Wrap Text
Quarterly Activities Report
Quarter Ended 31 March 2013
Gold One International Limited
Registered in Western Australia under the Corporations Act, 2001 (Cth) with registration number ACN: 094 265 746
(Registered in South Africa as an external company with registration number 2009/000032/10)
ISIN: AU000000GDO5
Share Code on the ASX/JSE: GDO
OTCQX International: GLDZY
("Gold One" or the “company”)
30 April 2013
Quarterly Activities Report
Quarter Ended 31 March 2013
March 2013 Quarter Highlights
- 61,853 ounces of gold production
- Revenue of US$ 95.79 million; the highest quarterly revenue ever recorded in the Gold One Group
- 100% quarter-on-quarter increase in group operating cashflow to US$ 31.04 million
- Positive cashflow from total operations of US$ 14.32 million; an improvement of US$ 11.15 million from
previous quarter
- Group cash cost decreases by 19% from previous quarter to US$ 1,047/oz
- Cooke Underground Operation sustains operational profitability; operating cashflow of US$ 7.08 million
- Positive cashflow from Cooke Underground Operation of US$ 2.35 million; an improvement of US$ 21.61
million from previous quarter
June 2013 Quarter Outlook
- June 2013 quarter production forecast of 70,750 ounces
- 30,000 ounces from Modder East Operation
- 32,000 ounces from Cooke Underground Operation
- 8,750 ounces from Randfontein Surface Operation
March 2013 Quarter Key Performance Data
(Average Exchange Rate of ZAR 8.94 / US$ 1)
(December 2012 Quarter Average Exchange Rate of ZAR 8.20 / US$ 1)
Group Group
Cooke 1-4 Randfontein
Modder East Production Production
Underground Surface
Operation March 2013 December
Operations Operation
Quarter 2012 Quarter
Ore Mined
166 612 t 279 402 t
Underground
Mined Grade 5.85 g/t 5.17 g/t 0.426 g/t
Milled Tonnes 156 934 t 256 109 t 895 492 t
Recovered Grade 4.44 g/t 3.62 g/t 0.309 g/t
Gold Recovery 95% 94% 72.6%
Gold Produced 23 159 oz 1 29 784 oz 2 8 910 oz 61 853 oz 57 584 oz
Cash Cost 3 US$ 615/oz US$ 1 350/oz US$ 1 155/oz US$ 1 047/oz US$ 1 296/oz
Total Cost 4 US$ 837/oz US$ 1 562/oz US$ 1 253/oz US$ 1 246/oz US$ 1 535/oz
Average Gold Price
US$ 1 641/oz US$ 1 616/oz US$ 1 616/oz US$ 1 625/oz US$ 1 487/oz
Received
Gross Cash Margin US$ 1 026/oz US$ 266/oz US$ 461/oz US$ 578/oz US$ 191/oz
Group Development US$ 16.87 US$ 15.57
and Capital Expenditure million million
US$ 95.79 US$ 91.76
Group Gold Revenue
million million
Notes:
1
Includes 738 ounces from the treatment of 8,177 tonnes of low grade development ore, mud and mill rejects at an average
recovered grade of 2.81 grams per tonne.
2
Includes 12 ounces produced at the Cooke Underground Operation by the treatment of 1,483 tonnes of low grade development
ore and sludge 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 Review
For the March 2013 quarter the Gold One Group produced a total of 61,853 ounces of gold; marginally lower
than the forecast of 63,500 ounces. The Randfontein Surface Operation exceeded guidance by 5%, while the
Cooke Underground Operation narrowly missed guidance by 1%. Modder East’s production for the quarter
was 7% below guidance primarily as a result of the ongoing production build up at the operation post the
illegal industrial action that took place during June 2012.
It is with regret that we report that one of our colleagues, Mr Alex Mandlate, a production assistant, was
fatally injured during the quarter as a result of a blasting incident at the Cooke 4 Operation. We extend our
heartfelt condolences to Mr Mandlate’s family and friends.
Safety for the group, measured according to the lost-time injury rate per 200,000 hours worked (“LTIFR”),
was 1.78 for the March 2013 quarter. This LTIFR compares to the December 2012 quarter’s LTIFR of 1.2 and
remains above the group’s benchmark of 1.0. Gold One remains committed to achieving injury-free
operations and best practices are continually entrenched across the Gold One Group through the company’s
safety motto that ‘nothing is so important that it cannot be done safely’. All safety endeavours and thorough
and sustainable safety practises remain key managerial focuses throughout Gold One.
I am pleased to report that the positive operational performance seen towards the end of 2012 has
continued into 2013. The group cash cost for the quarter decreased from US$ 1,296/oz to US$ 1,047/oz,
reflecting a gross cash margin of US$ 578/oz. This cash cost decrease can in part be attributed to exchange
rate movement, but is primarily due to cost control measures and the restructuring of the Cooke
Underground Operation that took place late last year. Capital expenditure for the quarter was US$ 16.87
million, of which US$ 14.06 million was spent on orebody development, equipping and the Cooke Gold Plant
Optimisation Project. A positive cashflow from operations, measured after capital expenditure, of US$ 14.32
million was achieved.
At Modder East we have continued to achieve post-strike records with all leading indicators trending
towards our targeted steady state production levels. Recruitment of needed critical skills remains Modder
East’s primary challenge, which during the March 2013 quarter negatively impacted the total production
achieved. I am pleased to report, however, that despite having been 1,841 ounces below guidance,
production at the operation during the March 2013 quarter was aligned to Modder East’s current staff
complement and skills availability, with record production efficiencies having been achieved. With plans in
place to internally train and develop the critical skills needed to increase production levels, I am confident
that we will achieve our forecast production rates in the near term.
The restructuring at the Cooke Underground Operation that was completed in December 2012 has already
had a positive impact. For the first time since the operation was acquired, the Cooke Underground
Operation recorded a positive quarterly contribution after capital expenditure of US$ 2.35 million for the full
March 2013 quarter. Despite the Cooke Underground Operation narrowly missing guidance by 216 ounces,
the operation exceeded the December 2012 quarter’s production output by 20% following the lifting of the
Cooke 4 suspension, which resulted from illegal industrial action during the December 2012 quarter.
Pleasingly recovered grade remained consistent despite the increase in production volumes, indicating that
initiatives taken to reduce unpay mining have been implemented sustainably. The aforementioned grade
and production profiles facilitated a 30% decrease in the unit cost of production at the Cooke Underground
Operation, with the unit cost amounting to US$ 1,350/oz for the quarter under review.
The Randfontein Surface Operation has continued to deliver a strong performance with the March 2013
quarter’s production amounting to 8,910 ounces; 410 ounces above guidance. The operation’s focus has
remained on the Cooke Gold Plant Optimisation Project, which will see the Cooke Gold Plant increase
throughput capacity from 300,000 tonnes per month to 400,000 tonnes per month. The plant’s expansion
and commissioning are on track for completion during the December 2013 quarter.
Gold One is continuing to progress its extensive internal project pipeline as well as the proposed Sibanye
Gold Limited (“Sibanye Gold”) and Gold One Joint Venture, which is investigating the potential to jointly
exploit the low risk characteristics of both companies’ surface tailings assets across Johannesburg’s West
Rand. In particular, Gold One is focusing its project efforts and expenditure on those projects with short
operational lead times that can benefit the existing operations and generate a positive return in the near
term.
