (US$ 268/oz) of which US$
11.3 million was spent on orebody development and equipping. Positive cashflow from operations for the
June 2012 quarter therefore totalled US$ 8.74 million; a 58% improvement on the previous quarter.
The company’s cash balance remained robust with Gold One ending the quarter with a cash balance of US$
75.99 million (including restricted cash of US$ 30.12 million) compared to a cash balance of US$ 147.61
million (including restricted cash of US$ 31.74 million) at the end of the March 2011 quarter. In addition to
this the company ended the quarter under review with gold receivables amounting to US$ 6.09 million. The
decrease in cash was primarily due to the final tranche of payments being made by Gold One for the Rand
Uranium (“Pty”) Limited (“Rand Uranium”) acquisition.
At quarter-end Gold One reflected long term debt of US$ 124.61 million comprising the shareholder loan
received during the March 2012 quarter, amounting to US$ 75.46 million and US$ 49.15 million drawn from
the Investec facility, during the quarter under review. Gold One has access to US$ 161.7 million in approved
Investec undrawn facilities.
During the quarter under review Gold One has focused on minimising the effects of illegal industrial action
at Modder East and has also focussed on the turnaround programme in place at the Cooke Underground and
Randfontein Surface operations.
At Modder East the contingency plans implemented by management during June 2012 included the
supplementing of reduced mining tonnages with tonnage from underground accumulations, low grade
surface stockpiles and additional on-reef development. A total of 110,958 tonnes of milled ore at a
recovered grade of 7.03 grams per tonne was supplemented with 51,574 tonnes of low grade ore at 0.85
grams per tonne to yield 26,493 ounces of gold. Unfortunately strong operational performances during April
and May were neutralised by the impact of the illegal industrial action in June. Operational normalisation
will be dependent on the successful integration of the new contract crews.
Total development for the June 2012 quarter reduced to 950 metres from the March 2012 quarter’s 1,108
metres, with on-reef development reducing from 451 metres to 367 metres. During the strike a level of
mechanised on-reef development was maintained ensuring continued opening up of the orebody for future
mining. This will further increase the mining flexibility at Modder East once the operation returns to pre-
strike production levels.
Cash costs at Modder East reduced from US$ 683/oz during the previous quarter to US$ 590/oz during the
current quarter.
I am especially pleased with the progress that we have made with the Rand Uranium acquisition,
remembering that we are still only six months into the Cooke Underground and Randfontein Surface
operations’ two year turnaround initiative.
The two year turnaround programme at the Cooke Underground Operation is continuing to make good
progress as gold production increased quarter-on-quarter by 12% to 26,041 ounces, which was marginally
below the operation’s forecast of 27,000 ounces.
In-stope dilution remains a challenge despite improvements in certain areas and the mine call factor
turnaround is continuing to be a key initiative for the operation. The increase in tonnage from vamping of
old areas has been encouraging and forms a key part of this initiative. In addition to this, surface exploration
targeting the shallow Ventersdorp Contact Reef in the Cooke 2 Shaft vicinity has commenced and the first
reef has been successfully intersected at a depth of 471 metres below surface. The Cooke Underground
Operation’s co-product strategy of opening up high grade uranium areas is being fast tracked following the
closure of the Ezulwini acquisition at the end of July 2012.
During the quarter under review development increased by a further 6% to 4,673 metres, with 260 metres
of on-reef payable face length being generated. It is anticipated that an additional 190 metres of face length
will be opened during the September 2012 quarter. It is extremely pleasing that since January 2012, total
development rates have increased by 25%. Development at the Cooke Underground Operation remains a
priority in order to improve mining flexibility, a key deliverable in terms of our planned two year turnaround
strategy.
The increased tonnage at the Cooke Underground Operation contributed to a quarter-on-quarter reduction
in South Africa Rand per tonne costs from ZAR 1,137/t to ZAR 1,125/t, and increased gold output
contributed to a cash cost reduction from US$ 1,513 for the previous quarter to US$ 1,438/oz for the current
quarter.
The Randfontein Surface Operation performed well and exceeded quarterly guidance by 42%, more than
making up the 674 ounce underperformance experienced in the March 2012 quarter. During the quarter
production at the Randfontein Surface Operation benefited from three improvement initiatives:
- Tonnage mined and treated from Dump 20 improved as a result of the appointment of a new sand
mining contractor
- Recoveries improved as a result of modifications to the leach circuit
- Delivered grades improved as a result of changes made to the mining plan to accommodate the
inclusion of enriched floor material from Dump 20.
The overall effect of this was an increase in sand tonnes milled from 756,390 tonnes to 786,346 tonnes,
reflecting a 4% increase. In addition, higher mining grades resulted in the recovered grade increasing from
0.3 grams per tonne to 0.41 grams per tonne; a 26% improvement. Gold recovery increased from 69.3% to
72%.
These improvements contributed to a reduction in cash costs from US$ 1,388/oz to US$ 1,000/oz for the
operation.
Corporate Development
During March 2012, Gold One announced that a binding agreement had been signed with First Uranium
Corporation (”First Uranium”) to acquire 100% of the issued shares of, and all shareholders’ claims against
First Uranium Limited, the holding company of Ezulwini, for a total consideration of US$ 70 million. Just four
months later I am delighted to report that the acquisition of the Ezulwini mine from First Uranium is
unconditional and will be implemented in August 2012. This acquisition is aligned to our business strategy of
value-accretive growth and is a key component in the realisation of synergies across the Cooke Underground
and Randfontein Surface operations. With access to Ezulwini’s uranium processing facility, we can now look
towards unlocking the value of our joint underground resources and begin capitalising on our gold and
uranium co-product strategy in the near term. The Cooke Operation’s management team, with their
extensive knowledge of the Ezulwini orebody, people and processes, are well prepared for the integration of
Ezulwini into the Cooke Underground Operation.
During the quarter we also progressed the West Rand surface tailings scoping study, jointly initiated by
Gold One and Gold Fields Limited (“Gold Fields”). The study is investigating the feasibility of establishing a
joint venture into which both parties will contribute surface assets for retreatment. The joint assets
comprise in excess of 800 million tonnes of historical tailings and current arisings and represents over 60% of
the total tailings material in the West Rand and far West Rand region. The intention is to reclaim and retreat
the historical and current tailings material to recover residual gold, uranium and sulphur. A further objective
of the project will be to address the redeposition of the residues in accordance with modern sustainable
deposition practices, ultimately supporting mine closure in an environmentally sustainable manner. During
the quarter under review, the scoping study was completed and is currently being reviewed by the project
steering committee established to represent both parties. A successful outcome of an enhanced value
proposition may lead to a decision by Gold One and Gold Fields to progress the study to a
prefeasibility/feasibility study investigation. A final decision is anticipated during the September 2012
quarter.
On 17 April 2012 Gold One announced that the company had entered into an acquisition agreement through
its wholly owned subsidiary New Kleinfontein Mining Company Limited (“NKMC”) and with Goliath Gold
Mining Limited (“Goliath Gold”) to acquire control over the underground deposits of Grootvlei (Pty) Mines
Limited, Consolidated Modderfontein Mines 1979 Limited and Nigel Gold Mining Company (Pty) Limited
(“the Pamodzi East Rand Operations”) for a total of ZAR 70 million. This strategic transaction essentially
gives Gold One and Goliath Gold access to explore one of the largest brownfield exploration properties in
the world that still hosts significant potential resources. Specifically, Gold One will have access to exploring
and delineating the contiguous down dip extension to Modder East. This largely unmined area is highly
prospective with regards to the UK9a (Kimberly Reef) orebody. The UK9a currently comprises some 26% of
Modder East’s existing mineral reserve and this down dip extension has the potential to substantially
increase Modder East’s current mine life of 10 years. This area can be accessed utilising Modder East’s
existing infrastructure, thereby minimising required project capital and remaining disconnected from the
flooded historical mine voids. The company intends confirming this down dip extension through a surface
exploration drilling programme. This acquisition will provide Gold One and Goliath Gold with an opportunity
to replicate the successful development philosophy employed at the Modder East Operation. During the
September 2012 quarter the company will continue to progress the outstanding conditions precedent to the
transaction. The anticipated completion of all conditions precedent is 30 September 2012, which can be
extended by mutual agreement by both parties.
2. Financial Review
Cooke Randfontein Total
Modder East March 2012
Cashflow Underground Surface June 2012
Operation Quarter
(Unaudited) Operation Operation Quarter
(US$ Million) (US$ Million)
(US$ Million) (US$ Million) (US$ Million)
Gold Sales 43.14 31.87 12.81 87.82 86.19
Payment to
Operating
-15.77 -37.48 -10.37 -63.62 -65.02
Suppliers and
Employees
Operating
27.37 -5.61 2.44 24.20 21.17
Cashflow
Development
and Capital -6.54 -8.56 -0.36 -15.46 -15.64
Expenditure
Cashflow from
20.83 -14.17 2.08 8.74 5.53
Operations
Group gold revenue for the June 2012 quarter amounted to US$ 87.82 million from the sale of 64,434
ounces at an implied average price of US$ 1,363/oz. This comprised 31,812 ounces of gold sold into the spot
market at an implied average price of US$ 1,678.78/oz and 32,622 ounces delivered into the Cooke
Underground and Randfontein Surface operations hedge book at an implied average price of
US$ 1,245.01/oz.
Payments to operating suppliers and employees totalled US$ 63.62 million for the quarter, resulting in an
operating cashflow of US$ 24.20 million. The Modder East and Randfontein Surface operations contributed
US$ 27.37 million and US$ 2.44 million respectively to this cashflow. The Cooke Underground Operation
consumed US$ 5.61 million of this cashflow. This is the first positive contribution by the Randfontein Surface
Operation to the operating cashflow of the group, with a year to date net contribution after capital of
US$ 0.30 million since the integration of Rand Uranium into Gold One. The Randfontein Surface Operation is
expected to continue its positive contribution in line with its turnaround strategy, while the Cooke
Underground Operation is expected to contribute positively to group cashflow in the short term as its
turnaround strategy progresses.
