GLOBAL MINE PRODUCTION

1	Barrick Gold – 32 million ounces (Moz)
2	Newmont Mining – 5.27Moz
3	AngloGold Ashanti – 3.76Moz
4	Kinross Gold – 2.67Moz
5	Goldcorp: – 2.57Moz
6	Newcrest Mining – 2.38Moz
7	PJSC Polyus – 2.16Moz
8	Gold Fields – 2.16Moz
9	Agnico Eagle Mines – 1.71Moz
10	Freeport McMoran – ١.٤٣Moz

“The environment during the first three months of 2018 was more varied: a relatively stable

gold price and rising interest rates contrasted with sharp equity market volatility and periods of heightened geopolitical risk to create mixed signals for gold investors,” stated the World Gold Council.

Central banks added 116t to global official reserves in Q1 2018, a 42 per cent increase y-o-y. This was the highest Q1 total for four years and in line with average quarterly purchases since Q1 2010 of 115t.

Russia, Turkey and Kazakhstan again dominated the list of central banks buying gold, adding 91t between them.

Demand for gold in the technology sector continued to improve, up 4% on Q1 last year. The wireless sector was a key area of growth as 3D sensors for facial recognition were increasingly deployed in smartphones, gaming consoles and security systems.

Global gold production continues to be dominated by the world’s top 10 largest gold producing companies in 2018.

Two years ago, annual global production hit its seventh consecutive all-time high, nearly doubling the levels of the late 1980s. But 2017 saw a 5 tonne, or 0.1 per cent dip, to a total 3,427 tonnes – a first annual drop since 2008 (GFMS).

This fall was predominantly driven by environmental concerns in China and, as reported by GSM, a crackdown on illegal mining in Indonesia, Peru and Colombia. This led to a drop in output year-on-year.

Russian production, however, showed the standout gain at the global level, supported by a ramp-up at Olimpiada, while production in the United States rose by eight tonnes supported by new projects and higher grades at two key operations (GFMS).

Mining costs rose last year on a Total Cash Cost basis by 4 per cent to an average of $672/oz, while All-in-Sustaining Costs (AISC) increased by 5 per cent to $878/oz (GFMS). Most producers faced headwinds led by higher fuel costs, lower grades and mixed changes across producer currencies.

GFMS anticipates that mine production will post year-on-year gains in 2018 to a “new record high of 3,265 tonnes”, with Asian countries such as China, Indonesia and Mongolia contributing gains, with Australia, Russia and Canada adding to the mix.

The US, South Africa and Tanzania, on the other hand, are expected to show strong declines year-on-year.

GOING GREEN – FUTURE OF GOLD MINING

Barrick Gold remains the world’s biggest gold producer. Barrick Gold’s Hemlo mine. Image courtesy of Barrick

Mine production 2017 vs 2016. Source: GFMS, Thomson Reuters

Historically, the image of mining was not synonymous with clean, green nor particularly socially constructive. And so, despite the significant contribution to the world’s economy, the mining sector’s reputation remained tainted in many countries due to perceptions that mining companies engage in dubious practices in developing countries, cause a negative impact on local communities and have an adverse effect on the environment.

Mounting social and investor pressure to become responsible corporate citizens is forcing environmental, social and governance issues to rise up the corporate agenda of many companies.

“As the mining industry’s value proposition is increasingly called into question, mining companies are beginning to see that they cannot succeed into the future unless they change the way they operate. This is about more than enhancing efficiencies. It’s about re-establishing trust with stakeholders and collaborating to devise better responses,” said Glenn Ives, Chair Deloitte Canada.

In paving new paths for the future, most mining companies now aim to change for the better. This goal is driving their ongoing investments in innovation, digitisation, and adoption of transformative practices.

