HomeGoldGold Fields suspends certain operations for rehabilitation

Gold Fields suspends certain operations for rehabilitation

Number Four shaft
at Gold Fields’
Kloof gold mine
Johannesburg, South Africa — MININGREVIEW.COM — 04 August 2008 – In line with its new safety culture, Gold Fields Limited – one of the world’s largest unhedged gold producers – is suspending the operation of the main shaft infrastructure at its Kloof gold mine for six months while necessary maintenance is carried out. Driefontein and South Deep will also be affected.

Making this announcement as the company’s results for the fourth quarter of fiscal 2008 were released here, CEO Nick Holland said: “A comprehensive review of infrastructure across our operations, following from the heightened safety awareness across the Group since my appointment, has resulted in urgent rehabilitation being necessary at the main shaft infrastructure at Kloof – and in particular replacement of a significant portion of the steelwork below 17 level. As a consequence, the operation of this shaft is to be suspended for approximately six months while the necessary maintenance is carried out,” he added.

“Kloof’s production over this period is expected to reduce by between 25 and 35%. Operations will continue at this shaft on a one-day-a-week basis to maintain integrity of faces and ore passes,” said Holland.

He went on to say that Driefontein’s production would also decline in the September quarter by approximately 400 kg due to a need to catch up safety-critical secondary support, and that South Deep was already in the process of re-installing primary support at its 95 2 West and 95 3 West ramps.

“Production at Driefontein and South Deep should return to approximately 6 800kg per quarter and 1 500kg per quarter respectively by the December quarter,” Holland revealed, “and Kloof’s production should be restored to 2 000 kg per month by February 2009.”

The newly-published Gold Fields results for the fourth quarter showed the following salient features:

  • Attributable gold production increased by 5% to 865 000 oz;
  • Total cash costs were steady at US$502 /oz;
  • Notional Cash Expenditure (operating cost plus capital expenditure) stood at US$869/oz due to high inward investment in growth projects;
  • Operating profit increased 6 % to R2.72 billion, and normalised earnings of R911 million were generated;

Looking at fiscal 2008 as a whole, attributable gold production amounted to 3.64 million oz, compared with 3.97 million oz in the previous year. Total cash costs increased from US$374/oz to US$476 /oz, due to the lower production and cost pressures driven by the resource boom;

The results statement added that final dividend number 69 of 120 SA cents per share was payable on 25 August 2008, giving a total dividend for financial 2008 of 185 SA cents per share.