During the quarter Gold One updated the mineral resource and mineral (ore) reserve estimations for
Modder East, the Cooke 1-3 Underground Operations and the Randfontein Surface Operation. In addition,
the mineral resources for Goliath Gold Mining Limited (“Goliath Gold”) (of which Gold One is the 72%
majority shareholder) were also updated following an extensive exploration programme undertaken during
2012. The Ventersburg and Modder North mineral resource estimates were also updated during the quarter
under review and are currently undergoing independent external auditing. The mineral resources for the
Turnbridge and New Kleinfontein projects have been reviewed but remain unchanged from those reported
in the company’s 2011 and 2012 annual reports. The mineral resources and mineral (ore) reserves for the
Cooke 4 Operation are being undertaken currently and will be completed during the June 2013 quarter.
The company’s total gold mineral resources now total 31.99 million ounces, comprising 19.89 million ounces
in the measured and indicated category (443.68 million tonnes at 1.39 grams per tonne) and 12.11 million
ounces in the inferred category (108.78 million tonnes at 3.46 grams per tonne). Total proved and probable
reserves now total 3.64 million ounces (122.7 million tonnes at 0.92 grams per tonne).
In addition, during the March 2012 quarter Gold One also declared uranium mineral resources and mineral
(ore) reserves at the Cooke 1-3 Underground Operations and the Randfontein Surface Operation. Total
estimated uranium resources include 85.9 million pounds, comprising 82.8 million pounds in the measured
and indicated category (315.0 million tonnes at 0.12 kilograms per tonne) and 3.1 million pounds in the
inferred category (2.6 million tonnes at 0.54 kilograms per tonne). Proved and probable uranium mineral
(ore) reserves total 36.6 million pounds (88.5 million tonnes at 0.19 kilograms per tonne).
Despite the current volatile price environment, the company’s focus during the upcoming quarter remains
unchanged. Our primary focus areas include: managing and consolidating the cost base across the Cooke
Underground Operation following the operation’s recent restructure; training and recruiting to achieve the
required staffing levels at Modder East to drive increased production volumes; and expanding our surface
operations to increase volume throughput of hydraulically reclaimed slime at significantly reduced milling
costs.
2. Financial Review
Schematic: Gold One Group Quarterly Gold Sales and Revenue
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
Group gold revenue for the March 2013 quarter amounted to US$ 95.79 million from the sale of 57,860
ounces at an average price of US$ 1,625/oz. This was up marginally from the revenue achieved for the
December 2012 quarter and comprised 57,328 ounces of gold sold into the spot market at an average price
of US$ 1,637/oz, and 532 ounces delivered into the hedge book at an average price of US$ 404/oz. The gold
sales and revenue were adversely affected by the early close of Rand Refinery at the end of the quarter.
The aforementioned hedge ounces were the ounces sold to the Franco Nevada Corporation (“Franco
Nevada”) in terms of the Franco Nevada gold royalty, which was inherited with the acquisition of Cooke 4
and where 7% of gold produced from Cooke 4 is delivered to Franco Nevada at a fixed price of US$ 404/oz.
Cooke Randfontein Total
Modder East Surface December 2012
Cashflow Underground March 2013
Operation Operation Quarter
(Unaudited) Operation Quarter
(US$ Million) (US$ Million) (US$ Million)
(US$ Million) (US$ Million)
Gold Sales 34.11 47.29 14.39 95.79 91.77
Payment to
Operating
-14.25 -40.21 -10.29 -64.75 -76.24
Suppliers and
Employees
Operating
19.86 7.08 4.10 31.04 15.53
Cashflow
Development
and Capital -4.35 -4.73 -7.64 -16.721 -12.36
Expenditure
Cashflow from
15.51 2.35 -3.54 14.32 3.17
Operations
Notes:
1
Excludes US$ 0.15 million of project capital.
The Cooke Underground Operation and Randfontein Surface Operation’s hedge book totalled 48,696 ounces
at 31 March 2013 at an average deliverable price of ZAR 10,012/oz.
Payments to operating suppliers and employees totalled US$ 64.75 million for the quarter, resulting in an
operating cashflow of US$ 31.04 million. The Modder East, Cooke Underground and Randfontein Surface
operations contributed US$ 19.86 million, US$ 7.08 million and US$ 4.10 million to this cashflow
respectively.
Group development and capital expenditure totalled US$ 16.87 million with the Modder East, Cooke
Underground and Randfontein Surface operations’ expenditures totalling US$ 4.35 million, US$ 4.73 million
and US$ 7.64 million respectively. The Randfontein Surface Operation’s projects included a portion of the
ZAR 230 million Cooke Gold Plant Optimisation Project, which intends to extend the Cooke Gold Plant’s
nameplate capacity from 300,000 tonnes per month to 400,000 tonnes per month to achieve improved
economies of scale. The remaining projects within the group incurred US$ 0.15 million in development and
capital expenditure during the quarter under review.
Positive cashflow from operations for the March 2013 quarter therefore totalled US$ 14.32 million, which
reflects a US$ 11.15 million improvement from the December 2012 quarter’s US$ 3.17 million.
Gold One ended the quarter under review with a cash balance of US$ 77.74 million (including restricted cash
of US$ 39.17 million) and excluding gold receivables amounting to US$ 12.06 million. This compares to a
cash balance of US$ 85.30 million (including restricted cash of US$ 37.25 million) and gold receivables of US$
8.88 million at the end of the December 2012 quarter, and reflects a 9% quarter-on-quarter decrease. The
decrease in the cash balance is largely due to interest and capital repayments made on the Gold One
Group’s loans. An additional shareholder loan of US$ 23 million was received during the quarter under
review and was provided in order to reduce the capital owing on the Investec facility and to provide Gold
One with additional working and project capital. A portion of the loan will be used to procure long lead
capital items planned for the Cooke Gold Plant Optimisation Project.
It is expected that final payment for the acquisition of the Pamodzi East Rand Operations assets (described in
the Group Development Section of this quarterly report) will be made during either the end of the June 2013
quarter or the beginning of the September 2013 quarter. The payment will total US$ 6.34 million (ZAR 58.5
million) from Gold One and US$ 0.49 million (ZAR 4.5 million) from Goliath Gold.
At quarter-end Gold One reflected debt of US$ 246.20 million (principal amount of US$ 243.29 million and
interest of US$ 2.91 million). This debt is made up of shareholder loans received amounting to US$ 146.15
million and an Investec facility amounting to US$ 100.05 million. An interest and capital repayment of US$
13.97 million against the Investec facility was made post the end of the quarter, on 1 April 2013.
3. Group Operational Review
March 2013 December 2012
Variance
Quarter Actual Quarter Actual
Gold One Group 61 853 oz 57 584 oz 4 269 oz 7%
March 2013 March 2013
Variance
Quarter Actual Quarter Guidance
Modder East Operation 23 159 oz 25 000 oz -1 841 oz -7%
Cooke Underground Operation 29 784 oz 30 000 oz -216 oz -1%
Randfontein Surface Operation 8 910 oz 8 500 oz 410 oz 5%
Total 61 853 oz 63 500 oz -1 647 oz -3%
3.1. Modder East Operation
March 2013 December 2012
Modder East Operation
Quarter Quarter
Ore Mined Underground 166 612 t 151 563 t
Mined Grade 5.85 g/t 6.69 g/t
Milled Tonnes (Black Reef) 156 934 t 137,229 t
Recovered Grade 4.44 g/t 4.87 g/t
Gold Recovery 95% 95%
Gold Produced 23 159 oz 1 23 201 oz 2
Cash Cost3 US$ 615/oz US$ 747/oz
Notes:
1
Includes 738 ounces from the treatment of 8,177 tonnes of low grade development ore, mud and mill rejects at an average
recovered grade of 2.81 grams per tonne.
2
Includes 1,705 ounces from the treatment of 27,413 tonnes of low grade development ore, mud, mill rejects and UK9A
development ore at an average recovered grade of 1.93 grams per tonne.
3
Cash cost refers to all costs directly associated with mining activities, mine administration, processing and refining.