Borden electric underground mining vehicle

“It is no longer good enough for companies in our industry to see themselves as simply mining businesses that produce gold and generate returns for their investors,” wrote Brent Bergeron, Executive Vice President Corporate Affairs and Sustainability Goldcorp, in World Gold Council’s Gold 2048: The next 30 years for gold essay series. “Instead, we need to step back and consider how we will work in partnership with governments and all our stakeholders to deliver both social and financial benefits to society.”

Despite differing geographical, operational and regulatory challenges, a number of gold mining companies are working towards a cleaner and more sustainable operations.

Goldcorp’s Borden mine in Ontario, Canada, is set to become the world’s first all-electric underground mine by replacing current diesel-fuelled mobile equipment with Battery Electric Vehicles (BEVs).

On the other side of the globe, Newmont Mining’s Australian operations strive to improve efficient energy targets by increasing renewable energy supply through purchase agreements or self-generation as well as transitioning to electric or hybrid vehicles.

Additionally, in 2009, Newmont began a forestry carbon offset project, planting a total of 800,000 mallee tree seedlings in New South Wales and Western Australia. The trees are expected to capture about 300,000 tonnes of carbon over a 30-50-year period supporting the Clean Energy Act. The trees also improve the salinity of the soils and increase biodiversity in the area. The trees are a part of the Carbon Farming Initiative, launched by the Australian government in 2011.

Last year, IAMGOLD’s subsidiary, IAMGOLD Essakane SA, partnered with Total Eren, AREN ENERGY (PTY) Ltd and Essakane Solar SAS to develop a 15 MWp solar power plant for the company’s Essakane mine in Burkina Faso.

Lauded as the largest hybrid plant in Africa, the project aims to reduce the mine’s fuel consumption by approximately six million litres of diesel per year and lower its annual CO2 emissions by around 18,500 tonnes. As part of an ambitious local development policy, the project will create 40 new operational jobs and devote a percentage of its revenues to local development.

“Hybrid power systems enable energy intensive industries, such as mines, to reduce fuel consumption, decrease energy costs, protect against fuel price volatility, as well as improve their social and environmental footprint by cutting greenhouse gas emissions and boosting local employment,” commented President and CEO of IAMGOLD Steve Letwin.

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World Gold Council launches climate change report

The World Gold Council launched its Gold and climate change report, aiming to provide investors with greater clarity around gold’s impacts on climate change.

Marking one year since the recommendations from the Taskforce on Climate-Related Financial Disclosure (TCFD), the report is an initial step to build understanding of the gold industry’s greenhouse gas emissions (GHG) footprint, the efforts already underway to reduce emissions and gold’s role in improving energy efficiency and developing low carbon technologies.

Acknowledging that limited data currently exists, the report makes a number of key findings including the total volume of carbon emissions for global gold production being significantly smaller than most other major mined products, including steel, aluminium and coal.

The report also recognises that gold itself may also play an important role in technologies that help facilitate the transition to a low carbon economy through the use of, amongst other things, gold nanomaterials to enhance hydrogen fuel cell performance and the inclusion of gold to improve photovoltaics and how the sun’s energy is captured and utilised

Examples of current best practice are used in the report to highlight the gold mining industry’s shift towards operational changes to reduce GHG emissions and improve energy efficiency, including the design and construction of the world’s first all-electric mine.

“Given gold’s growing role as a strategic investment asset, the need for greater awareness of its climate-related impacts is a priority issue for many investors. Our initial findings, based on the limited research, help investors in better understanding gold’s greenhouse gas emissions profile and gold’s role as part of a diversified portfolio,” said Terry Heymann, Chief Financial Officer at the World Gold Council.

The report’s findings were reviewed by environmental scientists at the Centre of Environmental Policy (CEP) at Imperial College London.

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Impact to ramp up exploration across its portfolio

Exploration work will be ramped up over the next six months at four of Impact Minerals 100 per cent owned gold and base metal projects across Australia.