6|Page
Group development and capital expenditure totalled US$ 16.84 million with the Modder East, Cooke
Underground and Randfontein Surface operations’ expenditures totalling US$ 6.54 million, US$ 8.56 million
and US$ 0.36 million respectively. The Randfontein Surface Operation incurred US$ 1.24 million in capital
expenditure. Capital expenditure has also been incurred on establishing the company’s Hong Kong office.
Positive cashflow from operations for the June 2012 quarter therefore totalled US$ 8.74 million, reflecting a
58% improvement on the previous quarter.
Gold One ended the quarter under review with a cash balance of US$ 75.99 million (including restricted cash
of US$ 30.12 million) and excluding gold receivables amounting to US$ 6.09 million. This compares to a cash
balance of US$ 147.61 million (including restricted cash of US$ 31.74 million) and gold receivables of
US$ 8.26 million at the end of the March 2012 quarter, reflecting a 49% quarter-on-quarter decrease in the
cash balance. Major cash movements during the quarter related to:
- The second tranche of payments for the purchase of Rand Uranium, amounting to US$ 74.51 million,
paid out of the cash reserves of the company on 5 April 2012
- The final tranche of payments for the abovementioned purchase, amounting to US$ 40.79 million,
drawn down from the Investec facility on 24 April 2012
- The settlement of success fees amounting to US$ 1.17 million
- A payment of US$ 0.89 million as a deposit on the acquisition of the Pamodzi East Rand Operations’
underground deposits and selected assets by Gold One and Goliath Gold
- Loans of US$ 3 million and US$ 2 million advanced to First Uranium during May and June 2012
- Cash of US$ 4.65 million consolidated into the group on the closing of the Goliath Gold transaction
- Cash acquired on a drawdown of the Investec Bank Limited (“Investec”) facility on 10 May 2012
amounting to US$ 10.06 million
- Cash received from the sale of Gold One shares by Goliath Gold amounting to US$ 1.10 million
During the quarter under review the following were also paid:
- Payments in relation to the company’s exploration activities, amounting to US$ 1.53 million
- Transaction fees in relation to transactions currently underway, amounting to US$ 0.68 million.
At quarter-end Gold One reflected long term debt of US$ 124.61 million comprising the shareholder loan
received during the March 2012 quarter, amounting to US$ 75.46 million, and the balance of the Investec
facility, amounting to US$ 49.15 million, all of which were drawn down during the quarter under review.
Gold One has access to US$ 161.7 million in undrawn facilities.
The profit for the half-year will be released at the end of August 2012 when the group’s half-year financial
statements are published.
The Cooke and Randfontein Surface operations’ hedge book totalled 93,451 ounces at 30 June 2012 based
on the dispatch date at an average deliverable price of US$ 1,346/oz1.
(1) The hedge price is quoted as ZAR/oz, therefore the hedge price has been converted at the Gold One budgeted exchange rate for
2012 of ZAR 7.47/US$ .
Gold One Group Gold Sales and Revenue Schematic
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
3. Group Operational Review
The LTIFR for the group improved from 1.99 for the March 2012 quarter to 1.30 for the quarter under
review. This improvement is the result of on-going safety initiatives across all operations. Despite this
improvement, however, the company regrets to report that Mr Mungoi, a timberman assistant, lost his life
underground at Cooke 1 Shaft in July while assisting with repairs to pipe columns.
For the quarter under review gold production for the group amounted to 62,904 ounces, reflecting a 2%
improvement on the March 2012 quarter despite the illegal industrial action that began at Modder East on 3
June 2012 and which negatively impacted the operation.
Cash cost for the quarter reduced to US$ 1,007/oz from US$ 1,093/oz, yielding an improved gross cash
margin of US$ 356/oz. Capital expenditure for the quarter was US$ 16.84 million (US$ 268/oz) of which US$
11.3 million was spent on orebody development and equipping.
The performance of each operation is detailed in the report below and the impact of the illegal strike at
Modder East and the subsequent dismissal of 1,044 employees from the operation are explained in the
appropriate section. Management is in on-going discussions with organised labour with a view to reach a
sustainable long term solution to the recent impasse. A short term plan, however, which includes the
controlled engagement of contractors, has been developed to normalise production. This plan foresees a
systematic build-up of approximately five crews per week into stoping and development operations over the
next eight to 10 weeks in order to ensure that new recruits are properly trained and not exposed to safety
risks. Typically Modder East has 50 stoping crews at steady state production.
As a result of this progressive build up, a review of the next six months of production objectives has been
undertaken. It is envisaged that the group will achieve a 55,000 ounce output during the September 2012
quarter and a 70,000 ounce output for the December 2012 quarter, giving a revised outlook of 250,000
ounces for the total 2012 year. In addition Ezulwini will be incorporated into the Cooke Underground
Operation during the last five months of 2012, during which period it is expected to contribute an additional
15,000 ounces providing a total group gold production of 265,000 ounces, as opposed to production
forecasts of 300,000 ounces prior to the illegal industrial action and the inclusion of Ezulwini.
At Modder East the contingency plans implemented by management during June 2012 included the
supplementing of reduced mining tonnages with tonnage from underground accumulations, low grade
surface stockpiles and additional on-reef development. A total of 110,958 tonnes of milled ore at a
recovered grade of 7.03 grams per tonne was supplemented with 51,574 tonnes of low grade ore at 0.85
grams per tonne to yield 26,493 ounces of gold. Unfortunately strong operational performances during April
and May 2012 were neutralised by the impact of the illegal industrial action. Operational turnaround will be
dependent on the successful integration of the new crews.
Total development for the June 2012 quarter reduced to 950 metres from the March 2012 quarter’s 1,108
metres, with on-reef development reducing from 451 metres to 367 metres. During the September 2012
quarter additional on-reef development ends will be converted to trackless mining in order to increase
overall development at Modder East, which will improve mining flexibility in the medium to long term. Cash
costs at Modder East reduced from US$ 683/oz during the previous quarter to US$ 590/oz during the
current quarter.
At the Cooke Underground Operation both tonnage mined and tonnage milled increased quarter-on-
quarter. Recovered grade reduced from 3.0 grams per tonne to 2.98 grams per tonne, yielding 26,041
ounces and reflecting a 12% improvement on the March 2012 quarter. In-stope dilution remains a challenge
despite improvements in certain areas and the mine call factor turnaround is continuing to be a key initiative
for the operation. The increase in tonnage from vamping of old areas has been encouraging and also forms a
key part of this initiative. In addition to this surface exploration targeting the shallow Ventersdorp Contact
Reef in the Cooke 2 Shaft vicinity has commenced and the first reef has been successfully intersected at a
depth of 471 metres below surface. The Cooke Underground Operation’s co-product strategy of opening up
high grade uranium areas will also be fast tracked following the final closure of the Ezulwini acquisition at
the end of July 2012. Specific target areas in this regard have already been identified. An integration plan
has also been developed, which will see Ezulwini being integrated into the Cooke Underground Operation
from early August 2012 as Cooke 4 Shaft.
Development at the Cooke Underground Operation remains a priority in order to improve mining flexibility.
During the quarter under review development increased by almost 8% to 4,673 metres, with 260 metres of
on-reef payable face length being generated. It is anticipated that an additional 190 metres of face length
will be opened during the September 2012 quarter.
During the June 2012 quarter the increased tonnage at the Cooke Underground Operation contributed to a
quarter-on-quarter reduction in South Africa Rand per tonne costs from ZAR 1,137/t to ZAR 1,125/t, and
increased gold output contributed to a cash cost reduction from US$ 1,513 for the previous quarter to US$
1,438/oz for the current quarter.
There was significant turnaround at the Randfontein Surface Operation during the June 2012 quarter due to
the successful implementation of three improvement plans. Tonnage mined and treated from Dump 20
improved as a result of the appointment of a new sand mining contractor, and recoveries improved as a
result of modifications to the leach circuit. Delivered grades improved as a result of changes made to the
mining plan in order to include enriched floor material from Dump 20. The overall effect of this was an
increase in sand tonnes milled from 756,390 tonnes to 786,346 tonnes, reflecting a 4% quarter-on-quarter
increase. In addition higher mining grades resulted in the recovered grade increasing from 0.3 grams per
tonne to 0.41 grams per tonne; a 26% improvement on the previous quarter. Gold recovery increased from
69.3% to 72%. These improvements contributed to a reduction in cash costs from US$ 1,388/oz to US$
1,000/oz.
The Cooke Optimisation Project progressed well during the June 2012 quarter in both engineering design
and costing and the project is expected to be finalised during the September 2012 quarter with construction
scheduled to commence in 2013. This will see an increase in throughput with a combination of sand and
slime as feed material and with deposition into old open pits.
June 2012 Quarter March 2012 Quarter
Variance
Actual Actual
Gold One Group 62 904 oz 61 625 oz 1 279 oz 2%
June 2012 Quarter June 2012 Quarter
Variance
Actual (oz) Guidance (oz)
Modder East Operation 26 493 34 000 -7 507 -22%
Cooke Underground Operation 26 041 27 000 -959 -4%
Randfontein Surface Operation 10 370 8 000 2 370 30%
Total 62 904 69 000 -6 096 -9%
Group Quarterly Production Profile Schematic
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3.1. Modder East Operation
June 2012 March 2012
Modder East
Quarter Quarter
Ore Mined Underground 114 727 t 116 514 t
Mined Grade 7.44 g/t 7.39 g/t
Milled Tonnes 110 958 t 139 115 t
Recovered Grade 7.03 g/t 6.80 g/t
Gold Recovery 95% 95%
Gold Produced 26 493 oz1 31 128 oz2
Cash Cost3 US$ 590/oz US$ 683/oz
Notes:
1
Includes 1,407 ounces produced at Modder East Operation by the treatment of 51,574 tonnes of low grade development
ore and mud at a recovered grade of 0.85 grams per tonne.
2
Includes 714 ounces produced at Modder East by the treatment of 35,731 tonnes of low grade development ore at a
recovered grade of 0.64 grams per tonne.