Schematics: Modder East - Milled Tonnage Profile and Recovered Grade as well as Quarterly Production and Cash Cost
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
As at the end of the quarter under review, Modder East’s 2013 progressive LTIFR amounted to 0.38. This
reflects an improvement on the operation’s 2012 progressive LTIFR of 0.79.
Overall gold production at Modder East for the quarter was 7.3% or 1,841 ounces below the quarter’s
forecast of 25,000 ounces primarily due to slower than anticipated post-strike labour recruitment, which
aimed to replace critical skills, including rock drill operators and winch drivers, that were dismissed as a
result of the illegal strike that began on 4 June 2012. Recruitment and training of these core skills remains
the key challenge facing the operation and subsequently a number of initiatives have been introduced,
including internal promotional training, the use of recruitment companies, and the engagement of social
community structures to enable the responsible introduction of externally sourced labour and their families
into the local community.
The operation has identified the critical skills required to bring daily production volumes in line with forecast
levels to achieve Modder East’s production guidance, and it is anticipated that these levels will be reached
by the end of the June 2013 quarter with the recruitment of skilled labour expected to continue at current
rates.
Although production was below forecast for the quarter under review, continual operational improvements
resulted in a strong March 2013 quarter performance despite the slower than expected start to the year
following the festive holidays.
Schematics: Modder East Square Metres Mined and Modder East Square Metres/ Total Employee Costed
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
The continuous improvement at Modder East was clearly evident during the quarter with total tonnes (reef
and waste rock) trammed for the March month reaching nearly 85,000 tonnes; the operation’s best ever
total production level.
Total production volumes for reef mined at Modder East during the March 2013 quarter amounted to
166,612 tonnes at an average grade of 5.85 grams per tonne. Of the 166,612 tonnes, 164,402 tonnes of
Black Reef were mined of which 137,455 tonnes were attributable to stoping tonnes at an average grade of
6.72 grams per tonne, 26,882 tonnes were attributable to trackless reef development tonnes at 1.71 grams
per tonne, and 65 tonnes were attributable to conventional reef development tonnes at 5.18 grams per
tonne. The balance of the tonnage was attributed to development on the UK9A Reef.
During the quarter a significant milestone was achieved when additional underground rock storage facilities
were commissioned, facilitating the underground separation of Black Reef generated in stopes from Black
Reef generated in trackless reef development ends. This strategy will ensure flexibility to optimise feed
grade through the Modder East Metallurgical Plant. The Black Reef recovered grade for the quarter was 4.44
grams per tonne; 9% lower than the Black Reef recovered grade achieved in the December 2012 quarter.
The decrease in recovered grade was largely due to an increase in mechanised on-reef development.
Volumes from stoping are expected to increase significantly during the June 2013 quarter as the operation
recruits the skills necessary to break additional stope tonnes. The increase in proportion of higher grade
stoping tonnes, together with the additional storage flexibility, is expected to lead to an increase in overall
mined and recovered grades.
In anticipation of increasing tonnage during the June 2013 quarter, the secondary crushing plant, which was
constructed to increase processing capacity from 70,000 tonnes per month to 100,000 tonnes per month, is
currently being commissioned using low grade development ore. The secondary crushing plant is forecast to
be fully operational during the September 2013 quarter as the operation ramps up to achieve steady state
production.
Despite a reduced recovered grade the cash cost for Modder East decreased by 18% from US$ 747/oz for
the December 2012 quarter to US$ 615/oz for the quarter under review. This is due to a combination of
factors including increased mining volumes, decreased operational costs and a weaker exchange rate
variance between the quarters.
A total of 35,760 square metres was mined during the March 2013 quarter compared to 32,482 square
metres mined during the December 2012 quarter, equating to a 10% quarter-on-quarter improvement. The
improvement in square metres mined resulted from the introduction of additional labour and the improved
efficiencies of the operation’s more established mining teams.
Total on-reef development increased marginally by 3% from the December 2012 quarter’s 501 metres to
514 metres for the March 2013 quarter. This increase can be attributed to mechanised on-reef
development, which increased by 20% from 377 metres for the previous quarter to 450 for the quarter
under review. The increase in mechanised on-reef development was the direct result of the successful
introduction of recruited labour.
Mechanised off-reef development doubled from 332 metres for the December 2012 quarter to 660 metres
for the March 2013 quarter. This increase was achieved through successful labour recruitment in the
mechanised section as well as improved efficiencies. Total trackless development for the quarter under
review reflected a 57% quarter-on-quarter increase, amounting to 1,110 metres compared to the previous
quarter’s 709 metres.
At the end of the March 2013 quarter 413,530 square metres were available for mining, compared to
354,226 square metres at the end of the December 2012 quarter. This translates to in excess of two years of
mining at current and planned production rates. The increase in square metres available for mining is
attributable to the operation’s focus on mechanised on-reef development to create continued mining
flexibility.
For the quarter under review 165,111 tonnes were milled and treated at the Modder East Metallurgical
Plant. Tonnes treated included 156,934 tonnes of Black Reef with the balance comprising 8,177 tonnes of
low grade development ore, mud and mill rejects. Metallurgical recoveries remained consistent at 95%.
3.1.1. Mineral Resources and Mineral (Ore) Reserves
Mineral resource and mineral (ore) reserve estimations at Modder East were updated during the March
2013 quarter and were published in the Gold One 2012 Annual Report. The updated resource estimates
have been used to update the Modder East Operation’s life of mine and associated mineral (ore) reserves,
and are tabled on the following page.
Modder East Mineral Resource Statement
MODDER EAST MINERAL RESOURCE STATEMENT 1
Tonnes Grade Gold content
Measured (MT) (G/T) (MOZ)
Buckshot Pyrite Leader Zone + Basal Unit 2 0.49 9.34 0.15
Total Measured 0.49 9.34 0.15
Indicated
Buckshot Pyrite Leader Zone + Basal Unit 2 7.39 5.29 1.26
Black Reef Basal Unit 3 16.62 1.26 0.67
UK9A 4 3.53 4.10 0.47
Buckshot Pyrite Leader Zone 2 6 0.35 3.41 0.04
Total Indicated 27.89 2.71 2.44
Total Indicated and Measured 28.38 2.83 2.58
Inferred
Buckshot Pyrite Leader Zone + Basal Unit 2 1.42 2.11 0.10
Black Reef Basal Unit 3 19.30 0.69 0.43
UK9A 4 3.88 3.06 0.38
UK5 5 9.41 1.82 0.55
Buckshot Pyrite Leader Zone 6 1.06 2.99 0.10
Total Inferred 35.08 1.38 1.56
Total Resource 63.45 2.03 4.14
1 Mineral resources are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC standards).
Cut-off values have been reported using a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1). Mineral resources are reported inclusive of
ore reserves.
2 Signed-off by J. Glanville of Glanville Consulting, independent resource consultant to Gold One, audited by SRK. Reported at a cut-off of 171 cmg/t.
3 Signed-off by J. Glanville of Glanville Consulting, independent resource consultant to Gold One, audited by SRK, reported at a cut-off of 233 cmg/t.
4 Signed-off by Minxcon, independent resource consultants to Gold One, audited by SRK, restated at revised cut-off off at 166 cmg/t.
5 Signed-off by Minxcon, independent resource consultants to Gold One, audited by SRK, reported at a cut-off of 496 cmg/t.
6 Signed-off by Shango Solutions, independent resource consultants to Gold One, audited by SRK, reported at a cut-off of 141 cmg/t.
