Normandy Mining Limited: Q2 Report On Activities To Shareholders.Business Editors ADELAIDE, South Australia--(BUSINESS WIRE)--Jan 17, 2001 Normandy Mining (TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :NDY NDY Not Dead Yet NDY Not Done Yet .) Three Months to 31 December 2001 Strong gold production, 611,788ozs at $310/oz (US$159/oz) total cash cost. Corporate and operational enhancements add further value. PRODUCTION -- Gold production, 611,788 ounces - best half-year performance, 1,249,367 ounces - total cash cost, $310 per ounce (US$159/oz) - average realised price, $584 per ounce (US$299/oz) -- Golden Grove
lpm - lines per minute ), 39,885 tonnes (15,865t) - zinc concentrate Zinc concentrate is a highly hazardous product used in the production of zinc metal and zinc alloys, which is the result of a flotation process after the zinc ore has been mined and milled. , 28,199 tonnes (44,464t) DEVELOPMENT -- Groundrush commences ahead of schedule, under budget - Martabe (Sumatra), project feasibility to proceed -- high returns indicated, low entry capital and operating costs operating costs npl → gastos mpl operacionales EXPLORATION -- Jundee, Westside structure, exciting high grades intersected - including 5m at 3,288g/t (106oz/t*) -- Favona, new intersections upgrade shallow potential -- including 19m at 9.0g/t -- Golden Grove, new Zeewijk zinc zinc, metallic chemical element; symbol Zn; at. no. 30; at. wt. 65.38; m.p. 419.58°C;; b.p. 907°C;; sp. gr. 7.133 at 25°C;; valence +2. Zinc is a lustrous bluish-white metal. It is found in Group 12 of the periodic table. zone enhances value FINANCE -- Strong operating profit anticipated -- low debt maintained -- Hedge book reduced by more than 1.3 million ounces - policy amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. to reduce hedging - upside Upside The potential dollar amount by which the market or a stock could rise. Notes: This is basically an educated guess on how high a stock could go in the near future. See also: Bull, Downside participation 70% of Reserves CORPORATE -- Normandy Directors recommend Newmont takeover offer - AMC (Advanced Mezzanine Card) See AdvancedTCA. project funding Project Funding reflects the overall financial analysis and entails the analysis that is needed in order to get the financial means approved and funds made available to be able to perform the discipline of project management. successfully completed - Rationalisation Noun 1. rationalisation - (psychiatry) a defense mechanism by which your true motivation is concealed by explaining your actions and feelings in a way that is not threatening rationalization of non-core assets continues -- Ity and Tasiast sold for up to $33.3M consideration - Normandy NFM NFM Nebraska Furniture Mart NFM Network File Management NFM Network Fault Management NFM No Further Message NFM Near Field Monitor NFM National Firearms Museum (Fairfax, Virginia) NFM NATOPS Flight Manual NFM Northern Fowl Mite offer for Otter Gold Mines succeeds -- increased ownership of Favona -- consolidation of Tanami position NOTE: (1) Previous quarter figures italicised in brackets brackets: see punctuation. . (2) Australian dollar Noun 1. Australian dollar - the basic unit of money in Australia and Nauru dollar - the basic monetary unit in many countries; equal to 100 cents values used, with some key figures translated in US dollars at A$1.00 = US$0.5120. (3) * 't' = tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. PRODUCTION - robust Gold production - 611,788ozs at $310/oz Gold production was 611,788ozs at a total cash cost of $310/oz (US$159/oz). Increased output from Kalgoorlie Super Pit and new production from Ovacik and Groundrush was offset by lower production at Jundee, Mt Leyshon and Mt Charlotte. Production ceased at Boddington, as anticipated, while reserves at Mt Charlotte and Mt Leyshon are almost depleted de·plete tr.v. de·plet·ed, de·plet·ing, de·pletes To decrease the fullness of; use up or empty out. [Latin d . The average net realised gold price for the quarter was $548/oz, compared to the average spot price of $544/oz. Including the deferred hedge gain, the price achieved was $584/oz.
