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GOLD RESOURCES – South Deep reserves shrink

SOUTH AFRICA - Vancouver's PLACER DOME reports that a review of resources at its 50%-owned South Deep mine (WESTERN...


SOUTH AFRICA – Vancouver’s PLACER DOME reports that a review of resources at its 50%-owned South Deep mine (WESTERN AREAS 50%) has revised the total downward by 50% for year-end 2005 purposes.

Placer Dome explained: “Three principal issues impacted the South Deep reported mineral reserves and resources. A new geological model was constructed, incorporating new data and adding additional geological controls and refinements. Regional pillars in the mine plan were redesigned and enlarged to reduce seismic risk and improve pillar stability, resulting in reduced areal extraction of the orebody. Lastly, optimization work resulted in long hole stoping being introduced into certain areas of the mine plan, which lowered the cut-off grade, leading to increased tonnages and lower average grades in these areas.”

The smaller mineral resource numbers are not expected to change the near-term mining plan. The Phase 1 mineral reserve, which is minable from current infrastructure, is largely unchanged. The greatest reduction in numbers occurred for the Phase 2 reserve, which under the current mining schedule, will not be brought into production for at least 20 years.

At the end of 2004, proven and probable reserves at South Deep stood at 110.8 million tonnes grading 7.8 g/t Au. The company has not yet released the revised figures.

On Monday, Feb. 2, BARRICK GOLD announced that it had increased its stake in Placer Dome to 94%. Under terms of the takeover agreement, Barrick will proceed with compulsory acquisition of the remaining 25 million outstanding Placer shares within the next 30 days. More information is available at www.Barrick.com.


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