Modder East Mineral (Ore) Reserve Statement 1
Tonnes Grade Gold content
(Mt) (G/t) (MOz)
Proved
Buckshot Pyrite Leader Zone + Basal Unit 2 0.23 5.78 0.04
Total Proved 0.23 5.78 0.04
Probable
Buckshot Pyrite Leader Zone + Basal Unit 2 5.29 4.81 0.82
UK9A 3 3.04 3.38 0.33
Total Probable 8.33 4.29 1.15
Total Reserve 8.57 4.33 1.19
1 Mineral (ore) reserves are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC
standards). Mineral reserves are planned for extraction using a pay limit based on a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1).
2 Reported at a pay limit of 192 cmg/t .
3 Reported at a pay limit of 183 cmg/t .
3.2. Cooke Underground Operation
March 2013 December 2012
Cooke Underground Operation
Quarter Quarter
Ore Mined Underground 279 402 t 211 549 t
Mined Grade 5.17 g/t 5.31 g/t
Milled Tonnes 256 109 t 211 749 t
Recovered Grade 3.62 g/t 3.64 g/t
Gold Recovery 94% 94%
Gold Produced 29 784oz 1 24 750 oz 2
Cash Cost 3 US$ 1 350 /oz US$ 1 926/oz
Notes:
1
Includes 12 ounces produced at the Cooke Underground Operation by the treatment of 1,483 tonnes of low grade
development ore and sludge at a recovered grade of 0.26 grams per tonne.
2
Includes 30 ounces produced at the Cooke Underground Operation by the treatment of 695 tonnes of low grade
development ore and mud at a recovered grade of 1.35 grams per tonne.
Schematics: Cooke Underground Quarterly Tonnage Profile and Recovered Grade
Cooke Underground Quarterly Production and Cash Cost
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
During the quarter under a review Mr Alex Mandlate, a production assistant, was fatally injured as a result of
a blasting incident at the Cooke 4 Operation.
The progressive LTIFR for the quarter amounted to 2.63, compared to the operation’s LTIFR for the
December 2012 quarter of 1.74. A task team, comprising representatives from Management and organised
labour, has been established to investigate and provide action plans to address the Cooke 1-4 Underground
Operations’ recent poor safety performance.
Gold production for the March 2013 quarter amounted to 29,784 ounces; 1% below the forecast of 30,000
ounces. This was produced from 256,109 tonnes milled at an average recovered grade of 3.62 grams per
tonne. The increase in gold output for the March 2013 quarter resulted largely from an increase in milling
throughput from 211,749 tonnes to 256,109 tonnes, which included a contribution from Cooke 4 following
the lifting of the operational suspension that was placed on the shaft during the December 2012 quarter due
to illegal industrial action.
The elimination of marginal and unpay mining through the reduction of 25 stoping crews at the Cooke 1,2
and 3 shafts has resulted in sustained improved gold grade. During the quarter under review, broken grades
of 5.17 grams per tonne were achieved and the associated average recovered grade of 3.62 grams per tonne
was maintained quarter-on-quarter despite substantial increases in mining volumes. The aforementioned
grade and production profiles facilitated a 30% decrease in the unit cost of production at the Cooke
Underground Operation, with the unit cost amounting to US$ 1,350/oz for the quarter under review.
Square metres at the Cooke Underground Operation increased from 26,215 square metres to 42,969 square
metres over the quarter as operations resumed at Cooke 4. Square metre production for the Cooke 1-3
shafts improved by 12% to 25,739 square metres. This significant performance was achieved despite the
application of a four day self-imposed stoppage at Cooke 4 following the fatal accident involving Mr Alex
Mandlate.
Total development for the March 2013 quarter was 5,038 metres compared to the previous quarter’s 4,416
metres, including 1,273 metres developed at Cooke 4. Development at the Cooke 1-3 shafts was negatively
impacted by a combination of critical skills shortages following the December festive holidays as well as the
movement of development crews at Cooke 2 to higher grade areas. It is expected that development rates
will increase during the June 2013 quarter to those levels previously achieved. Development will be further
supported by raise-boring an airway at Cooke 1, which is expected to positively impact the operation’s
development metres in the short term and improve mining flexibility in the medium to long term.
Tonnage for the quarter from the Cooke 1-3 shafts was treated at both the Doornkop Plant and the Cooke
Gold Plant. Total tonnage through the Doornkop Plant amounted to 176,412 tonnes, producing 20,591
ounces of gold at a yield of 3.63 grams per tonne. Recovery at the Doornkop Plant dropped over the quarter
from 94% to 93% largely due to carbon management in the carbon-in-pulp circuit. This decrease negatively
affected plant accountability, which decreased from 100.2% to 98.7%. Recovery at the Doornkop Plant has
since been rectified with recoveries back up to acceptable levels of 95%. The mine call factor improved by
5% during the March 2013 quarter, amounting to 74.7%. The total Cooke 1-3 tonnage treated at the Cooke
Gold Plant for the quarter was 10,586 tonnes, which produced 1,504 ounces at an average recovered grade
of 4.42 grams per tonne.
Cooke 4 Shaft tonnage for the quarter was treated through the Cooke 4 Gold Plant and amounted to 70,594
treated tonnes, which yielded 7,689 ounces of gold from a recovered grade of 3.39 grams per tonne.
Recovery for the Cooke 4 Gold Plant amounted to 95.9%.
3.2.1. Mineral Resources and Mineral (Ore) Reserves
The mineral resource and mineral (ore) reserve estimations for the Cooke 1-3 Underground Operations were
updated during the quarter under review. These updates were published in Gold One 2012 Annual Report,
and are shown on the following page on this quarterly report.
Cooke 1-3 Underground Mineral Resource Statement 1
Gold Uranium
Tonnes Grade Gold Tonnes4 Grade Uranium content
content
(MT) (G/T) (MOZ) (MT) (KG/T) (MLBS)
Measured
Cooke 1 9.41 4.73 1.43 0.69 0.26 0.40
Cooke 2 8.76 4.92 1.38 3.50 0.38 2.95
Cooke 3 12.53 5.84 2.35 10.53 0.52 12.04
Total Measured 30.70 5.24 5.17 14.72 0.47 15.39
Indicated
Cooke 1 13.68 3.74 1.64 0.29 0.27 0.17
Cooke 2 3.07 4.55 0.45 1.81 0.34 1.36
Cooke 3 12.06 4.31 1.67 10.04 0.50 11.11
Total Indicated 28.81 4.06 3.76 12.14 0.47 12.64
Total Indicated 59.51 4.67 8.93 26.86 0.47 28.03
and Measured
Inferred
Cooke 1 6.36 3.71 0.76 0.16 0.36 0.13
Cooke 2 1.06 5.50 0.19 0.37 0.30 0.24
Cooke 3 7.84 5.01 1.26 2.09 0.60 2.75
Total Inferred 15.26 4.50 2.21 2.63 0.54 3.12
Total Resource 74.77 4.63 11.14 29.49 0.48 31.15
1 Mineral resources are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC standards).
Mineral resources are reported inclusive of ore reserves. Where ore is to go through the uranium recovery plant, the gold mineral resources must have
a gold equivalent cut-off of 2.9 g/t, or a combined gold cut-off grade of 2.5 g/t with an uranium fraction cut-off at 0.184kg/t. The gold equivalent
grade is calculated as 1g/t Au = 0.466 kg/t U3O8. The U3O8 mineral resource is declared at a cut-off grade of 0.184 Kg/t within the gold resource,
or as a co-product with gold at the gold equivalent cut-off of 2.9 g/t. The gold equivalence ratio is calculated at a gold price of $1750/oz and at a
uranium price of $65/lb, and an exchange rate of ZAR8:US$1. The U3O8 tonnes are a subset of the Au tonnes. The balance of the Au tonnes contain
gold above the gold cut-off grade but uranium below the uranium cut-off grade, and will therefore bypass the uranium recovery plant. Signed-off by
Dr I.C. Lemmer, independent resource consultant to Gold One, audited by SRK Consulting.