3
Cash cost refers to all costs directly associated with mining activities, mine administration, processing and refining.
3.1.1. Modder East: Operational Review
At the end of the June 2012 quarter, Modder East’s progressive LTIFR for the 2012 year amounted to 1.29,
reflecting an improvement on the operation’s 2012 LTIFR as at the end of previous quarter of 1.39. The
LTIFR for the quarter alone was 1.07. June was the safest month of the year so far, indicating that the
contingencies put in place to alleviate the effect of the illegal strike were implemented without
compromising safety. The operation continues to enforce Gold One’s safety philosophy that ‘nothing is so
important that it cannot be done safely’.
Modder East production for the quarter was adversely affected by illegal strike action, which impacted the
entire June month of the June 2012 quarter. A number of contingency plans were deployed to enable the
operation to continue profitably, albeit at lower production levels. The company’s contingencies included a
focus on processing underground reef accumulations and low grade surface stockpiles, increasing the
amount of mechanised on-reef development – which is a key contributor to daily production volumes – and
ensuring that the opening up of the orebody for future mining continued despite the strike action.
Mechanised off-reef development of the main decline also continued very successfully during the strike
period with the assistance of supervisory labour. At quarter-end, the main decline was 47 metres away from
the breakaway of the planned life of mine ore handling excavations.
Total production volumes for reef mined at Modder East during the June 2012 quarter amounted to 114,727
tonnes at an average grade of 7.44 grams per tonne. In addition, a further 12,365 tonnes of low grade
development ore was stockpiled at an average mined grade of 0.37 grams per tonne. Underground ore
mined showed a quarter-on-quarter decrease of only 2%, despite significantly reduced numbers for June
2012, due to a strong performance in April and an even stronger performance in May 2012 in line with the
company’s budgeted build up for 2012.
Mined grade for the quarter marginally increased from 7.39 grams per tonne in the March 2012 quarter to
7.44 grams per tonne during the quarter under review. The maintained mined grade is particularly pleasing
in light of the relatively high amount of mechanised on-reef development that took place during June as part
of the measures taken to alleviate the effects of the illegal strike action. Milled tonnes decreased quarter-
on-quarter by 20% despite strong underground performances during April and May 2012. The milled
tonnage from underground was supplemented by 51,574 tonnes of low grade stockpile material and mud
reclaimed from surface dams. The recovered grade for the total 162,532 tonnes treated amounted to 5.07
grams per tonne. Despite the reduction in the overall recovered grade as a result of the supplementary low
grade feed material, it is pleasing to report that the 110,958 tonnes of Black Reef ore treated during the
quarter yielded an average recovered grade of 7.03 grams per tonne; a 3% improvement on the previous
quarter.
Modder East 2011 and 2012 Quarterly Tonnes Mined Schematic
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
The overall impact of the illegal strike and the subsequent dismissal of the majority of the workforce are
evident in the reduction in ounces produced from 31,128 ounces in the March 2012 quarter to 26,493
ounces for the quarter under review against guidance of 34,000 ounces. Operational trends from February
through to May 2012, including the increase in grade of the Black Reef, clearly demonstrate that the
operations would have exceeded guidance had the unprotected strike not occurred.
The cash cost for the quarter decreased by 14% from US$ 683/oz for the March 2012 quarter to US$ 590/oz
for the June 2012 quarter largely due to a combination of the increased tonnage and grade, as well due to
the additional cost control measures that were implemented during the March 2012 quarter. The
weakening of the South African Rand against the American Dollar from ZAR 7.74 in the March 2012 quarter
to ZAR 8.10 in the June 2012 quarter also had an impact on the improvement.
3.1.2. Modder East: Stoping and Ledging
A total of 27,573 square metres was mined during the June 2012 quarter. The reduction in squares metres
mined was a result of the full month of production shifts lost due to the unprotected strike experienced
during the quarter. The introduction of stope drill rigs – a mechanised alternative to the traditional thrust
legs used in narrow reef stoping – during the start of the quarter proved very successful during the strike
period as it ensured quality mining of the Black Reef. Stoping widths were maintained at 122 centimetres.
Modder East Square Metres Mined per 2011 and 2012 Quarter Schematic
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
3.1.3. Modder East: Development
Despite the strike action on-reef development continued during the June month with the quarter reflecting
an 19% decrease to 36.7 metres when compared to the March 2012 quarter. No long term effects on build
up as a result of the shortfall in development are expected. At the end of the quarter 300,938 square
metres were available for mining equating to approximately 16.7 months of required mining reserves at
planned production rates of 18,000 square metres per month, should no further reef development be
undertaken. Total off-reef development amounted to 583 metres, a decrease of 11% from the previous
quarter, of which trackless off-reef development contributed 507 metres.
Modder East Total Development Metres per 2011 and 2012 Quarter Schematic
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
3.1.5. Modder East: Metallurgical Plant
During the quarter under review 162,532 tonnes were milled and treated at the Modder East Metallurgical
Plant reflecting a 7% decrease when compared to the previous quarter’s 174,846 tonnes milled. Tonnes
treated included 110,958 tonnes of Black Reef with the balance comprising 51,574 tonnes of low grade
development ore from the Middle Kimberley Reef horizons and mud. Black Reef yielded recovered grades of
7.03 grams per tonne while the total tonnes milled and treated yielded an average recovered grade of 5.07
grams per tonne. Metallurgical recoveries remained consistent at 95%.
June 2012 March 2012
Cooke Underground
Quarter Quarter
Ore Mined Underground 282 736 t 277 021 t
Mined Grade 4.51 g/t 4.60 g/t
Milled Tonnes 269 946 t2 238 519 t
Recovered Grade 2.98 g/t 3.00 g/t
Gold Recovery 95% 94%
Gold Produced 26 041 oz3 23 171 oz1
Cash Cost US$ 1 438 US$ 1 513/oz
Notes:
1
Includes 177 ounces produced at the Cooke Underground Operations by the treatment of 11,277
tonnes of low grade development ore and mud.
2
Milled tonnes excludes low grade development ore and sludge.
3
Includes 229 ounces produced at the Cooke Underground Operations by the treatment of 27,678
tonnes of low grade development ore and sludge.
3.2.1. Cooke Underground: Operational Review
At the end of the June 2012 quarter, the Cooke Underground Operation’s progressive LTIFR for the 2012
year amounted to 1.9, reflecting an improvement on the operation’s LTIFR for 2012 as at the end of the
previous quarter of 2.29. The LTIFR for the quarter alone was 1.52. The milestone achievement of 2 million
fatality-free shifts was surpassed by Cooke 3 Shaft on 15 May 2012.
Gold production for the June 2012 quarter amounted to 26,041 ounces. Gold production was 4% or 959
ounces lower than the forecast of 27,000 ounces largely due to lower than anticipated production volumes
and recovered grade. Increasing grade flexibility, primarily through continued increases in development
rates, remains a focus area of the planned two year turnaround programme. A 5% reduction in quarter-on-
quarter cash operating costs from US$ 1,508/oz to US$1,437/oz was achieved despite recovered grades
having decreased from 3.00 grams per tonne to 2.98 grams per tonne. The operating cost reduction was
partly achieved through a continued focus on reduction in operating costs with a quarter-on-quarter
reduction from ZAR 1,137 per tonne to ZAR 1,125 per tonne, as well as a weakening exchange rate. A total
of 26,041 ounces was produced from 297,623 tonnes milled at an average recovered grade of 2.72 grams
per tonne, which includes the low grade development ore processed as well as underground sludge.
Of the total tonnes milled, Cooke 1 milled 72,135 tonnes at an average recovered grade of 2.76 grams per
tonne, Cooke 2 milled 88,821 tonnes at an average recovered grade of 3.14 grams per tonne, and Cooke 3
milled 108,989 tonnes at an average recovered grade of 2.99 grams per tonne. In addition, underground
sludge and low grade development ore milled at the Cooke Gold Plant and the Doornkop Plant contributed
27,678 tonnes at an average recovered grade of 0.26 grams per tonne. Excluding the underground sludge
and low grade development ore the recovered grade for underground ore was 2.98 grams per tonne.
An improvement in tonnes milled was evident during the quarter and is expected to be maintained during
the September 2012 quarter. As mining volumes increase further reductions in unit operating costs are
anticipated. Although a consistent increasing monthly trend was observed during the quarter in terms of
mined volumes, the full benefit of this has not yet been realised due to the lower than planned shaft and
plant call factors. Although the operation’s mine call factor is not yet at the desired consistency, during the
quarter the on-going dedicated mine call factor focus resulted in Cooke 1 and Cooke 3 both achieving in
excess of budgeted mine call factor for the months of April and May, and Cooke 2 achieving in excess of
budgeted mine call factor in April. Plant efficiencies and accountability are gradually increasing and are
being further bolstered by the continued implementation of the capital refurbishment programme at
Harmony Gold Mining Co. Limited’s (“Harmony”) Doornkop Plant.
Cooke Underground 2012 Quarter Reef Tonnes Milled Schematic
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
3.2.2. Cooke Underground: Turnaround Strategy
The turnaround strategy for the Cooke Underground Operation has progressed well during the quarter
under review with cost reduction initiatives having been well entrenched and focus now shifting to revenue
enhancing initiatives. The revenue strategy focuses on the improvement of the mine call factor and monthly
crew face advances, which are anticipated to contribute ~60% to the estimated US$ 61 million per year
turnaround target.
The sustainable annualised benefits realised during the year to date from cost reduction and revenue
enhancing turnaround initiatives are in excess of US$ 25 million. This has already facilitated an overall
reduction in annualised working costs of approximately 5% to date, despite inflationary pressures
particularly related to electrical power and increased employee wages. These benefits are monitored and
tracked on a monthly basis. The following cost initiatives have been highly successful thus far:
- Overhead cost initiatives with approximately 89% of the initial target realised in the first six months of
the project. A focus on information technology shared services is expected to contribute the balance.
- An electricity cost reduction initiative where in excess of 300% of the initial target has been achieved to
date.