ATTRIBUTABLE PRODUCTION COST (unaudited)
GOLD INSTITUTE STANDARD
3 months 6 months
periods ended Dec. '01 Dec. '01
($/oz) ($/oz)
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Direct mining expenses 330 333
Stripping & mine development adjustments (5) (8)
By-product credits (24) (25)
Sundry expenditure (income) (3) (2)
Cash operating cost 298 298
Royalties 12 12
Total cash cost 310 310
Depreciation 35 37
Amortisation 66 68
Mine closure 7 7
Total production cost 424 425
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Tanami - Groundrush enters production ahead of schedule and under budget (Northern Territory, 87.45% at 30 September 2001) Gold production was a record 148,691ozs, including the initial contribution from Groundrush which commenced production in November, offsetting a lower average feed grade to The Granites treatment plant. Callie mine production was 426,921t at a head grade of 6.4g/t. Mining of the first secondary stope stope n. An excavation in the form of steps made by the mining of ore from steeply inclined or vertical veins. tr.v. stoped, stop·ing, stopes To remove (ore) from or mine by means of a stope. was completed and the second entered production in early January 2002. Trials of an underground road train demonstrated potential to improve haulage efficiency. The Villa pit was completed and Colliwobble is nearing completion. A cutback cut·back n. 1. A decrease; a curtailment: "The political effects of food cutbacks could be devastating" New York Times. 2. of the previously mined Dead Bullock bullock a mature castrated male cattle destined for meat production or draft. Ridge pit commenced. The Groundrush pit produced 19,858ozs at a total cash cost of $248/oz ($320/oz including start-up costs), with grade averaging 4.41g/t. Ore stockpiles are being established at the Tanami mill to ensure production continuity during the wet season. Pajingo - total cash cost 16% lower at $162/oz (Queensland, 50%) Gold production was 63,630ozs at $162/oz total cash cost, with average grade and mill throughput slightly higher. Recovery was marginally lower at 96.69%, the result of increased throughput after modifications to the crushing crushing deaths of newborn animals, especially those in litters, caused by the mother lying on them accidentally. Contributed to by weakness of the neonate or awkward accommodation. A problem in piglets and puppies. Called also overlying. circuit. Total mine movement was lower at 165,133t, reflecting the transition period to owner-mining. However, production rates have now surpassed those of the mining contractor and mining costs have fallen by 30%. In combination with scheduled production from higher grade stopes Stopes , Marie Carmichael 1880-1958. British social reformer who opened England's first birth control clinic (1924) in London and later promoted family planning in east Asia. , total cash cost of gold production is expected to decline for the remainder of the fiscal year. Development of the Vera South Deeps orebody is progressing and work has commenced on development of the high grade Jandam orebody. Jundee - gold production 88,079ozs (Western Australia Western Australia, state (1991 pop. 1,409,965), 975,920 sq mi (2,527,633 sq km), Australia, comprising the entire western part of the continent. It is bounded on the N, W, and S by the Indian Ocean. Perth is the capital. , 100%) Gold production was 88,079ozs, 12% below the previous quarter, at a total cash cost of $316/oz. Underground production rates were 21% lower, partly due to the changeover (programming) changeover - The time when a new system has been tested successfully and replaces the old system. of mining contractors. Mining commenced in Elliot pit, the operation's first satellite pit. Nim3 and Northwest pits contributed 45% of open pit ore tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. and Elliot Pit contributed 41%, with the remainder sourced from Moore and Lyons. Open pit ore production was 31% higher but overall grade was lower. Mill throughput was maintained at similar levels despite the increasing proportion of harder feed. Kalgoorlie - Super Pit production higher (Western Australia, 50%) Super Pit gold production and shipments rose 21% and 28% respectively after mill throughput, concentrate stocks treatment and gold recoveries were addressed comprehensively by management in response to the difficult September quarter. Ore grades Ore grade is a measure that describes the concentration of a valuable natural material (such as metals or minerals) in its surrounding ore. Ore grade is used to assess the economic feasibility of a mining operation: the cost of extracting a natural material from its ore is directly improved slightly although mining was again limited to lower grade zones in the Oroya and Paringa-Stores cutbacks. Productivity from the mining fleet continues to exceed expectations despite constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. around old workings. The Mt Charlotte mine was officially closed in December after continuous operation since the early 1960's. A small workforce remains for recovery of remnant ore.