Cooke 1-3 Underground Mineral (Ore) Reserve Statement 1
Gold Uranium
Tonnes Grade Gold Tonnes4 Grade Uranium content
content
(MT) (G/T) (MOZ) (MT) (KG/T) (MLBS)
Proved
Cooke 1 0.29 4.84 0.05
Cooke 2 1.36 4.98 0.22
Cooke 3 3.59 4.26 0.49 1.17 0.43 1.10
Total Proved 5.25 4.48 0.76 1.17 0.43 1.10
Probable
Cooke 1 0.69 9.63 0.21
Cooke 2 0.30 6.97 0.07
Cooke 3 3.27 4.14 0.44 1.06 0.50 1.16
Total Probable 4.26 5.23 0.72 1.06 0.50 1.16
Total Reserve 9.51 4.82 1.47 2.23 0.46 2.26
1 Mineral (ore) resreves are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC
standards). The mineral reserves are planned for extraction using a pay limit that is based on a gold price of ZAR450,000/kg (US$1750/oz and
ZAR8:US$1) and an uranium price of US$45/lb and ZAR8:US$1 up to end 2015 and an uranium price of US$65/lb and ZAR8:US$1 from 2016. Pay
limit values are 4.55 g/t, 4.63 g/t and 4.15 g/t for Cooke 1, Cooke 2 and Cooke 3 respectively. Audited by SRK Consulting.
3.3. Randfontein Surface Operation
Randfontein Surface March 2013 December 2012
Operation Quarter Quarter
Reclaimed Grade 0.426 g/t 0.457 g/t
Milled Tonnes 895 492 t 887 396 t
Recovered Grade 0.309 g/t 0.338 g/t
Residue Grade 0.117 g/t 0.119 g/t
Gold Recovery 73% 74%
Gold Produced 8 910 oz 9 633 oz
Cash Cost US$ 1 155 /oz US$1 081 /oz
Schematics: Randfontein Surface Tonnage Profile and Recovered Grade
Randfontein Surface Quarterly Productin and Cash Cost
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
As at the release of this report, the Randfontein Surface Operation had not experienced a lost-time injury for
the year thus far, and as such the operation’s progressive 2013 LTIFR at the end of the March 2013 quarter
was zero. This compares to the LTIFR for the December 2012 quarter of 0.7 and the operation’s progressive
LTIFR for the 2012 year of 1.08.
During the quarter under review the Cooke Gold Plant produced 10,414 ounces, of which 8,910 ounces were
attributable to the Randfontein Surface Operation alone and which included the mechanical reclamation of
Dump 20 sand and hydraulically reclaimed Cooke 2 slime. This reflects a decrease of 7% when compared to
the previous quarter’s gold produced from surface sources, principally as a result of the declining grade of
Dump 20 sand as the deposit approaches completion.
A total of 895,492 tonnes was treated from surface sources during the March 2013 quarter, reflecting an
increase of 8,096 tonnes when compared to the December 2012 quarter. The average head grade for the
quarter declined from 0.456 grams per tonne to 0.426 grams per tonne, while the residue grade declined
slightly from 0.119 grams per tonne to 0.117 grams per tonne, resulting in recoveries of 73% compared to
the previous quarter’s 74%.
The operation’s unit cash cost increased from US$ 1,081/oz for the December 2012 quarter to US$ 1,155/oz
for the March 2013 quarter largely due to the allocation of peripheral service costs not previously attributed
to the Randfontein Surface Operation. If these additional costs are excluded for the purpose of comparing
quarter-on-quarter costs, then the cash cost for the Randfontein Surface Operation remained relatively
stable at US$ 1,090/oz.
One of the 2013 key focus areas for the Randfontein Surface Operation is the Cooke Gold Plant Optimisation
Project, which was initiated at the beginning of the year. The project’s objective is to extend the Cooke Gold
Plant’s nameplate capacity from 300,000 tonnes per month to 400,000 tonnes per month to achieve
improved economies of scale. By changing from mechanical reclamation to hydraulic reclamation of a
predominantly slime material, reclamation costs will also be substantially reduced. Aligned to the reduction
in reclamation costs is the expected decrease in plant operating costs, which will result from the reduction
from six operating mills to only two mills. The reduction in mills will be facilitated by the use of finer slime
material, which does not require milling. Operational unit costs are expected to decrease by approximately
40%-45%. The total project capital cost is estimated to be ZAR 230 million and is on track for scheduled
commissioning in the December 2013 quarter.
3.3.1. Mineral Resources and Mineral (Ore) Reserves
An extensive exploration drilling programme was undertaken at the Randfontein Surface Operation during
2012 and included the drilling of Dump 20, Dump 20 Slimes, Dump 4, the Millsite Complex, the Lindum
Complex and the Cooke 2 Slimes. These drilling results, combined with additional drilling of the Cooke Dam
undertaken by Rand Uranium (Pty) Limited in 2010, were utilised to update the surface mineral resources
and mineral (ore) reserves.
Total surface resources include 2.72 million ounces of gold grading at 0.271 grams per tonne and 54.78
million pounds of uranium grading at 86 grams per tonne, all of which are in the measured and indicated
resource categories. The consolidated mineral resources for the Randfontein Surface Operation are tabled
on the following page of this report.
Randfontein Surface Mineral Resource Statement 1,2
Gold Uranium
Tonnes Grade Gold Tonnes Grade Uranium content
(MT) (G/T) (MOZ) (MT) (KG/T) (MLB)
Measured
Cooke Dam 2 79.30 0.264 0.68 79.30 0.186 32.49
Lindum 1 and 2 3 5.32 0.261 0.04
Millsite Complex Dump 38 4 18.14 0.267 0.16 18.14 0.063 2.53
Millsite Complex Dump 39 4 65.83 0.244 0.52 65.83 0.026 3.71
Millsite Complex Dump 40/41 4 61.36 0.253 0.50 61.36 0.040 5.46
Millsite Complex Dump 39 Buttress 4 3.49 0.263 0.03 3.49 0.016 0.12
Valley Dam 4 7.70 0.214 0.05 7.70 0.031 0.52
Dump 20 Sand 3 4.04 0.460 0.06
Dump 20 Slime Main 5 7.99 0.350 0.09
Dump 20 Slime NW 5 2.85 0.260 0.02
Cooke 2 Slimes 0.27 0.530 0.05
Total Measured 256.28 0.261 2.15 235.82 0.086 44.84
Indicated
Cooke Dam 2 7.00 0.400 0.09 7.00 0.119 1.84
Lindum 1A and 3 3 0.89 0.480 0.01
Dump 20 Slime Main 5 3.05 0.320 0.03
Dump 20 Slime NW 5 0.08 0.240 0.00
Old No.4 Dump 4 45.29 0.299 0.43 45.29 0.081 8.10
Total Indicated 56.31 0.315 0.57 52.29 0.086 9.94
Total Indicated and Measured 312.59 0.271 2.72 288.11 0.086 54.78
Inferred
Total Inferred 0.00 0.00 0.00 0.00 0.00 0.00
Total Resource 312.59 0.271 2.72 288.11 0.086 54.78
1 Mineral resources are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC standards)
considering a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1) and an uranium price of US$65/lb and ZAR8:US$1. Total in-situ mineral
resources are estimated. Mineral resources are reported inclusive of ore reserves.
2 Signed-off by SRK Consulting, independent resource consultants to Gold One.
3 Mineral Resources as declared by Rand Uranium (2010) prior to Gold One acquisition and currently under review by Gold One.
