Sunrise Dam Mine

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The Sunrise Dam Gold Mine is located 55 km south of Laverton, Western Australia. It is fully owned by AngloGold Ashanti. In 2007, it accounted for 11% of the company's production.

The mine is currently the company's only Australian operation. A second Australian project, the Tropicana Gold Mine, is in development and scheduled to open in 2013.

The gold deposit at Sunrise Dam was discovered in August 1988 and gold mining operations started in 1995, mining ore in an open pit, the Mega Pit, which, in 2008, had reached a depth of 440 metres. In March 1997, the first gold was poured at the mine. In 1999, AngloGold acquired the mine through a takeover of Acacia Resources Ltd, a move that also gained it a 33 % stake in the Boddington project, which it sold in early 2009 for $1.5 billion. Acacia, formerly Billiton PLC, was delisted from the Australian Stock Market on 11 January 2000.

In 2003, underground operations commenced.

In 2006, AngloGold signed a contract for conversion of its diesel power generators to liquefied natural gas as a cost-saving matter as well as to protect the environment.

In the June quarter of 2009, the mine produced 94,000 ounces of gold, a slight reduction to the previous quarter. At the same time, cost fell by 24 % due to the use of existing stockpiles.

During 2009, AngloGold discussed the option of processing ore from the Fortitude deposit, 36 km south of Sunrise Dam and owned by Midas Resources, at the mine.

The majority of the mine workers are on a fly-in fly-out roster, with Skippers Aviation providing a charter service twice-daily from Monday to Friday.

Past production figures were:

Year Production Grade Cost per ounce
2000 309,000 ounces 3.87 g/t A$ 309
2001 297,000 ounces 4.12 g/t A$ 311
2002 382,000 ounces 3.49 g/t A$ 312
2003 358,000 ounces 3.12 g/t US$ 228
2004 410,000 ounces 3.46 g/t US$ 260
2005 455,000 ounces 3.68 g/t US$ 269
2006 465,000 ounces 3.39 g/t US$ 298
2007 600,000 ounces 4.86 g/t US$ 306
2008 433,000 ounces 3.46 g/t US$ 531
2009 401,000 ounces 2.87 g/t US$ 646

Sunrise Dam

Description: Sunrise Dam is located some 220 kilometres north-north-east of Kalgoorlie and 55 kilometres south of Laverton. The mine comprises a large open-pit operation and an underground project. Mining is carried out by contractors and ore is treated in a conventional gravity and leach process plant.

Geology:

Gold ore at Sunrise Dam is structurally and lithologically controlled within gently dipping high-strain shear zones (for example, Sunrise Shear) and steeply dipping brittle-ductile low-strain shear zones (for example, Western Shear). Host rocks include andesitic volcanic rocks, volcanogenic sediments and magnetic shales.

Operating review

Production increased slightly at Sunrise Dam in 2006 to a record 465,000 ounces. This was primarily because of the operation’s highest-ever quarterly production of 153,000 ounces in the final quarter, when mining concentrated, as planned, on the high-grade GQ lode in the open pit. Mining from the known underground reserves increased significantly, especially in the Sunrise and Western Shear zones. Gold production from the underground mine was 67,000 ounces. Record throughput was achieved in the process plant as a result of additional crushing and grinding circuit optimisation.

Total cash costs rose to $298 per ounce, primarily as a result of increased costs associated with diesel fuel and mining contractor rates, while gross profit adjusted for the effect of the loss on unrealised non-hedge derivatives and other commodity contracts rose significantly year-on-year to $137 million as a consequence of the higher price received.

Progress continued on the Sunrise Dam underground project, with 2,305 metres of underground capital development and 5,901 metres of operational development having been completed during the year.

Capital expenditure amounted to $24 million compared with $34 million in 2005.

Growth prospects
The underground mining project involves the development of two declines and 125,000 metres of drilling from surface and underground. These declines have been developed in the vicinity of defined underground reserves, which are now being mined. They have also provided access for underground exploration drilling.

Underground resources have increased to 1.5 million ounces. The mineralisation is complex, varying in orientation, width and grade, although mining of the known reserves has provided valuable operating experience and prospectivity remains high. Underground exploration is planned to continue in 2007.

Outlook

In 2007, gold production is expected to be about 580,000 ounces as mining of the open pit will continue in the high-grade GQ lode for the year. Production will be supplemented by approximately 85,000 ounces from the underground operation.

Total cash costs of around $266 per ounce are expected. Capital expenditure is forecast to increase to $34 million, which is to be spent primarily on the maintenance of infrastructure and underground development.

Reference for information:
www.anglogold.co.za/subwebs/informationforinvestors/Ann...

Reference for location:
bonzle.com/c/a?a=p&p=2261&c=3&x=122%2E472337818119&y=%2...