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Gold Fields cuts minimum required mine output

Gold Fields’ South
Deep twin shafts
at dusk
Johannesburg, South Africa — MININGREVIEW.COM — 01 October 2008 – Gold Fields Limited – Africa’s second- largest gold producer – has cut the minimum output it demands before investing in new mines by a substantial 60%, as larger and safer deposits become more difficult to find.

Revealing this development in its newly-published annual report, the company said that in future it would consider deposits as small as 2 million ounces that yield about 200 000 ounces a year. Bloomberg News quotes the report as saying this is well below half of the current level of 5 million-ounce deposits yielding 500 000 ounces. “There are ‘very few’ large deposits today,” the report added.

“We would be prepared to consider projects with a higher risk profile in return for superior returns,” Gold Fields said. “The company will consider building mines on deposits containing gold and other commodities and, in ‘exceptional’ cases, on sites that don’t contain gold,” it added.

Gold Fields CEO Nick Holland plans to boost gold production from last year’s 3.64 million ounces to more than 5 million ounces in three to four years’ time. “I will take Gold Fields into areas with ‘potentially higher political risk’ to increase output,” continued.

“Gold Fields aims to produce about 1 million ounces a year each from South America, West Africa and Australasia, and 2.3 million ounces from the South African region, in the next three to four years,” said Holland. This figure replaces previous CEO Ian Cockerill’s 2003 target of adding 1.5 million ounces a year to global production by 2009.