4 Signed off by Mr C Muller of Minxcon, independent resource consultant to Gold One.
5 Signed-off by Mr F de Bruin of Deswik Mining Consultants, independent resource consultants to Gold One.
Randfontein Surface Mineral (Ore) Reserve Statement 1,2
Gold Uranium
Tonnes Grade Gold Tonnes Grade Uranium content
(MT) (G/T) (MOZ) (MT) (KG/T) (MLB)
Proved
Cooke Dam 79.30 0.264 0.68 79.30 0.186 32.49
Dump 20 Sand 4.04 0.460 0.06
Dump 20 Slime Main 7.99 0.350 0.09
Dump 20 Slime NW 2.85 0.260 0.02
Cooke 2 Slimes 0.27 0.530 0.05
Total Proved 94.45 0.280 0.85 79.30 0.186 32.49
Probable
Cooke Dam 7.00 0.400 0.09 7.00 0.119 1.84
Dump 20 Slime Main 3.05 0.320 0.03
Dump 20 Slime NW 0.08 0.240 0.00
Total Probable 10.13 0.375 0.12 7.00 0.119 1.84
Total Reserve 104.58 0.289 0.97 86.30 0.181 34.33
1 Mineral (ore) reserevs are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC
standards) considering a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1) and an uranium price of US$65/lb and ZAR8:US$1.
2 Mineral reserves considers the total extraction of in-situ mineral resources.
4. Development and Exploration Projects
4.1. Modder North
During the March 2013 quarter a total of 3,361 diamond drill metres and 1,997 percussion drill metres were
completed at the Modder North project. Diamond drilling on MN24, MN25, MN34, MN35, MN39, MN40,
and MN62 were completed, while drilling on MN33, MN38 and MN49 commenced and will continue during
the June 2013 quarter. Total exploration costs during the quarter amounted to US$ 0.72 million.
4.1.1. Modder North Geological Model
An extensive survey peg dataset, captured from the mined-out portion of the Main Reef, southwest of the
current drilling areas, combined with the recent surface exploration drilling has facilitated the definition of a
well constrained geological structural model. Two primary exploration targets have been identified within
the Modder North project area. The Modder North Target Area 1 extends from 360 to 550 metres below
surface, and is depicted along with the Modder North Target Area 2 in Figure 4.1.1 on the following page of
this report. The Modder North Target Area 2 extends from 750 metres to 850 metres below surface. The
area between the two target areas comprises the remainder of the Holfontein tenement, which remains a
future prospective area pending further exploration data being obtained.
Figure 4.1.1: Data distribution for the Modder North exploration project area (Main Reef only).
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
Mineral resource blocks have been defined on the basis of data density and by the limits of data distribution,
as shown in Figure 4.1.2 below. The north target resource block (depicted in blue) represents a shallow
deposit with limited data, while the central mined block (purple) contains historic mining and is at risk of
rising waters flooding the historic underground mining areas. The main resource block (yellow) represents
the bulk of the Modder North area of interest and is the site of the current drilling programme. Pending
successful economic studies, these resources could be mined without intersecting historic underground
mining and hence are not impacted by underground flooding in the historically mined areas. The south
target resource block (green) represents a target area of deeper (750 to 850 metres below surface) Main
Reef potential, interpreted as a continuation of the main, historically mined, payshoot direction.
Figure 4.1.2: Modder North Main Reef resource blocks.
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
Gold One has compiled mineral resources for Modder North and these are currently being audited by SRK
Consulting (SA) (Pty) Limited prior to publication. These mineral resources will be used to underpin a pre-
feasibility study that will commence in April 2013, and will consider various Modder North access options
and operational synergies with Modder East.
Assay results received during the March 2013 quarter for the Modder North drilling programme are
indicated in the table below. In addition to the Main Reef, selected surface boreholes have intersected well
developed Black Reef. Black Reef Channel Facies was intersected in borehole MN40 and is 226 centimetres
thick, suggesting another potential area of interest for the Black Reef at a shallow depth of 136 metres
below surface. These Black Reef intersections will be followed up with additional in-fill drilling during the
2013 exploration campaign.
Assay Results Received for Modder North During the March 2013 Quarter
Dip Corrected
Depth (m) Bottom
BH_ID REEF Channel
Contact g/t 2 cm.g/t
Thickness (cm) 1
MN39 Main Reef 568.58 31 7.76 243
MN40 Black Reef Channel Facies 136.26 227 0.48 108
MN40 Main Reef 506.71 18 9.58 169
MN50 Main Reef 438.11 80 4.79 382
MN50_1D Main Reef 438.03 82 4.93 403
MN50_2D Main Reef 437.97 60 4.83 289
MN52 Buckshot Pyrite Leader Zone 176.12 21 1.54 32
MN52_1D Buckshot Pyrite Leader Zone 176.07 54 1.22 66
MN52_2D Buckshot Pyrite Leader Zone 176.12 21 1.00 21
MN62 Main Reef 467.33 38 4.88 185
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
MN34 Main Reef 435.58 39 6.11 240
MN34_1D Main Reef 434.96 48 8.20 391
MN34_2D Main Reef 435.21 35 0.32 11
MN35 Main Reef 425.59 48 0.25 12
MN35_1D Main Reef 425.57 45 2.35 105
MN35_2D Main Reef 425.54 56 0.91 51
Notes:
1
Channel thickness represents the true, dip corrected thickness of the reef.
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.
Four drill rigs are currently on-site and a fifth drilling rig is expected during the June 2013 quarter.
4.2. Ventersburg
The immediate focus at Ventersburg remains on completing the feasibility study, which is anticipated during
the June 2013 quarter. The finalisation of the project’s capital estimate, financial valuation and the final
study document are outstanding. The feasibility study will underpin any updated project mineral resource
and mineral (ore) reserve estimates.
All planned drilling activities at Ventersburg have been completed and no additional drilling is being
contemplated pending the final outcome of the feasibility study. While selected long lead environmental
baseline studies are continuing, other work has ceased pending the final outcome of the feasibility study.
During the quarter under review, a total exploration cost of US$ 0.34 million was incurred.
4.3. Tulo
The primary focus at Tulo during the previous two quarters has been the mapping, trenching and sampling
of a prominent two kilometre quartz vein outcrop, which forms the southern portion of a 20.5 kilometre
magnetic lineament that was identified during a high resolution helicopter-borne geophysical survey. During
the quarter under review exploration activities were limited due to the wet season, which restricted site
access.
To date 47 trenches have been excavated along two kilometres of strike in the southernmost part of the
magnetic lineament. Of these trenches 40 have exposed quartz veining, which has been sampled and
delivered for analysis to Performance Laboratories (Pty) Limited in South Africa. Initial sample results are
currently being modelled and are undergoing final quality assurance and quality control reviews, including
duplicate and round robin analyses. The final results are expected to be published during the June 2013
quarter.
The trench sampling results, combined with trench and surface mapping, will be utilised to define priority
drill targets. Where deemed appropriate the company is also considering ground magnetic surveys to refine
the definition of structural discontinuities associated with potentially mineralised quartz veins.
Expenditure at Tulo for the March 2013 quarter amounted to US$ 0.33 million.
4.4. Gold Fields West Rand Tailings Joint Venture
During the quarter the West Rand Tailings Joint Venture project with Sibanye Gold progressed according to
schedule. The significant amount of technical and economic work that has already been completed by both
companies has been used to fast-track the joint pre-feasibility assessment. During the pre-feasibility
assessment a comprehensive metallurgical test work programme will be carried out on Gold One’s Millsite
and Old 4 Dam tailings facilities. Further strategic phasing of capital will also be undertaken, as well as an
assessment of ways in which the scheduling of available feed material can be optimised. The outcome of the
pre-feasibility study is expected during the September 2013 quarter.