Impact drilling at Commonwealth project

Follow up drill programmes are planned for the Commonwealth gold-silver base metal project in New South Wales, the Clermont gold project in Queensland and the Mulga Tank gold and nickel project in Western Australia. Additionally, the first bulk samples will be taken at the Blackridge conglomerate gold project in Queensland in which Impact recently acquired an option to earn 95 per cent.

Work will commence at Commonwealth and Clermont with drill rigs likely to be operating concurrently before moving on to Mulga Tank and Blackridge by approximately September/ October of this year.

OVERVIEW OF THE PROGRAMME

At Commonwealth, all statutory approvals are in place to commence follow up drilling at the Silica Hill Prospect where gold and very high-grade silver intercepts were returned from the previous drill programme.

Step out diamond drill holes are planned to test the down dip and down plunge extensions of the mineralisation.

At Clermont follow up RC and diamond drilling are planned at five targets to test previous high-grade drill intercepts and rock chip and soil geochemistry anomalies.

The mineralisation style at Clermont indicates strong similarities to the high-grade, low sulphidation-style Pajingo gold deposit located 250 km to the northwest with total

resources of >5 million ounces at gold grades between 10 g/t and 17 g/t.

The Clermont drill programme will commence on completion of Land Access Agreement negotiations which are ongoing.

At Mulga Tank in Western Australia, Impact has identified a significant number of gold and nickel targets for follow up work. The project comprises 20 strike kilometres of Archaean greenstone belt 200 km north east of Kalgoorlie and is highly prospective for Tier 1 gold deposits such as Gruyere located 200 km to the north east with current resources of 3.8 million ounces at 1.2 g/t nickel as well as komatiite and dunite-hosted nickel deposits.

The top three gold and top two nickel targets will be tested by a programme of aircore drilling which will commence on the availability of an appropriate drill rig.

At the Blackridge conglomerate gold project also located near Clermont in Queensland, bulk samples will be taken at several places along the mineralised unconformity between the gold-bearing sedimentary units and the underlying basement. A few drill holes may also be completed. A review of appropriate sampling methodologies and equipment

is underway. This work will commence on completion of a number of statutory agreements which are expected to be completed early in Quarter 4 2018.

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Kalamazoo braces for a gold bonanza

Kalamazoo Resources signalled its further push into the gold space by announcing that it had exercised its option to acquire equity in three highly prospective gold projects in Western Australia (WA) as well as being granted and exploration covering the Wattle Gully Gold Project in Victoria, Australia.

A portion of the-extensive core-farm at the Wattle Gully Gold Project

DOMs Hill Prospect looking south

Since listing on the ASX in early 2017, the Australian gold and base metals explorer and developer has been continually investigating the acquisition of assets with inherent potential that can be exploited by advanced exploration and development technologies.

Following this strategy, Kalamazoo identified the highly prospective Bendigo Zone in Victoria as the focus for securing an extensive and promising tenement position, as well as making a push for an 80-100 per cent equity in Pilbara’s minerals rich region. The tenements – previously owned by companies associated with WA resources industry stalwarts, Denis O’Meara and Brett Keillor – have the potential to host significant gold mineralisation.

Victoria

The granted Exploration Licence EL006679 covers the Wattle Gully Gold Project, near the town of Castlemaine, in Victoria. In addition, Kalamazoo has made a further exploration licence application EL006752, to the east and south of the granted tenement, covering regional geological structures known to be associated with gold potential.

Granted Exploration Licence 006679 (“Wattle Gully”) lies immediately east and south of the town of Castlemaine and covers almost the entire historic Castlemaine Goldfield with a total area of 70km2. An application for a second Exploration Licence 006752 (“Wattle Gully South”), covers an area of 218km2, thus taking the total tenement holding (once granted) to 288km2.

“Our project generation team identified an opportunity to secure the Castlemaine Project at minimal cost. Concurrently, our due diligence and technical assessment has confirmed our belief in the project’s significant potential,” said Kalamazoo’s Managing Director, Peter Benjamin.