The revenue initiatives are focused on:
- The plant recovery factor at the Doornkop Plant. The impact of the capital project on the plant is already
evident in the plant recovery factor, which exceeded the target of 95% for the June 2012 quarter.
- The mine call factor. This project is focused on identifying the potential sources of gold losses within the
mining areas.
- The crew face advance. A new face advance bonus for crews, which has successfully been proven at
Modder East, has been implemented and an increase in crew advance has already become evident. This
system was implemented only recently and as such the current focus is on tracking daily crew
performance.
3.2.3. Cooke Underground: Stoping and Ledging
Square metres mined for the June 2012 quarter across all three shafts totalled 35,591 square metres,
representing a 3% decrease relative to the March 2012 quarter. During the quarter, however, secondary
stoping operation of double cuts was also undertaken resulting in an equivalent additional 3,768 square
metres.
Increasing mining flexibility remains a priority focus of the turnaround strategy to facilitate increased grade
and volumes. During the quarter under review the average monthly face length mined was 1,738 metres,
reflecting an improvement of 207 metres when compared to the previous quarter. At the end of the June
2012 quarter the mined face length was at 1,881 metres as a result of increased face length mined at all
three shafts.
Face advance for the quarter was 6.83 metres. The reduction in face advance relative to the March 2012
quarter was largely due to a high level of movement of panel crews into newly established stopes
(associated with an increase in face length mined during the quarter).
Vamping, a mining method used to recover ore left in mined areas, continues to be a focus at the Cooke
Underground Operation. Vamping tonnage increased by 19% compared to the previous quarter and the
associated gold recovered by this operation increased by 55%. In total the operation exceeded the previous
quarter’s vamping gold performance by 2,247 ounces.
3.2.4. Cooke Underground: Development
Off-reef development performance for the June 2012 quarter amounted to 2,218 metres as all three shafts
showed an improvement in performance and an overall 22% increase was achieved compared to the
previous quarter. During the quarter under review track bound drill rigs were introduced in selected areas to
speed up access development and to thereby fast track the creation of additional ore reserves.
2,455 metres of on-reef development was achieved during the quarter reflecting a 157 metres decrease
when compared to the previous quarter. At Cooke 1 Shaft one development end was stopped permanently
due to seismicity, and at Cooke 2 Shaft footwall lifting was implemented to expose the full reef channel thus
replacing reef development metres. During the quarter 520 metres of payable face length were made
available through development.
Development sampling results for the quarter are illustrated in the table below, indicating significant grades
in many of the new mining areas to support the planned production profile. In particular, promising grade
intersections have been achieved in the primary reefs such as the Upper Elsburg Reef (“UE1A”) horizon as
well as historical “secondary reef horizons” such as the Ventersdorp Contact Reef (“VCR”) and the Kimberley
(“K4 and K9”) reefs. Significant uranium grades, particularly associated with the UE1A across Cooke 2 and
Cooke 3 and the A5 Elsburg Reef at Cooke 3, will facilitate the benefits of the uranium co-product strategy
that will ultimately offset operating costs due to additional uranium revenue.
Cooke Underground June 2012 Quarter Development Sampled Metres
Gold Uranium
Sampled g/t
Reef Type CW g/t cmg/t SW kg/t cmkg/t
(M) (SW)
UE1A 362 151 5.95 899 171 5.26 0.206 35.51
E8 158 146 2.24 327 166 1.97 0.067 11.16
K9 216 191 3.72 709 211 3.36 0.148 31.24
Cooke 1 736 162 4.46 720 182 3.97 0.159 29.03
VCR 60 110 13.34 1467 130 11.29 N/A N/A
UE1A 98 107 7.99 855 127 6.73 0.415 52.75
Cooke 2 158 108 10.60 1088 128 8.49 0.415 52.75
VCR 377 32 16.48 523 100 5.25 0.057 5.73
UE1A 354 110 8.76 964 130 7.41 0.537 69.85
A5 233 213 3.02 642 233 2.76 0.259 60.3
A3B 38 187 12.77 2387 207 11.53 0.458 94.7
K4 46 46 17.78 818 100 8.18 0.074 7.44
Cooke 3 1048 105 7.45 781 144 5.44 0.298 42.82
Cooke Total 1942 126.6 6.18 782.6 156.8 4.99 0.245 38.4
Notes:
1. The sampling interval for on-reef development is 3 metres.
2. Weighted average values for individual reef ends are calculated using all sample sections within the development end. Averages
per reef horizon and shaft are determined based on weighted averages according to sampled metres.
3. The theoretical stoping width used is based on a minimum stoping width of 100 centimetres, or channel width plus 20
centimetres (10 centimetres above and below the reef, with a minimum width of 100 centimetres).
4. The sampled metres include backlog sampling.
Cooke Underground Operation’s Surface Exploration Holes Indicating the VCR Mined Area and Proposed
Boreholes
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
3.2.6. Cooke Underground: Doornkop Plant
During the quarter under review reef from the Cooke Underground Operation was treated at the Doornkop
Plant as well as at the Cooke Gold Plant. 30,599 tonnes from Cooke 1 Shaft was treated at the Cooke Gold
Plant at a recovered grade of 2.92 grams per tonne.
Gold One has an ore treatment agreement with Harmony for the treatment of material from all three Cooke
shafts at the Doornkop Plant. The agreement was due to expire in June 2012, however, it has been renewed
for a further 24 months with a cancellation clause option of three months.
During the June 2012 quarter some 239,346 tonnes were milled and treated at the Doornkop Plant at an
average recovered declared grade of 2.98 grams per tonne. Of the total tonnes milled, Cooke 1 milled
41,536 tonnes at a recovered grade of 2.64 grams per tonne, Cooke 2 milled 88,821 tonnes at a recovered
grade of 3.14 grams per tonne, and Cooke 3 milled 108,989 tonnes at a recovered grade of 2.99 grams per
tonne. Doornkop Plant accountability for the quarter was 103.1%, which represents an improvement of 8%
on the previous quarter.
In addition, production from the three shafts was supplemented by some 27,678 tonnes of low grade
development ore and underground sludge at a recovered grade of 0.26 grams per tonne.
Additional improvements to plant accountability are expected during the September 2012 quarter as the
plant continues to operate at a steady state. Harmony has also embarked on a capital project to refurbish
the Doornkop Plant in order to improve plant efficiencies and throughput. The project will be completed in
three phases, of which phase 1 is scheduled for completion by the end of July 2012. The main focus of phase
1 is to improve feed throughput and leach retention times as well as carbon management. To date the
availability of the plant equipment has improved and the residue value has improved from 0.194 grams per
tonne in the March 2012 quarter to 0.151 grams per tonne in the June 2012 quarter, reflecting an overall
improvement of 22%.
The plant’s operating cost has decreased to ZAR 81.99/t milled, realising an improvement of 0.9% when
compared to the previous quarter. Phases 2 and 3 of the plant refurbishment will focus on maintaining the
plant at sustainable throughput and efficiency levels and should be completed towards the end of the year.
3.3. Randfontein Surface Operation
Randfontein Surface June 2012 Quarter March 2012 Quarter
Reclaimed Grade 0.569 g/t 0.434 g/t
Milled Tonnes 786 346 t 756 390 t
Recovered Grade 0.41 g/t 0.301 g/t
Residue Grade 0.159 g/t 0.133 g/t
Gold Recovery 72 % 69.3 %
Gold Produced 10 370 oz 7 326 oz
Cash Cost US$ 1 000/oz US$ 1 388/oz
3.3.1. Randfontein Surface: Operational Review
At the end of the June 2012 quarter the Randfontein Surface Operation’s progressive LTIFR for the 2012 year
was recorded at 1.09, reflecting an improvement on the operation’s 2012 LTIFR as at the end of March 2012
quarter of 1.83. The LTIFR for the quarter alone was 0.42.
During the quarter under review the Cooke Gold Plant produced 13,471 ounces of which 10,370 ounces
were attributable to the reclamation of Dump 20, 2,869 ounces were attributable to Cooke 1 ore, and the
balance of 229 ounces was attributable to the low grade waste rock and mud. Production at the operation
improved significantly during the quarter with a total of 786,347 tonnes treated from surface sources. This
reflects an increase of 50,550 tonnes when compared to the March 2012 quarter. The average head grade
for the quarter was 0.569 grams per tonne reflecting a 0.135 grams per tonne improvement on the March
2012 quarter. The combination of higher tonnages and particularly of the higher head grade resulted in a
reduction in cash operating costs for the quarter to US$ 1,000 /oz.
Gold production for the treatment of the surface material from Dump 20 was 42% or 3,044 ounces higher
than the March 2012 quarter largely due to four key factors:
- Improved mining volumes delivered to the plant
- Improved grade associated with the higher grade Dump 20 floor
- High grade material associated with the Cooke Gold Plant clean up
- Introduction of a commercially available high intensity oxygen injection reactor, which improved the
plant recovery factor from 69.3% in the previous quarter to 72% in the quarter under review.
During the September 2012 quarter, the operation will continue to reclaim approximately 20% of the Dump
20 sand from the higher grade floor together with hydraulically reclaimed fines from Cooke 2 Shaft. In the
absence of the high grade material from the Cooke Gold Plant clean up that was realised during the quarter
under review, a decrease in the average head grade to approximately 0.43 grams per tonnes is expected
during the September 2012 quarter.
3.3.2. Randfontein Surface: Turnaround and Growth Strategy
The Randfontein Surface Operation is continuing to pursue various initiatives to improve efficiencies and
reduce operating costs. Such initiatives include the optimisation of the current operations and the
identification of additional feed sources with higher feed grades. Specific aims of the turnaround strategy
include reducing the reliance on mechanically reclaimed Dump 20 sand, increasing operational flexibility,
reducing operating costs, and improving the average head grade to the Cooke Gold Plant.
