Leonora

Development

The Gwalia gold mine has one of the longest operating histories and largest gold production records in Australia. It is a world-class ore body with historical production and current resources exceeding 3.5 million ounces of gold.

The Board approved the development and mining of Gwalia in February 2007 based on a detailed feasibility study completed in December 2006.

The Gwalia mine is on schedule to commence production in the September quarter 2008. Targeted gold production for the 2009 financial year from Leonora is in the range of 115,000 – 125,000 ounces including expected production from the Trump and Kailis open pit deposits. The Gwalia mine is currently expected to increase production to an annual rate in excess of 200,000 ounces from 2011.

Total Ore Reserves at Gwalia as at 31 June 2007 were 1.7 million ounces, representing an approximate mine life of 8 years.

Tower Hill

The addition of open pit ore to the Gwalia mill will significantly reduce the unit cost of A$29 per tonne milling and administration charge used in the Gwalia feasibility study, and increase cash flow. Tower Hill, which is two kilometres from the Gwalia plant, has been identified as a potential open pit and/or underground opportunity and recent good results have seen a pre-feasibility study accelerated to consider the development options. Kailis, which was previously mined in the 1990s, 10 kilometres north of Gwalia, and several other targets are also being re-evaluated as potential sources of open pit ore.

Underground Development

At the end of May 2008, the Hoover Decline reached a vertical depth of more than 1020 metres below surface and was along side the ore reserves. This will allow development for mining to commence with the intention of starting gold production in the September 2008 quarter. Mining will be within the depth interval of 1,030 metres below surface to 1,640 metres below surface. Ground conditions remained favourable with little sign of increasing stress with increased depth. Gwalia underground ore production is scheduled initially at a run rate of 500,000 - 600,000 tonnes per annum in the March 2009 quarter.

Surface Development

The development of the 820 metre deep, 5.5 metre diameter Main Ventilation Shaft began in the June 2007 quarter and was completed during the March 2008 quarter.

Other surface infrastructure needed for the mine includes a refrigeration plant for cooling underground air temperatures to levels suitable for a healthy environment, and a paste fill plant. Supporting the whole operation requires a new gas- fired power generation facility and a substantial upgrade to the accommodation facilities at Leonora. Refurbishment of the Gwalia treatment plant has commenced and, when completed, the plant will have a capacity of approximately 1.2 million tonnes per year of hard rock and up to 1.8 million tonnes per year, when softer open pit material is blended.

Map of Operations