What attracted Kalamazoo to the Castlemaine Goldfield was it being the third largest gold field in Victoria, producing an estimated 5.6Moz of gold.

“In particular, the Wattle Gully Gold Mine had our interest, as it produced 411,000oz of gold, from underground mining from 1.1Mt, at a very attractive, recovered grade in excess of 11g/t Au, during the period between 1934 and 1969,” said Mr Benjamin. “Other underground operations in the area produced approximately another 700,000ozs, across up to four known lines of reef, which were mined to a maximum depth of approximately 400 metres.”

Wattle Gully adds a significant gold project to Kalamazoo’s portfolio, at an extremely low cost. The asset is in a supportive mining region which is becoming increasingly active with significant exploration and development success across multiple projects including Fosterville, Tandarra and Costerfield.

Strategically, the Castlemaine region is well supported with a number of gold processing plants within 80km haulage distance of the Wattle Gully Gold Project.

Western Australia

DOM’s Hill Gold Project (E45/4722, E45/4887 and ELA45/4919)

The DOM’s Hill Gold Project now consists of two granted exploration licenses and two exploration license applications located 110km south east of Port Hedland within the Archaean East Pilbara Region. The project overlies the Warralong, Doolena Gap and Marble Bar Greenstone belts as well as the unconformably overlying Gorge Range Group, the younger Lallah Rookh Synclinorium and the overlying Fortescue Group. The tenements cover the major domain bounding Gorge Range, Muccan South and Bamboo Creek Shear Zones as well as numerous second order shear zones including the Dom’s Hill Shear Zone and the North-East Fault.

Tenement location of Wattle Gully (granted) and Wattle Gully South (application)

The project is considered prospective for a range of gold, nickel, cobalt and base metal deposits. Past exploration has highlighted the potential for shear hosted lode gold mineralisation with a number of advanced targets within the project including DOMs Hill and the North-East Zone.

Within E45/4722 tenement and approximately 500m to the north east of the DOM’s Hill Gold Prospect is the Singer Prospect. Great Sandy has located gold mineralisation in proximity to an interpreted north-east trending fault zone within a chert, mafic and ultramafic sequence. Great Sandy and prospectors have located up to 300ozs of gold nuggets in this zone. No historic drilling has adequately tested this prospect. Assessment of this, and other areas known to shed significant gold nuggets, will be the focus of future exploration.

At the NorthEast Zone Prospect, located 4.5km east of the Doms Hill Prospect, gold mineralisation is associated with a north-east trending shear zone within a mafic and ultramafic sequence.

The DOM’s Hill Gold Project contains an array of exploration targets ranging from advanced prospects with significant gold grade intersections through to grass roots conceptual targets.

The Sisters Gold Project (80% interest in non-lithium rights E47/2983)

The Sisters Gold Project lies within a larger area currently undergoing significant gold exploration by Novo Resources and De Grey Mining, DGO Gold, Coziron Resources, Arrow Minerals, Venturex Resources and others.

The Project contains the north-east trending Mt Wohler Shear, a major splay from the gold mineralised Mallina Shear to the north. There is no reported systematic exploration along this prospective shear. The Project is underlain by folded and faulted siliciclastics, volcanoclastics and mafic sills of the Mallina Basin, which is part of the De Grey Supergroup (3020 to 2930Ma).

Following the re-sampling of soil samples initially collected by Sayona Mining for lithium exploration, Kalamazoo announced a gold-in-soil anomaly defined over 3km along the Wohler Shear Zone corridor and open to the north-east and south-west. This highly encouraging development resulted in Kalamazoo immediately undertaking a follow up dedicated program to determine the optimum soil fraction for detecting an expanded gold anomalism.

The Sisters Gold Project is partly underlain by Mallina Formation sediments, host to recent nugget discoveries by Arrow Minerals in the immediately adjacent E47/3476.