3.3.2.1. Randfontein Surface: Cooke Gold Plant Optimisation Project
The Cooke Gold Plant Optimisation Project was initiated at the beginning of 2012 with the objectives of
extending the Cooke Gold Plant’s operating life, expanding the current operation to achieve improved
economy of scale, reducing plant operating costs and securing an alternative deposition site to the Cooke
Dump that will be reclaimed for the Cooke Uranium Project. The principal opportunity that has been
identified is that of changing the surface reclamation from a sand-only mechanically reclaimed source to a
combination of hydraulically reclaimed slimes and mechanically reclaimed sand, thereby reducing
reclamation costs and plant milling costs. The tailings residue will be deposited into the old open pits, which
will provide deposition capacity until approximately 2018.
During the June 2012 quarter significant progress was made with the project’s engineering design and
costing. Specialist environmental studies pursuant to the pit deposition amendment application to the
authorities were also completed for the increased tonnage to be deposited to the various open pits owned
by the company.
The current proposal is to complete the project’s definitive feasibility study by the end of 2012. Cooke Gold
Plant residues will continue to be deposited to the Cooke Dump in the interim.
3.3.3. Randfontein Surface: Resources and Reserves
During the March and June 2012 quarters an extensive drilling programme was completed on the new slime
and sand resources for Dump 20. This drilling programme included a total of 770.5 metres and 37
boreholes. During the quarter under review extensive metallurgical test work was completed on composite
samples of sand and slimes material from Dump 20. The generation of the new sand and slime mineral
resource and mineral (ore) reserve for the Dump 20 deposit is expected during the September 2012 quarter.
An exploratory drilling and metallurgical test work programme is also currently progressing on the Millsite
Tailings Complex. The current resource estimate for the Millsite Complex is based on 54 boreholes. The
exploration programme will specifically target the extent of the high grade and low grade areas on the
complex and a refined resource model will be created for this surface deposit. During the June 2012 quarter
a total of 38 and 20 exploration boreholes were drilled on the respective Dump 38 and Dump 39 portions of
the Millsite Complex. The depositional history of the Millsite Complex has been investigated and updated
survey models are being developed for the various resource domains that have now been identified. The
generation of the new Millsite Complex resource model is expected during the December 2012 quarter.
Limited drilling of the Dump 4 resource is planned for the September 2012 quarter to obtain a
representative sample for metallurgical test work.
Both the Millsite and the Dump 4 complexes will contribute towards Gold One’s growth strategy to build a
sustainable surface retreatment business.
4. Development and Exploration Projects
4.1. Modder North
During the June 2012 quarter four exploration boreholes were completed, namely: MN12, MN26, MN28 and
MN32. In addition, percussion drilling was used to pre-collar a further eight planned boreholes to a depth of
120 metres (MN31, MN32, MN37, MN39, MN40, MN42, MN43, MN47). Diamond drilling of MN27, MN31,
MN42 and MN46 has commenced and will continue during the September 2012 quarter. A total of 3,518
metres was drilled during the quarter under review at a total cost of US$ 0.72 million, including 960 metres
of percussion drilling and 2,558 metres of diamond drilling.
The primary target at Modder North is the Main Reef. Utilising information from historical boreholes, recent
and historical underground sampling and the current exploration programme potential higher grade
channelised areas (payshoots) have been defined (refer to green areas illustrated on the figure below). This
information has also facilitated the definition of a preliminary structural geological model that will inform
future borehole positioning and mine layouts. On the basis of this information and modelling, an initial
target area has been defined (indicated by the black dashed line below) that is considered sufficient to
potentially support a pre-feasibility study pending the outcome of the exploration drilling results.
In addition to the Main Reef the Black Reef, which forms the primary orebody at Modder East, overlies the
Main Reef at depths of approximately 290 metres below surface. Well mineralised Black Reef was
intersected in borehole MN3. Regionally Black Reef intersections in Main Reef boreholes have not
supported the high grades found in MN3 and therefore Gold One will drill four additional shallow holes
targeting the area close to MN3 in order to determine the extent of the potential Black Reef deposit. On the
basis of this information the Black Reef appears to be more channelised than that currently mined at
Modder East. However, the Black Reef remains highly prospective in terms of the possibility of localised
deposits. The boreholes planned as part of the current Main Reef drill programme will also intersect Black
Reef, thereby facilitating the definition of a broader regional Black Reef geological model.
Modder North Exploration Drilling Progress and Planning Schematic
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
Based on the modelling undertaken to date a future three phased drilling programme is envisaged. Phase 1
has already commenced and is designed to confirm the extension of the modelled Main Reef payshoot
areas. Phase 1 considers four boreholes, namely MN37, MN 39, MN42 and MN43, and is aimed at
confirming the modeled payshoot positions. MN42 has already intersected very well developed Main Reef
although deflection drilling is still in progress and sampling is currently being completed. Phase 2 considers
an infill drilling programme to facilitate the estimation of a mineral resource. The provisional planned
boreholes are indicated in yellow above and represent a total of 14 infill holes. It is envisaged that drilling
during the September 2012 quarter will comprise the completion of the phase 1 drilling programme and the
commencement of the phase 2 infill drilling, which will be completed during the December 2012 quarter. On
completion of the phase 2 drilling programme a mineral resource for the area will be estimated and will
underpin a pre-feasibility study.
The remaining possible strike and down dip resource potential is considerable and phase 3 of drilling will
consider the expansion of the initial resource. This will only commence during the March 2013 quarter.
Modder North 2012 Drilling Programme Assay Results
Dip Corrected
Depth (m) Channel
Bottom Thickness
BH_ID REEF Contact (cm) 1 g/t 2 cm.g/t
MN10 Main Reef 377.32 6 12.6 71
MN10 1D Main Reef 377.5 18 7.74 136
MN10 2D Main Reef 378.05 15 10.13 148
MN12 Main Reef 447.37 40 18.07 722
MN12 1D Main Reef 447.55 30 14.49 428
MN12 2D Main Reef 446.69 32 39.74 1252
MN26 Main Reef 456.94 16 2.57 40
MN26 1D Main Reef 456.82 13 4.91 63
MN26 2D Main Reef 457 11 4.79 51
MN28 Main Reef 444.73 78 10.6 797
MN28_1D Main Reef 444.94 73 9.04 664
MN28_2D Main Reef 444.88 71 9.47 677
MN32 Main Reef 484.23 34 9.49 327
MN32_1D Main Reef 484.48 46 7.31 338
MN32_2D Main Reef 484.52 40 8.43 337
MN29 Main Reef Abandoned-large Dyke
MN17 Main Reef Abandoned-large Dyke
Notes:
1
Channel thickness represents the true, dip corrected thickness of the Reef. Dip corrections are
undertaken based on dip measurements from core bedding angles.
2
Represents the average grade over the true thickness of the total reef, calculated using a weighted
average of assayed grade from individual samples over the total channel thickness (individual sample
lengths are typically between 15 centimetres and 30 centimetres).
4.2. Ventersburg
The project feasibility phase at Ventersburg progressed well during the quarter under review with the
completion of nine boreholes, including one borehole drilled for geotechnical evaluation purposes. Drilling
during the June 2012 quarter amounted to 6,758 metres at a drilling cost of US$ 1.03 million. A light
detection and ranging (LIDAR) survey was successfully carried out during the quarter under review and
specialist studies, including geohydrological and environmental impact work, have commenced. The total
project expenditure for the quarter including the abovementioned exploration drilling costs amounted to
US$ 1.43 million.
The main feasibility study, which is being executed by Turgis Consulting (Pty) Limited, is primarily aimed at
validating and refining the mine design criteria considered during the pre-feasibility study. In addition
mining fleet selection criteria have been completed and preliminary underground station and surface
infrastructure layouts have been drafted and are currently under review.
The results for boreholes AFO057 and AFO065 were still pending from the reported March 2012 quarter
drilling results. These boreholes were drilled to refine the edge of the eastern payshoot extension and were
not part of the infill drilling being carried out within the first five years of planned mining areas (refer to the
diagram below for borehole localities circled in red).
Borehole Results from Drilling to Refine Eastern Edge of the Payshoot
Depth True Gold Uranium
Intersection Reef in Width Grade Value Grade Value
Metres (cm)¹ (g/t)² (cmg/t)³ (kg/t) (cmkg/t)
AFO057 A Reef 925.06 50 2.59 129 0.322 16.098
AFO057_D2 A Reef 925.66 65 1.82 119 0.180 11.778
AFO057_D3 A Reef 926.23 66 3.62 239 0.261 17.197
60 2.69 162 0.249 15.024
AFO065_1D A Reef 843.66 87 2.49 217 0.142 12.351
AFO065_2D A Reef 843.80 84 2.49 210 0.133 11.165
AFO065_4D A Reef 843.81 89 2.93 261 0.129 11.470
AFO065_5D A Reef 843.42 79 3.17 252 0.143 11.324
84 2.86 241 0.135 11.320
Notes:
¹ Channel thicknesses represent the true, dip corrected thickness of the reef rounded off to the nearest centimetre. Dip corrections
are undertaken based on dip measurements from core bedding angles.
² Represents the average grade over the true thickness of the total reef. Calculated using a weighted average of assayed grade
from individual samples over the total channel thickness (individual sample lengths are typically between 15 centimetres and 30
centimetres).
³ Centimetre grams per tonne (gold accumulation) is calculated using the true dip corrected thickness of samples multiplied by the
grade of individual samples.
Map showing the Ventersburg resource area and 2012 drilling focus. The demarcated area in red indicates the holes that were drilled to refine the eastern boundary of the payshoot.
The blue dotted line indicates the area proposed for the first five years of stoping.
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
The assay results received to date for the infill drilling campaign are outlined in the table below. Four drill
rigs are currently in operation to complete the infill campaign and the geotechnical requirements for the
specialist studies. The remaining infill holes to be drilled are circled in red in the Diagram below. Once the
remaining infill drilling is complete, the additional information will be used to update the current geological
and mineral resource models that will underpin the feasibility study. Boreholes AFO055 and AFO047 are not
in the initial proposed area for the first five years of mining primarily due to this area comprising lower
grade. Due to the proximity to the proposed vertical shaft, however, this area is being targeted to increase
geological confidence facilitating a decision as to whether this area should be included in the five year
mining area.