4.5 Zuurbekom Project
The Zuurbekom Project is an exploration project adjacent to the Cooke 1 and 2 shafts of the Cooke
Underground Operation, where several historic boreholes targeting the UE1A Reef have been drilled since
the 1980s. Figure 4.5.1 on the following page of this report indicates a recent re-interpretation of the UE1A
Eastern payshoot considering historic drilling information and underground sampling data from Cooke 1 and
Cooke 2 at the eastern extremity of the mine in the payshoot. The boundaries of Cooke 1 and 2 are shown in
relation to domains 6 (in green) and 9 (in yellow), which extend into the Zuurbekom Project. The existing
borehole locations are shown as black crosses. Planned boreholes are shown as magenta dots.
Figure 4.5.1. The boundaries of Cooke 1 and 2 are shown in relation to domains 6 (in green) and 9 (in yellow)
that extend into the Zuurbekom Project. The existing borehole locations are shown as black crosses with the
Planned boreholes are shown as magenta dots.
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
During the quarter under review, opening-up and equipping of the 101 Zuurbult Haulage East commenced
with a view to facilitate an underground exploration and development programme in support of the planned
surface drilling programme. During the June 2013 quarter, drilling of eight exploration holes with deflections
will commence from surface to intersect the UE1A Reef with the intention of improving resource confidence.
Pending the outcome of the exploration results, the additional potential mining of the Zuurbekom eastern
payshoot extension is expected to extend the life of Cooke 1 significantly. The close proximity of the existing
Cooke 1 and Cooke 2 underground infrastructure would allow development of this project to be significantly
fast tracked.
4.6 Cooke Shaft Backfill Project
Substantial opportunities have been identified at the Cooke Underground Operation to mine historical high
grade gold bearing pillar areas. These areas could be selectively extracted at high margin, lower volume
operations and would impact positively on total mine profitability and mining flexibility. The feasibility study
considering the implementation of backfill at the Cooke 2 Shaft has achieved a pre-feasibility level of
confidence and has progressed into the feasibility stage.
At Cooke 2 the reserve scheduling of the Venterdorp Contact Reef (“VCR”) pillar extraction and the UE7
footwall benching target has been completed, indicating an initial target in excess of 80,000 ounces of
recoverable gold. Further detailed investigations into adjacent VCR and UE7 areas at Cooke 2 are currently
being conducted in order to determine additional secondary extraction opportunities. Detailed backfill plant
designs are in progress and the development of a revised environmental management programme, in
support of commissioning the backfill plant, is underway. Backfill product test work has progressed well and
will continue during the June 2013 quarter.
4.7 Cooke Uranium Project
The Cooke Uranium Project considers the recommisioning of the Cooke 4 (Ezulwini) uranium plant to treat
uranium bearing ore from the Cooke 3 and Cooke 4 shafts. The feasibility study, targeting ore containing
economic gold and uranium at Cooke 3, has been completed, including the extraction of the water pillar that
forms part of the Cooke 3 resource. The mining of the water pillar area, however, will take place from the
Cooke 4 Shaft as this resource is below Cooke 3 Shaft infrastructure.
Mine design and scheduling have been completed and modelled at forecast uranium prices of US$ 45/lb.
The commencement of the uranium project will allow the Cooke Underground Operation to implement the
co-product mining strategy, whereby the mining and recovery of both gold and uranium will have the
benefit of increasing mining reserves and improving profitability. The opening up and re-equipping of access
to the Cooke 3 co-product reserves have commenced and will continue during the June 2013 quarter.
Uranium mining is planned to commence during the December 2013 quarter.
It is envisaged that gold and uranium bearing ore will initially be trucked and processed at Cooke 4 until such
time as permanent ore transport arrangements have been implemented. A detailed study investigating
various long term ore transport alternatives is currently being completed.
Phase 1 of the Cooke 4 Uranium Plant upgrade has commenced and will continue during the June 2013
quarter, with completion of the upgrade expected during the September 2013 quarter. The upgrade will
allow the 50,000 tonne per month module of the uranium plant to be commissioned at an estimated total
capital cost of ZAR 13 million (US$ 1.5 million). A second 50,000 tonne per month module in the uranium
plant will remain on care and maintenance until underground mining volumes of mixed gold and uranium
ore have sufficiently increased above the 50,000 tonne per month level. The construction of the Cooke 4 ore
receiving facility is planned to commence during the June 2013 quarter.
5. Group Mineral Resources and Ore Reserves
The Gold One Group’s mineral resources and mineral (ore) reserves as at 31 March 2013 are illustrated in
the tables that appear on the following two pages on this report. These include Gold One’s attributable
portion of Goliath Gold’s mineral resource estimate, completed in March 2013.
Gold One Consolidated Mineral Resource Statement 1
Gold Uranium
Tonnes Grade Gold Tonnes Grade Uranium Content
(MT) (G/T) (MOZ) (MT) (KG/T) (MlbS)
Measured
Modder East 2 0.49 9.34 0.15
Cooke 1-3 Underground 3 30.70 5.24 5.17 14.72 0.47 15.39
Randfontein Surface 3 256.28 0.26 2.15 235.82 0.09 44.84
Total Measured 287.47 0.81 7.47 250.54 0.11 60.23
Indicated
Modder East 2 27.89 2.71 2.44
Cooke 1-3 Underground 3 28.81 4.06 3.76 12.14 0.47 12.64
Randfontein Surface 3 56.31 0.32 0.57 52.29 0.09 9.94
Ventersburg 4 22.83 3.90 2.86
Turnbridge 5 1.92 2.70 0.17
Goliath Gold 7 15.52 4.36 2.17
Total Indicated 153.28 2.43 11.97 64.43 0.16 22.58
Total Measured and Indicated 440.75 1.37 19.44 314.97 0.12 82.80
Inferred
Modder East 2 35.08 1.38 1.56
Cooke 1-3 Underground 3 15.26 4.50 2.21 2.63 0.54 3.12
Ventersburg 4 11.44 3.50 1.29
Turnbridge 5 3.88 2.73 0.34
New Kleinfontein 6 2.47 6.90 0.55
Goliath Gold 7 40.64 4.72 6.16
Total Inferred 108.78 3.46 12.11 2.63 0.54 3.12
Total Measured, Indicated and 552.46 1.80 31.99 317.59 0.12 85.93
Inferred
1 Mineral resources are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC standards). Mineral resources
are reported inclusive of ore reserves.
2 Cut-off values have been reported using a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1).
3 Cut-off values have been reported using a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1) and a uranium price of $65/lb, and an exchange rate of ZAR8:US$1.
The uranium tonnes are a subset of the gold tonnes.
4 Cut-off values have been calculated using a gold price of US$1550/oz and an exchange rate of ZAR8:US$1. Signed-off by Dr I.C. Lemmer, independent resource consultant
to Gold One, audited by SRK Consulting.
5 Signed-off by S. Meadon, SRK Consulting. Reported at a cut-off of 200 cmg/t, calculated using a gold price of US$1,250/oz and an exchange rate of ZAR8:US$1.
6 Signed-off by Camden Geoserve, independent resource consultants to Gold One, audited by SRK Consulting. Reported at a cut-off of 200 cmg/t, calculated using a gold
price of US$750/oz and an exchange rate of ZAR7:US$1.
7 Reported as 72% attributable to Gold One based on Gold Ones equity portion of Goliath Gold. Cut-off values have been calculated using a gold price of US$1130/oz and
an exchange rate of ZAR7.70:US$1.
Gold One Consolidated Mineral (Ore) Reserve Statement 1
[insert table]
1 Mineral (ore) reserves are reported in accordance with SAMREC guidelines (estimates would be identical if reported in accordance with JORC
standards). Mineral reserves are planned for extraction using a gold price of ZAR450,000/kg (US$1750/oz and ZAR8:US$1).
2 Mineral reserves are planned for extraction using an uranium price of US$45/lb and ZAR8:US$1 up to end 2015 and an uranium price of US$65/lb
and ZAR8:US$1 from 2016.