Locations of Sisters, DOMs Hill, Marble Bar Gold and Yule Project Tenements

Marble Bar Gold Project (100% interest in non-lithium mineral rights over EL45/4724)

The tenement straddles the western intrusive contact of the Archaean Mt Edgar Batholith and the adjacent basalts, amphibolites and ultramafic units of the Warrawoona Formation. Major northerly trending arcuate regional structures traverse the project.

There is now strong recognition by the exploration community that the Warrawoona greenstone belt in the Marble Bar area has the potential to host significant gold resources.

Kalamazoo’s review of the data for the Marble Bar tenement indicates it contains a sheared meridional greenstone belt which apparently has never been explored for gold despite the large number of small gold leases throughout the larger area.

“We now have the opportunity to cost effectively add modern exploration techniques through our upcoming work programs. This will enhance our understanding of the structural controls of mineralisation that are critical to drill targeting and unlocking the true potential of this style of deposit,” said Mr Benjamin.

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Nusantara delivers maiden 1.0 moz gold ore reserve

Awak Mas camp from North view

The Asia‐Pacific gold development company Nusantara Resources has announced a maiden Ore Reserve of 1.0 million ounces contained gold for its 100 per cent‐owned Awak Mas Gold Project located in South Sulawesi, Indonesia.

The Ore Reserve supports a long-life, low cost gold operation at a 2.5 Mtpa processing rate, with a low strip ratio of 3.5 and good access to established power and transport infrastructure.

The Awak Mas Gold Project Probable Reserve – at 0.5 g/t Au cut‐off using a US$1250/oz gold price – is 23.7 Mt at 1.35 g/t Au for 1,030,000 contained ounces. The Ore Reserve estimate is based on the Mineral Resource estimate reported for the Awak Mas and Salu Bulo deposits in January 2018 and February 2018 respectively, and work completed in the first stage of the Definitive Feasibility Study (DFS).

“Our maiden Ore Reserve represents a significant milestone for the Company and now places Nusantara among an elite group of ASX-listed gold development companies”, commented Nusantara’s Managing Director and CEO, Mike Spreadborough. “This Ore Reserve combined with the exploration potential of the project demonstrates the value of a proposed long-life, low cost, stand-alone gold project at Awak Mas.”

Background

The Awak Mas gold deposit, located in Sulawesi was discovered in 1988. Since that time, a number of owners have undertaken drilling and technical studies within the 14,390ha Contact of Work (CoW). This work has led to the definition of Mineral Resources at the Awak Mas, Salu Bulo and Tarra deposits – collectively, the Awak Mas Gold Project – and completion of Pre-feasibility Studies (PFS). The project has been granted all environmental and construction approvals for continued development.

In 2017, Nusantara Resources became owners of the Project from One Asia Resources through an ASX IPO. Nusantara has undertaken further resource definition drilling, metallurgical evaluation, and mining studies targeted for the completion of a Definitive Feasibility Study (DFS) by July 2018.

The Project is 100 per cent-owned through a 7th Generation CoW with the Government of Indonesia (GoI). The CoW was secured prior to the current Mining Law and has recently been amended by mutual agreement to align with the current law.

PT Masmindo Dwi Area (Masmindo), a wholly owned subsidiary of Nusantara, has sole rights to explore and exploit any mineral deposits within the project area until 2050. After this period, the operations under the CoW may be extended in the form of a special mining business license (IUPK) in accordance with prevailing laws and regulations, which currently allows for an extension of 10 years and a further extension of 10 years.

In the 10th year after commercial production, Masmindo is required to offer at least 51 per cent of its share capital to willing Indonesian participants at fair market value according to international practice.

Awak Mas Site Layout showing the location of the three deposits: Awak Mas, Salu Bulo and Tarra

Geology and Mineral Resources

The Awak Mas, Salu Bulo and Tarra mineralised systems comprise a complex sequence of intercalated meta-sediments and intrusive rocks. A high level, low sulphidation hydrothermal system has developed which is overprinted by a strong sub-vertical fracture control which has channelled mineralising fluids.

