Mineral Resources and Reserves

Underground mineral reserves reflect milled tonnages at recovered grades. Surface mineral reserves are in-situ tonnages at the grade reporting to the mill.

The evaluation method is generally ordinary kriging with mining block sizes ranging from 20*20m 2 to 100*100m 2 . The thickness varies from 1m to 2,5m. Inverse distance is used in a few instances and withsimilar block sizes. The Sichel-t estimator is often applied in gold exploration projects.

Gold prices of US$300/oz and US$315/oz were utilised for Avgold Limited’s Target and ETC mines respectively. The mineral resources of these properties are reported at cut-off grades ranging from 2,0g/t to 3,0g/t. For Nkomati a cut-off grade of 0,3% nickel or higher was applied. The mineral resources and reserves for the remaining commodities are reported at current contract grades or at guaranteed minimum grades, whichever is relevant.

The competent person with overall responsibility for the compilation of the mineral reserves and resources is Dr F A Camisani-Calzolari, PrScNat. He is employed by Avmin.

The following competent persons were involved in the calculation of mineral resources and reserves. They are employed by Avmin or its subsidiaries, unless otherwise stated: Most of the competent persons are members of either SACNASP, ECSA or PLATO and have in excess of five years’ experience relevant to the style of mineralisation and type of deposits under consideration. Snowden Mining Industry Consultants and Steffen Robbertson and Kirsten (SRK) have audited the resources and reserves of some operations. Maps, plans and reports supporting resources and reserves are available for inspection at Avmin’s registered office and at the relevant mines.

Definitions
The definitions of mineral resources and reserves, quoted from the SAMREC Code, are as follows:

A ‘mineral resource’ is a concentration [or occurrence] of material of economic interest in or on the earth’s crust in such form, quality or quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, continuity and other geological characteristics of a mineral resource are known, estimated from specificgeological evidence and knowledge, or interpreted from a well constrained and portrayed geological model. Mineral resources are subdivided, in order of increasing confidence in respect of geoscientific evidence, into inferred, indicated and measured categories.

 An ‘inferred mineral resource’ is that part of a mineral resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that may be limited or of uncertain quality andreliability.

An ‘indicated mineral resource’ is that part of a mineral resource for which tonnage, densities, shape, physical characteristics, grade and mineralcontent can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed.

 A ‘measured mineral resource’ is that part of a mineral resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and grade continuity.

A ’mineral reserve’ is the economically mineable material derived from a measured and/or indicated mineral resource. It is inclusive of diluting materials and allows for losses that may occur when the material is mined. Appropriate assessments, which may include feasibility studies, have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction is reasonably justified. Mineral reserves are subdivided in order of increasing confidence into probable mineral reserves and proved mineral reserves. 

A ‘probable mineral reserve’ is the economically mineable material derived from a measured and/or indicated mineral resource. It is estimated with a lower level of confidence than a proved mineral resource. It is inclusive of diluting materials and allows for losses that may occur when the material is mined. Appropriate assessments, which may include feasibility studies, have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction is reasonably justified.

 A ‘proved mineral reserve’ is the economically mineable material derived from a measured mineral resource. It is estimated with a high level of confidence. It is inclusive of diluting materials and allows for losses that may occur when the material is mined. Appropriate assessments, which may include feasibility studies, have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction is reasonably justified.

F A Camisani-Calzolari
28 September 2001

Note: Resources and reserves are quoted in metric tons.
Mn – manganese
Fe – iron
Cr2O3 – chrome oxide
FeO – iron oxide

Note: Resources and reserves are quoted in metric tons.
Au – gold
Co – cobalt
Cu – copper
Ni – nickel
Pt – platinum
Pd – palladium
Cr 2O3 – chrome oxide