Summary of Latest Results Received During 2012 Infill Drilling Campaign
Depth True Gold Uranium
Intersectio
Reef in Width Grade Value Grade Value
n
Metres (cm)¹ (g/t)² (cmg/t)³ (kg/t) (cmkg/t)
AFO046 A Reef 779.49 189 2.11 399 0.075 14.267
AFO046_1D A Reef 779.33 173 1.72 298 0.067 11.556
AFO046_2D A Reef 779.78 203 1.82 371 0.073 14.766
189 1.89 356 0.072 13.530
AFO064 A Reef 621.57 128 3.39 432 0.369 47.053
AFO064_1D A Reef 621.36 123 3.02 370 0.345 42.323
AFO064_2D A Reef 621.40 130 3.08 402 0.390 50.832
127 3.16 401 0.368 46.736
AFO069_1D A Reef 610.94 181 3.87 698 0.311 56.175
181 3.87 698 0.311 56.175
AFO074 A Reef 689.52 86 5.31 454 0.338 28.895
AFO074_1D A Reef 689.71 89 6.18 548 0.313 27.759
AFO074_2D A Reef 689.14 79 5.64 448 0.260 20.667
AFO074_3D A Reef 689.21 87 5.88 513 0.286 24.918
85 5.76 490 0.300 25.560
AFO081 A Reef 579.23 165 4.73 783 0.200 33.088
AFO081_1D A Reef 578.87 156 4.49 702 0.220 34.480
AFO081_2D A Reef 578.87 160 5.84 935 0.310 49.619
161 5.02 807 0.243 39.062
AFO070 Reef faulted
AFO075 Reef faulted
AFO077 Reef faulted
AFO076 A Reef
AFO079 A Reef
Results Pending
AFO080 A Reef
AFO084 A Reef
Notes:
¹ Channel thicknesses represent the true, dip corrected thickness of the reef rounded off to the nearest centimetre. Dip corrections
are undertaken based on dip measurements from core bedding angles.
² Represents the average grade over the true thickness of the total reef. Calculated using a weighted average of assayed grade
from individual samples over the total channel thickness (individual sample lengths are typically between 15 centimetres and 30
centimetres).
³ Centimetre grams per tonne (gold accumulation) is calculated using the true dip corrected thickness of samples multiplied by the
grade of individual samples.
Diagram: Ventersburg Remaining Infill Drilling Holes
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
Note: The remaining infill drilling holes are indicated within the red circles.
4.3. Tulo
The 20 kilometre drill rig access road into the concession area, which was severely damaged by tropical rain
storms during the March 2012 quarter, was repaired during the June 2012 quarter and is currently fully
functional.
Fugro Airborne Surveys (Pty) Limited completed a high resolution helicopter-borne geophysical survey of
Tulo and the surrounding areas during the December 2011 quarter. The survey included magnetic,
radiometric and digital elevation model surveys. A total of 6,365 line kilometres was flown. Prominent
magnetic lineaments identified by the survey have been compared to mapped quartz veins and positions of
historical exploration drillholes. A positive correlation over 3.5 kilometres has been confirmed. On the basis
of the geophysical surveys the potential target area for exploration is larger than originally anticipated. This
resulted in a decision to delay the planned drilling until the full 17 kilometre magnetic lineament that
stretches over the Tulo concession has been investigated and mapped to identify priority drilling targets. An
initial evaluation of possible drill targets will be confirmed through trenching where feasible.
GAP Geophysics (Pty) Limited is currently preparing a litho-structural interpretation of the Tulo
aeromagnetic and radiometric data. The geological mapping, sampling and magnetic evaluation is planned
to be completed by year-end.
Discovery Drilling Contractors Africa (Pty) Limited assessed the exploration terrain and logistical parameters
during April 2012 to determine the type of equipment required for the drilling programme planned for 2013.
It is planned that drilling equipment will be transported to Monkey Bay in Malawi by the end of March 2013
and the service of a 700 tonne barge belonging to Malawi Lakeside Services has been secured to transport
all the drilling equipment across the Malawi Lake to Tulo. Diamond drilling is planned to commence during
April 2013.
Expenditure at Tulo for the June 2012 quarter amounted to US$ 0.85 million.
4.4. Cooke Uranium Project
The Cooke Uranium Project has undergone extensive analysis and design since 2008, prior to the acquisition
of Rand Uranium by Gold One. In 2008 Rand Uranium appointed Bateman Engineering Limited (“Bateman”)
to conduct a pre-feasibility study on the project’s viability. Bateman advanced the study beyond definitive
feasibility level following the completion c.60% of the front end engineering and design, which included
advanced design engineering and hazard and operability studies. During the three years over US$ 20 million
was spent on the advancement of the project. The Cooke Uranium Project is underpinned by the Cooke
Tailings Dam that has a published mineral resource statement of 34.3 million pounds of uranium grading at
181 grams per tonne (including 79.3 million tonnes grading at 186 grams per tonne in the Measured
resource category and 7.0 million tonnes grading at 119 grams per tonne in the Indicated resource
category), compliant with both the Australian and the South African codes for reporting of exploration
results, mineral resources and mineral (ore) reserves (JORC and SAMREC codes).
After the acquisition of Rand Uranium, Gold One initiated a revalidation of the study. Consulting companies
Bateman and MDM Engineering Group Limited (“MDM”) were appointed to revalidate the study and review
all assumptions and conclusions, leveraging the three years of study material available. Key objectives
included the optimisation of the flow sheet by reviewing other appropriate technologies including resin-in-
pulp, the optimisation of uranium and gold recoveries, and the optimisation of capital expenditure. The
revalidation exercise was completed during April 2012.
The outcome of the revalidation exercise was positive with a resultant decrease in the capital costs of the
metallurgical complex. Innovative ideas including footprint optimisation substantially reducing the
earthworks, the inclusion of resin-in-pulp instead of counter current decantation, and better use of gravity in
the plant layout, all contributed to a decrease in the plant capital.
In Rand Uranium’s original design the company identified the Millsite Tailings Dam and pits as having
sufficient capacity to accept the tailings from the Cooke Uranium Project. These deposition sites were fully
permitted by Rand Uranium for the purposes of the uranium project. Although this deposition strategy
remains an economically viable option for Gold One, the company has identified the Millsite Complex that
contains uranium and gold deposits as a potential resource for the Randfontein Surface Operation and, as
such, an alternative deposition site, namely the Geluksdal site, is currently being permitted for deposition.
Digby Wells Environmental (Pty) Limited has been mandated to execute the necessary permitting of the
deposition site. In parallel with the permitting, Golder Associates (Pty) Limited has been mandated to ensure
that the pumping systems and deposition site engineering and design are advanced to feasibility level status
by the end of the year.
A further outcome of the revalidation exercise was the appointment of Bateman to advance the new ideas
and thinking to the same level of feasibility as the rest of the project. The additional project work is
expected to resume during August 2012 and is expected to be completed during December 2012.
The simple and proven technology associated with the construction and operation of the Cooke Uranium
Project is expected to facilitate an on-time start with a short ramp up period, with the potential to
commence with production by 2015.
4.5. Gold Fields Joint Venture
Gold One and Gold Fields have signed a memorandum of understanding to jointly investigate the feasibility
of establishing a joint venture into which both parties will contribute surface assets for retreatment. The
joint assets comprise in excess of 800 million tonnes and will represent over 60% of the total tailings
material in the West Rand and far West Rand region. The intention is to reclaim and retreat the historical
and current tailings material to recover residual gold, uranium and sulphur. A further objective of the
project will be to address the redeposition of the residues in accordance with modern sustainable deposition
practices, ultimately supporting mine closure in an environmentally sustainable manner. In 2010 Gold Fields
completed a feasibility study considering the reprocessing their tailings material, while Gold One has
recently completed a full evaluation of the feasibility study completed on the Cooke Uranium Project.
Gold One and Gold Fields jointly commissioned MDM to undertake a scoping level study to investigate the
synergetic potential of integrating the two companies’ feasibility studies considering the reprocessing of
their combined surface tailings deposits on the West Rand. MDM was commissioned due to its experience
with the development of First Uranium’s surface retreatment business, Mine Waste Solutions (Pty) Limited,
and its understanding of both the Gold Fields Tailings Treatment Project (“TTP”) and Gold One’s Cooke
Uranium Project. A project steering committee consisting of members from both Gold Fields and Gold One
was formed to review processes and was initiated on 13 February 2012.
The scoping study undertook to investigate a number of possible processing options to optimise a joint flow
sheet and the scheduling of available resources together with both existing and new infrastructure. The
study is to be supported by sufficient design and cost detail to prove that the value proposition of the
integrated flow sheet is greater than the individual value propositions of the original Gold Fields TTP and the
Cooke Uranium Project. During the quarter under review, MDM completed a conceptual joint flow sheet
which is currently being reviewed by the project steering committee established to represent both parties.
The completion of the phase 1 scoping study is anticipated during the September 2012 quarter.
A successful outcome of an enhanced value proposition may lead to a decision by Gold One and Gold Fields
to progress the study to a prefeasibility/feasibility study investigation.
5. Corporate Development
5.1. Ezulwini
During the quarter under review the company progressed with the fulfilment of the conditions precedent for
the acquisition of 100% of the issued shares of and all shareholders’ claims against First Uranium, which
holds 100% of the issued shares of and all shareholders’ claims against Ezulwini for a total consideration of
US$ 70 million, which equated to ZAR 539.7 million on the date that the agreement was tabled.
Gold One first entered into a binding letter agreement with First Uranium on 2 March 2012, after which a
binding sale of shares and claims agreement was signed on 2 April 2012.
The US$ 70 million payable by Gold One upon the completion of the acquisition will be provided through the
Investec financing arrangement, which the company secured during the March 2012 quarter and formally
announced on 3 April 2012.