The Project is an active growth project where recently completed diamond drilling by Nusantara has defined a 2.0 Moz Mineral Resource. The Awak Mas deposit currently contains an lndicated and Inferred Mineral Resource of 39 Mt at 1.37 g/t Au for 1.72 Moz utilising a lower cut-off grade of 0.5 g/t Au. The smaller satellite deposits of Salu Bulo (3.7 Mt at 1.53 g/t Au) and Tarra (2.3 Mt at 1.34 g/t Au) together contain additional Mineral Resources of 0.28 Moz of gold and are located 2.5 km east and 4.5 km to the north of the Awak Mas deposit respectively.

Tailings Storage Facility

Awak Mas to Salu Bulo – exploration model for future drill targeting

Process flowsheet

Golder Associates completed a preliminary geotechnical investigation, tailings characterisation and TSF design for the PFS for the Project in 2013 and is currently conducting a geotechnical investigation and seismic study to progress the design of the TSF for the DFS.

The hazard category for the TSF has been classified as Major, based on ANCOLD Guidelines, considering the Severity Level of Impacts and the failure Consequence Category. Accordingly, the containment embankment of the TSF must be designed and constructed as a fully engineered structure, taking into consideration the foundation conditions, site seismicity, available construction materials, tailings characteristics and the range of potential rainfall events.

The Kandeapi Valley, approximately 3 km east of the proposed process plant site, is considered to be most suitable location for the TSF. The proposed TSF embankment is aligned east-west across the Kandeapi Valley, with a saddle dam extension to the south-east.

A conventional downstream embankment configuration has been selected as most appropriate for this highly seismic environment. For the pre-feasibility study the design slopes adopted are 1:2.5 (V:H) downstream and 1:3 (V:H) upstream.

The required capacity of the TSF for the 10-year planned life of mine (LOM) is as follows: Tailings tonnage 25 Mt, Tailings volume 18 Mm³.

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Bluebird Merchant Ventures moves forward at Kochang

A new underground channel sampling program has been completed by Southern Gold’s development partner, Bluebird Merchant Ventures, at the Kochang Gold Project in South Korea.

Kochang Gold project location in the Republic of Korea

A total of 1,331 meters of vein was sampled at 5m intervals with 425 channel samples and 100 grab samples collected.

Best channel samples returned were 0.24m at 65.8g/t Au and 170 g/t Ag and 0.18m at 69.2 g/t Au and 80 g/t Ag from the 245 Level.

Hydrothermal quartz veining and brecciation was mapped and sampled over 700m strike length within old workings and sampling was conducted over 2 levels of the 4 main levels that comprise the historical workings.

Average grade along the 9 development drives from channels sampling was 5.9 g/t Au and 31 g/t Ag with average vein width of 0.42m.

Partially stoped panels were observed with in-situ stockpiles being sampled with best assays from grab samples of 17.4g/t Au and 165 g/t Ag and 13.5g/t Au and 36g/t Ag on the 245 Level.

Bluebird is currently investing a total of US$1 million in the advancement of the historic Gubong and Kochang Gold Mines and earning 50 per cent project equity principally by defining a development framework to advance the projects on a capital cost of less than US$10 million.

“We are very pleased to report the underground sampling results from the Kochang Gold Project which were completed by our development partner Bluebird Merchant Ventures. Bluebird has done a great job of confirming the scale and distribution of the mineralisation at Kochang and this work forms a very effective base from which to advance the project towards production,” said Managing Director, Mr Simon Mitchell.

“While there remains much work to be done before we get to that point, we are very pleased with the grade tenor, the consistent nature of the mineralisation along the drives and the fact the system is open in multiple directions. This all reinforces the economic potential of the project which will be the subject of further studies.”