3 Mineral reserves are planned for extraction using an uranium price of US$65/lb and ZAR8:US$1.
6. Outlook
Group Production Guidance
Total group gold production for the June 2013 quarter is forecast at 70,750 ounces; an 11% increase on
production guidance for the March 2013 quarter.
The Modder East Operation’s production outlook for June quarter is 30,000 ounces, reflecting a 30%
increase on the March 2013 quarter. During the June 2013 quarter the company will continue to recruit the
necessary skills to ramp up production at Modder East in anticipation of achieving steady state production.
Production outlook for the Cooke Underground Operation’s for the June 2013 quarter is 32,000 ounces,
reflecting a 7% increase on the March 2013. This increase is anticipated as a result of operations reaching
stability following the restructuring of the operation late last year.
For the Randfontein Surface Operation, the production outlook for the June 2013 quarter remains steady at
8,750 ounces. These production levels are expected despite the anticipated decline in grade as the Dump 20
sand feed source nears completion and will be achieved through the increased tonnage throughput at the
Cooke Gold Plant.
Group Development Outlook
Pamodzi East Rand Operations
On 17 April 2012 Gold One announced that the company had entered into an acquisition agreement through
its subsidiaries New Kleinfontein Mining Company Limited and Goliath Gold to acquire, inter alia, selected
surface assets and prospecting rights over the areas covered by the mining rights held by Grootvlei
Proprietary 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. The prospecting
applications have been formally accepted by the Department of Mineral Resources and it is expected that
the approval process will be completed by July 2013.
The anticipated completion of all conditions precedent to the acquisition of the Pamodzi East Rand
Operations has therefore been extended to 31 July 2013 by mutual agreement, and can be extended further
by mutual agreement.
Hong Kong Listing
The company continues to review the timing of a listing on the Hong Kong Stock Exchange. In the interim the
Gold One Group will remain focussed on building up the Modder East Operation to steady state production,
sustaining the turnaround performance at the Cooke Underground Operation and growing production at the
Randfontein Surface Operation.
7. Capital Structure
As at the release of this report the company has 1,416,538,989 shares on issue, of which 1,363,932,404
(96.3%) are held on the Australian register and 52,606,585 (3.7%) are held on the South African register. The
company has 41,169,326 unlisted options in issue.
Schematics: March 2013 Quarter ASX Trading Statistics
March 2013 Quarter JSE Trading Statistics
For the release with pictures and schematics, please refer to the company`s website hosted at www.gold1.co.za
ENDS
Johannesburg
30 April 2013
Sponsor
Macquarie First South Capital (Pty) Limited
Issued by Gold One International Limited
www.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 is a dual listed (ASX/JSE: GDO) mid-tier mining group with gold operations and gold and uranium prospects across Southern
Africa, and is 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.)
The Modder East Operations have continued to ramp up in production and produced 97,958 ounces of gold at an average cash cost
of US$ 686/oz during 2012. This was derived from 474,754 Black Reef milled tonnes at an average recovered grade of 6.00 grams per
tonne as well as the milling of 139,887 tonnes of low grade development ore and waste with an average recovered grade of 1.43
grams per tonne. The Modder East Metallurgical Plant maintained recoveries of 95% for 2012.
At the beginning of 2012, the Gold One Group expanded with the acquisition of Rand Uranium (Pty) Limited, which comprised the
Cooke 1, 2 and 3 Underground Operations and the Cooke surface assets (now known as the Randfontein Surface Operations) located
in the West Rand, 30 kilometres from Johannesburg. Through Gold One’s purchase of Rand Uranium (Pty) Limited, the company has
also acquired one of the world’s most advanced uranium projects, which envisages recovering uranium, gold and sulphur from the
above surface Cooke Tailings Dam. The Cooke Tailings Facility has a code compliant resource of 0.8 million ounces of gold and 34
million pounds of uranium. This exciting opportunity is being further explored with Sibanye Gold Limited as part of a larger surface
retreatment strategy on the West Rand.
During mid-2012 Gold One also completed its transaction with the First Uranium Corporation and acquired 100% of the Ezulwini
Mining Company (Pty) Limited, giving the company access to gold and uranium processing plants with nameplate capacities of
200,000 and 100,000 tonnes per month respectively. Ezulwini (now known as Cooke 4) is contiguous to the company’s Cooke
Underground and Randfontein Surface operations and forms part of the Cooke Underground Operations. Access to the uranium
26 | P a g e
production facility allows for near term production of uranium from underground ore mined at Cooke. In addition, the sharing of
services between Cooke 4 and Cooke 1-3 facilitates a reduction in operating costs.
For the 2012 year, the Cooke 1-3 Underground Operations produced 98,451 ounces at an average cash cost of US$1,558/oz. This
production was derived from the treatment of 961,802 milled tonnes at an average recovered grade of 3.17 grams per tonne as well
as the treatment of 39,650 milled tonnes of low grade development and waste material at an average recovered grade of 0.34 grams
per tonne. Plant recoveries for the operation were 95% for 2012.
Since Gold One assumed managerial control, Cooke 4 produced gold in the months of August, September and December only due to
illegal industrial action that temporarily halted the operation during October and November. For the three months 8,493 ounces
were produced. Total production for 2012 comprised 82,951 milled tonnes at an average recovered grade of 3.18 grams per tonne.
Due to the fact that the metallurgical plant was stopped for two months during the illegal industrial action, plant recoveries averaged
82% over the reporting period.
For the 2012 year the Randfontein Surface Operations produced 36,853 ounces from 3,286,633 milled tonnes at an average cash
cost of US$1,137/oz. Recovered grades during the year averaged 0.349 grams per tonne, with a gold recovery rate of 72%.
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 1,416,538,989 shares.
Perth Registered Address Registrars
79 Broadway, Nedlands, Western Australia, 6009 Boardroom Limited
PO Box 3438, Nedlands, Western Australia, 6009 Level 7
Telephone +61 8 6389 2688 207 Kent Street
Facsimile +61 8 6389 2588 Sydney
NSW
Johannesburg Corporate Office Australia
Constantia Office Park, Bridgeview House, Ground Floor 2000
Corner 14th Avenue and Hendrik Potgieter Street Tel: +61 2 9290 9600
Weltevreden Park, 1709, Gauteng, South Africa
Telephone: +27 11 726 1047 South African Transfer Secretaries
Fax: +27 11 726 1087 Computershare Investor Services
70 Marshall Street
Issued Capital Johannesburg
1,416,538,989 shares on issue 2001
Options (unlisted: 41,169,326
ADR ratio: 1 ADR = 10 ordinary shares Level 1 ADR Sponsor
The Bank of New York Mellon
Stock Exchange Listings Depositary Receipts Division
ASX/JSE Limited: GDO 101 Barclay St, 22nd Floor
OTCQX International: GLDZY New York, New York 10286
USA
Directors Tel: +1 212 815 3700
- C Chadwick (CFO and Acting CEO) Fax: +1 212 571 3050
- Y Sun (Chairman)
- A Liu (Independent Non-Executive Director) Auditors
- R Chan (Independent Non-Executive Director) PricewaterhouseCoopers Incorporated
- M Solomon (Independent Non-Executive Director) 201 Sussex Street
- C Zhou ( Non-Executive Director) Sydney, NSW 1171
Company Secretaries Australia
- K Hogg (Australia) (effective 15 January 2013) Telephone: +61 2 8266 0000
- P B Kruger (South Africa)
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”):
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 Executive Vice President:
Technical Services 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 Ventersburg resource 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 Vice President: Exploration
for Gold One, with which he is a full-time employee, and has 26 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 14 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 and Cook 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.
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: 30/04/2013 07:07:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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