Ezulwini is located in close proximity to the company’s Cooke Underground Operation and Randfontein
Surface Operation and includes a commissioned uranium plant. This will allow for near term production of
uranium from underground ore mined at Cooke. In addition, Ezulwini offers an alternative gold plant for the
processing of Cooke underground ore. While the sharing of services between Ezulwini and the Cooke
Underground Operation will facilitate a reduction in operating costs, Gold One will also benefit from the
addition of Ezulwini’s gold and uranium resources as well as the asset’s further exploration potential.
As such, an integrated plan has been developed which will see Eulwini being incorporated into the greater
Cooke Underground Operation in order to yield the benefits described above.
Further details regarding the material terms and conditions and the transaction rationale for the transaction
can be found in the Gold One media released titled ‘Gold One to Acquire 100% of Ezulwini Mine from First
Uranium’, published on 2 March 2012, and the release titled ‘Gold One Signs Definitive Agreement for
Acquisition of Ezulwini Mine, published on 2 April 2012. These announcements are available on the ASX
Limited (“ASX”) Market Announcements Platform (“MAP”), the JSE Limited (“JSE”) Securities Exchange News
Service (“SENS”) and the Gold One website.
5.2. Pamodzi East Rand Operations Acquisition
On 17 April 2012 Gold One announced that, together with its wholly owned subsidiary NKMC and Goliath
Gold Mining, the company had entered into an acquisition agreement with the joint provisional liquidators
representing Pamodzi Gold East Rand (Pty) Limited (“Pamodzi”) and its subsidiaries.
In terms of the agreement, selected surface assets of Grootvlei (Pty) Mines Limited (“Grootvlei”) will be
acquired by NKMC, while historical mining and technical data from Consolidated Modderfontein Mines 1979
Limited, Consolidated Modderfontein Mines Limited, Nigel Gold Mining Company (Pty) Limited and Grootvlei
will be acquired by Goliath Gold. The aforementioned assets and mining data are collectively referred to as
the Pamodzi East Rand Operations, for which the total purchase consideration is ZAR 70 million. Post the
announcement of the acquisition, the company commenced with the fulfillment of the conditions
precedent, which is progressing according to plan. The anticipated completion of all conditions precedent is
30 September 2012, which can be extended by mutual agreement by both parties.
Further details regarding the conditions precedent and the transaction rationale for the acquisition can be
found in the joint Gold One and Goliath Gold media released titled ‘Gold One and Goliath Gold to Acquire
the Pamodzi East Rand Underground Deposits and Selected Assets for ZAR 70 Million’, published on 17 April
2012. The announcement is available on the ASX MAP, the JSE SENS and on Gold One and Goliath Gold’s
respective websites.
5.3. Hong Kong Listing
In the December 2011 Quarterly Report Gold One announced that it had begun establishing an office in
Hong Kong and that it intended to initiate a listing on the Hong Kong Stock Exchange (“HKSE”). In light of the
current shareholding structure and restricted liquidity position of Gold One, as well as market conditions,
the company anticipates a listing on the HKSE during the June 2013 quarter, market conditions permitting
and subject to the timing of any other material corporate activity.
To date the company has commenced with internal assessments and has engaged in dialogues with
regulators, including the Hong Kong Exchange, banks and advisors. Any such listing would be closely
coordinated with the corporate development strategy of the company.
The Hong Kong exchange provides strong liquidity and valuation metrics compared to the ASX and JSE. With
Gold One’s solid fundamentals, the strong operating and governance principles of the company, and the
brand equity associated with Gold One’s major shareholders, a listing on the HKSE under the right market
conditions will better reflect the true value of the company as well as provide access to a new cluster of
institutional and retail investors. The use of stronger Gold One equity for future acquisitions and operational
expansion will be value accretive to every Gold One shareholder.
6. Outlook
6.1. Group Production Guidance
Total group gold production for the September 2012 quarter is forecast at 55,000 ounces.
The production outlook for the Modder East Operation’s September 2012 quarter is 16, 000 ounces.
During the September 2012 quarter the company will continue to normalise production at Modder East.
The company has introduced a number of contingencies to alleviate the impact of the strike, and these have
proved very successful to date. The dismissal of striking employees will have an adverse impact on the
September 2012 quarter’s production as recruitment of new human resources is a timeous process. In the
interest of the health and safety of all employees, all new recruits, whether former employees or novices,
will have to undergo stringent induction training before they are deployed underground. The company
envisages that recruitment and engagement will continue through most of the September 2012 quarter with
daily production volumes returning to pre-strike levels by the end of the quarter, enabling further build up in
production to commence in the December 2012 quarter.
The production outlook for the Cooke Underground Operation’s September 2012 quarter is 30,000 ounces,
reflecting a 15% increase on the June 2012 quarter. The turnaround initiatives are expected to further
contribute to this improvement in production for the upcoming quarter with specific focus placed on the
improvement of the mine call factor and quality mining practices.
For the Randfontein Surface Operation, the production outlook for the September 2012 quarter is expected
to normalise at 9,000 ounces.
It is envisaged that the group will achieve a 70,000 ounce output for the December 2012 quarter, giving a
group revised outlook of 250,000 ounces for the total 2012 year. In addition, Ezulwini will be incorporated
into the Cooke Underground Operation during the last five months of 2012 and it is expected to contribute
an additional 15,000 ounces during this period providing a total group gold production of 265,000 ounces, as
opposed to production forecasts of 300,000 ounces prior to the illegal industrial action and the inclusion of
Ezulwini.
6.2. Group Development Outlook
The Gold One and Gold Fields jointly commissioned scoping study, investigating the synergetic potential of
integrating the two companies’ feasibility studies considering the reprocessing of their combined surface
tailings deposits on the West Rand, is to be completed during the September 2012 quarter. A successful
outcome of an enhanced value proposition may lead to a decision by Gold One and Gold Fields to progress
the study to a prefeasibility/feasibility study investigation during the same quarter.
During July 2012 the company will continue to work closely with First Uranium to timeously complete the
outstanding condition precedent relating to the Ezulwini transaction. The companies are currently targeting
fulfilling the outstanding conditions by the end of the July 2012 with the implementation of the acquisition
expected on 1 August 2012. The Cooke Underground Operation’s co-product strategy of opening up high
grade uranium areas will also be fast tracked following the final closure of the Ezulwini acquisition. An
integration plan has been developed, which will see Ezulwini being integrated into the Cooke Underground
Operation from early August 2012 as Cooke 4 Shaft. The US$ 70 million payable by Gold One upon the
completion of the acquisition will be provided through the Investec financing arrangement, which the
company formally announced in August 2011.
During the September 2012 quarter the company will continue to progress the outstanding conditions
precedent to the acquisition agreement with the joint provisional liquidators representing Pamodzi and its
subsidiaries. The anticipated completion of all conditions precedent is 30 September 2012, which can be
extended by mutual agreement by both parties.
7. Capital Structure
As of the release of this report, the company has 1,416,527,115 shares on issue, of which 1,365,216,081
(96.4%) are held on the Australian register and 51,311,034 (3.6%) are held on the South African register. The
company has 39,674,237 listed and unlisted options in issue.
ASX Trading Statistics since March 2012
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
JSE Trading Statistics since March 2012
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
ENDS
Johannesburg
30 July 2012
JSE SPONSOR
Macquarie First South Capital (Pty) Limited
Issued by Gold One International Limited
www.gold1.co.za
Neal Froneman President and CEO +27 11 726 1047 (office) +27 83 628 0226 (mobile) neal.froneman@gold1.co.za
Grant Stuart VP: Investor Relations +27 11 726 1047 (office) +27 82 602 5992 (mobile) grant.stuart@gold1.co.za
Carol Smith Investor Relations +27 11 726 1047 (office) +27 82 338 2228 (mobile) carol.smith@gold1.co.za
Derek Besier Farrington National Sydney +61 2 9332 4448 (office) +61 421 768 224 (mobile) derek.besier@farrington.com.au
About Gold One
Gold One International Limited is a dual listed (ASX/JSE: GDO) mid-tier mining group with gold operations and gold and uranium
prospects across Southern Africa. Gold One remains focused on developing and mining low technical risk, high margin precious
metal resources in diversified jurisdictions. The company’s flagship Modder East gold mine, commissioned in 2009, distinguishes
itself from most other gold mines in South Africa owing to its shallow nature (300 to 500 metres below surface) and continues to
ramp up production, having produced 123,179 ounces in 2011.
At the beginning of 2012, the group expanded further with the acquisition of Rand Uranium (Pty) Limited consisting of the Cooke
Underground Operations and the Randfontein Surface Operations located in the West Rand, 30 kilometres from Johannesburg. The
Cooke underground operations continue to deliver in line with expectations and are currently the subject of a turnaround
intervention. Through Gold One’s purchase of Rand Uranium (Pty) Limited, the group has also acquired one of the world’s most
advanced uranium projects, which envisages recovering uranium, gold and sulphur from the Cooke Tailings Dam and underground
ores. The Gold One group is majority-owned by a consortium comprising Baiyin Non-Ferrous Group Co. Limited, the China-Africa
Development Fund, and Long March Capital Limited, and has an issued share capital of 1,416,527,115 shares.
Office Details Johannesburg Corporate Office
Constantia Office Park, Bridgeview House, Ground Floor
Sydney Head Office Corner 14th Avenue and Hendrik Potgieter Street
Level 3, 100 Mount Street, Weltevreden Park, 1709, Gauteng, South Africa
North Sydney, NSW 2060 Telephone: +27 11 726 1047
Australia Fax: +27 11 726 1087
PO Box 1244 North Sydney NSW 2059
Telephone: +61 2 9963 6400 Issued Capital
Fax: +61 2 9963 6499 1,416,315,461 shares on issue
Options (listed and unlisted: 39,674,237)
ADR ratio: 1 ADR = 10 ordinary shares Sydney
NSW
Stock Exchange Listings Australia
ASX/JSE Limited: GDO 2000
OTCQX International: GLDZY Tel: +61 2 9290 9600
Directors South African Transfer Secretaries
- N Froneman (CEO) Computershare Investor Services
- C Chadwick (CFO) 70 Marshall Street
- Y Sun (Chairman) Johannesburg
- M Wheatley (Lead Independent Non-Executive Director) 2001
- K Winters (Independent Non-Executive Director)
- B Davison (Independent Non-Executive Director) Level 1 ADR Sponsor
- M Solomon (Independent Non-Executive Director) The Bank of New York Mellon
- H Liu (Independent Non-Executive Director) Depositary Receipts Division
- T L Chan (Independent Non-Executive Director) 101 Barclay St, 22nd Floor
New York, New York 10286
- M Liao (Non-Executive Director)
USA
- C Zhou (Non-Executive Director)
Tel: +1 212 815 3700
Fax: +1 212 571 3050
Company Secretaries
Auditors
- B Snell (Australia)
PricewaterhouseCoopers Incorporated
- P B Kruger (South Africa)
201 Sussex Street
Sydney, NSW 1171
Registrars
Australia
Boardroom Limited
Telephone: +61 2 8266 0000
Level 7
207 Kent Street
This news release does not constitute investment advice. Neither this news release nor the information contained in it constitutes an
offer, invitation, solicitation or recommendation in relation to the purchase or sale of securities in any jurisdiction.
Forward-Looking Statement
This release includes certain forward-looking statements and forward-looking information. All statements other than statements of
historical fact included in this release including, without limitation, statements regarding future plans and objectives of Gold One
International Limited are forward-looking statements (or forward-looking information) that involve various risks, assumptions and
uncertainties. There can be no assurance that such statements will prove to be accurate and actual values, results and future events
could differ materially from those anticipated in such statements. Important factors could cause actual results to differ materially
from Gold One’s expectations. Such factors include, among others: the actual results of exploration activities; actual results of
reclamation activities; the estimation or realisation of mineral reserves and resources; the timing and amount of estimated future
production; costs of production; capital expenditures; costs and timing of the development of Modder East and new deposits;
availability of capital required to place Gold One’s properties into production; the ability to obtain or maintain a listing in South
Africa, Australia, Europe or North America; conclusions of economic evaluations; changes in project parameters as plans continue to
be refined; future prices of gold and other commodities; possible variations in ore grade or recovery rates; failure of plant,
equipment or processes to operate as anticipated; accidents; labour disputes and other risks of the mining industry; delays in
obtaining governmental approvals, permits or financing or in the completion of development or construction activities, economic
and financial market conditions; political risks; Gold One’s hedging practices; currency fluctuations; title disputes or claims
limitations on insurance coverage. Although Gold One has attempted to identify important factors that could cause actual results to
differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended.
Any forward-looking statements in this release speak only at the time of issue. There can be no assurance that such statements will
prove to be accurate as actual values, results and future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking statements. Gold One does not undertake to update any
forward-looking statements that are included herein, or revise any changes in events, conditions or circumstances on which any such
statement is based, except in accordance with applicable securities laws and stock exchange listing requirements.
Competent Persons’ Statement
The information in this release that relates to exploration results, mineral resources or ore reserves is based on information
compiled by the following Competent Persons for the purposes of both the 2004 Edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves (“JORC Code”) and the 2007 Edition of the South African Code for
Reporting of Exploration Results, Mineral Resources and Mineral Reserves (“SAMREC Code”):
34 | P a g e
The overall Competent Person for the Gold One group is Dr Richard Stewart , who has a doctorate in geology and who is a
professional natural scientist registered with the South African Council for Natural Scientific Professions (“SACNASP”), membership
number 400051/04. Dr Stewart is also a member of the Geological Society of South Africa (“GSSA”) and is Senior Vice President:
Business Development for Gold One, with which he is a full-time employee, and has 12 years’ experience relevant to the style of
mineralisation and type of deposit under consideration, and to the activity which he is undertaking, to qualify as a Competent Person
for the purposes of both the JORC Code and the SAMREC Code.
The Competent Person for the Ventersburg Project is Mr Quartus Meyer, who has a master’s degree in science (geology) and who is
a professional natural scientist registered with SACNASP, membership number 400063/88. Mr Meyer is Group Exploration Manager
for Gold One, with which he is a full-time employee, and has 25 years’ experience relevant to the style of mineralisation and type of
deposit under consideration, and to the activity which he is undertaking, to qualify as a Competent Person for the purposes of both
the JORC Code and the SAMREC Code.
The Competent Person for the Modder East Operations is Mr Evan Cook, who has a bachelor’s degree in technology (geology) and
who is a professional natural scientist registered with SACNASP, membership number 400162/07. Mr Cook is the Mineral Resources
Manager: Modder East Operations for Gold One, with which he is a full-time employee, and has 13 years’ experience relevant to the
style of mineralisation and type of deposit under consideration, and to the activity which he is undertaking, to qualify as a
Competent Person for the purposes of both the JORC Code and the SAMREC Code.
The Competent Person for the Cooke Operations is Mr Dave Whittaker, who has an honour’s degree in science (geology geography)
and who is a professional natural scientist registered with SACNASP, membership number 400053/00. Mr Whittaker is Mineral
Resources Manager: Cooke Underground Operations for Rand Uranium (Pty) Limited, with which he is a full-time employee and
which is wholly owned by Gold One, and has 30 years' experience relevant to the style of mineralisation and type of deposit under
consideration, and to the activity which he is undertaking, to qualify as a Competent Person for the purposes of both the JORC Code
and the SAMREC Code.
Dr Stewart and Messrs Meyer, Cook and Whittaker consent to the inclusion in this release of the matters based on information
compiled by themselves, Gold One employees, Rand Uranium employees and the companies’ consultants in the form and context in
which they appear for the purposes of both the JORC Code and the SAMREC Code
Further information on Gold One’s resource statement is available in the pre-listing statement of Gold One International Limited
issued on 19 December, 2008, and in the resource statements released in the Gold One 2011 Annual Report, released on 29
February 2012 on the ASX MAP, JSE SENS and the Gold One website. The company’s resource statements are also available on the
Gold One website.
SAMREC and JORC Terminology
In addition, this release uses the terms ‘indicated resources’ and ‘inferred resources’ as defined in accordance with the SAMREC
Code, prepared by the South African Mineral Resource Committee (SAMREC), under the auspices of the South African Institute of
Mining and Metallurgy (SAIMM), effective March 2000 or as amended from time to time and where indicated in accordance with the
Canadian National Instrument 43-101 – Standards for Disclosure for Mineral Projects. The terms ‘indicated resources’ and ‘inferred
resources’ are also defined in the 2004 Edition of the JORC Code, prepared by the Joint Ore Reserves Committee (JORC) of the
Australasian Institute of Mining and Metallurgy (AusIMM), the Australian Institute of Geoscientists (AIG) and the Minerals Council of
Australia (MCA). [The use of these terms in this release is consistent with the definitions of both the SAMREC Code and the JORC
Code.]
A mineral reserve (or ‘ore reserve’ in the JORC Code) is the economically mineable part of a measured or indicated resource
demonstrated by at least a preliminary feasibility study. This study must include adequate information on mining, processing,
metallurgical, economic and other relevant factors that demonstrate at the time of reporting that economic extraction can be
justified. A mineral reserve includes diluting materials and allows for losses that may occur when the material is mined. A proven
mineral reserve (or ‘proved ore reserve’ in the JORC Code) is the economically mineable part of a measured resource for which
quantity, grade or quality, densities, shape and physical characteristics are so well established that they can be estimated with
confidence sufficient to allow the appropriate application of technical and economic parameters to support production planning and
evaluation of the economic viability of the deposit. A probable mineral reserve (or ‘probable ore reserve’ in the JORC Code) is the
economically mineable part of an indicated mineral resource for which quantity, grade or quality, densities, shape and physical
characteristics can be estimated with a level of confidence sufficient to allow the appropriate application of technical and economic
parameters to support mine planning and evaluation of the economic viability of the deposit.
A mineral resource is a concentration or occurrence of natural, solid, inorganic or fossilised organic material in or on the earth’s crust
in such form and quantity and of such a grade or quality that it has reasonable prospects for economic extraction. The location,
quantity, grade, geological characteristics and continuity of a mineral resource are known, estimated or interpreted from specific
geological evidence and knowledge. A measured mineral resource is that part of a mineral resource for which quantity, grade or
quality, densities, shape and physical characteristics can be estimated with a level of confidence sufficient to allow the appropriate
application of technical and economic parameters to support mine planning and evaluation of the economic viability of the deposit.
35 | P a g e
The estimate is based on detailed and reliable exploration, sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits, workings and drillholes that are spaced closely enough to confirm both
geological and grade continuity. An indicated mineral resource is that part of a mineral resource for which quantity, grade or quality,
densities, shape and physical characteristics can be estimated with a level of confidence sufficient to allow the appropriate
application of technical and economic parameters to support mine planning and evaluation of the economic viability of the deposit.
The estimate is based on detailed and reliable exploration and testing information gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drillholes that are spaced closely enough for geological and grade continuity
to be reasonably assumed. An inferred mineral resource is that part of a mineral resource for which quantity and grade or quality
can be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified, geological and
grade continuity. The estimate is based on limited exploration and sampling gathered through appropriate techniques from locations
such as outcrops, trenches, pits, workings and drillholes. Mineral resources which are not mineral reserves do not have
demonstrated economic viability. Investors are cautioned not to assume that all or any part of the mineral deposits in the measured
and indicated resource categories will ever be converted into reserves. In addition, “inferred resources” have a great amount of
uncertainty as to their existence and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral
resource will be ever be upgraded to a higher category. Under South African and Australian rules, estimates of inferred mineral
resources may not form the basis of feasibility or pre-feasibility studies or economic studies except under conditions noted in the
SAMREC Code and the JORC Code, respectively.
Investors are cautioned not to assume that all or any part of an inferred resource exists or is economically or legally mineable.
Exploration data is acquired by Gold One and its consultants under strict quality assurance and quality control protocols.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained
herein.
Date: 30/07/2012 07:16:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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