GOLD PRODUCTION, COSTS & SALES
Three months ended Equity Ore Head Gold Total Cash
31 December 2001 Interest Treated Grade Produced(1) Cost
(%) ('000t) (g/t) (ozs) ($/oz)
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Boddington (WA) (44.44) 1,458.2 1.00 44,322 349
Bronzewing (WA) (100) 493.5 4.47 69,421 322
Ity (Cote d'Ivoire)(3,4) (51) 81.2 4.51 8,263 440
Jundee (WA) (100) 537.6 5.45 88,079 316
Kalgoorlie Super Pit (WA) (50) 2,811.4 1.99 148,849 429
Midas (Nevada, USA)(3,5) (100) 57.1 25.22 45,393 230
Mt Charlotte (WA) (50) 280.3 3.21 25,731 357
Mt Leyshon (Qld) (76.36) 436.1 0.90 8,982 413
Ovacik (Turkey)(3) (100) 73.5 12.70 26,414 271
Pajingo Operations (Qld) (50) 170.3 12.10 63,630 162
Tanami Operations (NT) (87.45) 835.3 5.75 148,691 289
TVX Normandy Americas(3) (49.9)
Paracatu (Brazil) (49) 4,567.8 0.43 46,970 389
Crixas (Brazil) (50) 182.9 8.11 45,257 217
La Coipa (Chile)(5) (50) 1,707.0 0.76 35,289 142
Musselwhite (Canada) (32) 311.5 6.17 59,261 380
New Britannia (Canada) (50) 187.9 5.30 29,870 379
Wiluna (WA) (100) 177.8 6.01 30,816 408
Waihi Operations (NZ)(5) (67.06) 330.2 3.46 32,240 203
ATTRIBUTABLE PRODUCTION 611,788 310
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Three months ended Total Prodn Gold Realised Total Hedged
31 December 2001 Cost Sold(2) Price Price
($/oz) (ozs) ($/oz) ($/oz)
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Boddington (WA) 353 22,664 553 705
Bronzewing (WA) 473 69,880 543 543
Ity (Cote d'Ivoire)(3,4) 505 4,044 548 548
Jundee (WA) 467 87,360 543 543
Kalgoorlie Super Pit (WA) 485 80,093 558 709
Midas (Nevada, USA)(3,5) 523 48,260 533 533
Mt Charlotte (WA) 357 12,865 552 704
Mt Leyshon (Qld) 559 6,671 458 458
Ovacik (Turkey)(3) 338 27,238 554 554
Pajingo Operations (Qld) 240 31,815 553 704
Tanami Operations (NT) 343 129,581 555 555
TVX Normandy Americas(3)
Paracatu (Brazil) 428 11,130 545 545
Crixas (Brazil) 335 10,532 546 546
La Coipa (Chile)(5) 548 8,383 544 544
Musselwhite (Canada) 479 9,083 542 542
New Britannia (Canada) 542 5,453 557 557
Wiluna (WA) 549 31,689 543 543
Waihi Operations (NZ)(5) 369 23,562 561 561
ATTRIBUTABLE PRODUCTION 424 620,303 548 584
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(1) 100 percent for each operation. (2) Normandy share for each operation. (3) US$ costs converted at exchange rate for December 2001 quarter of $0.5120 (September 2001 quarter, $0.5056). (4) Tonnes stacked Stacked is an American television sitcom that premiered on Fox on April 13, 2005. On May 18, 2006, Stacked was cancelled, leaving five episodes unaired in the United States. The last episode aired on January 11, 2006. on heaps, not under irrigation irrigation, in agriculture, artificial watering of the land. Although used chiefly in regions with annual rainfall of less than 20 in. (51 cm), it is also used in wetter areas to grow certain crops, e.g., rice. . (5) Martha, Midas and La Coipa are reported using by-product by·prod·uct or by-prod·uct n. 1. Something produced in the making of something else. 2. A secondary result; a side effect. by-product Noun 1. accounting, with silver revenues credited in calculating total cash cost per ounce. Average silver grade was 43g/t for Martha (202,684ozs), 360g/t for Midas (603,377ozs) and 87g/t for La Coipa (3,037,487ozs). If silver production was reported as gold equivalent, gold total cash cost and production would be $154/oz (42,271ozs), $286/oz (54,174ozs) and $392/oz (81,788ozs) respectively. Ovacik - continued strong performance (Turkey, 100%) Ovacik continued to build on the strong performance of last quarter. Gold production increased by 36% to 26,414ozs, reflecting higher head grades and further improvement in recovery efficiency. Total cash cost fell 17% to $271/oz. Mill feed was sourced entirely from the open pit ('S Vein' 70% and 'M Vein' 30%). Underground operations Underground Operations is a Toronto-based independent punk rock record label. Operated by Mark Spicoluk, former Closet Monster member, this label is one of the most cutting edge independent labels in Canada. focused on recruitment and training of new mining crews, continuation of development of the Edip Duru Decline and lateral development (121m). Environmental compliance continued, with all strict obligations met. Waihi - lower total cash cost (New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. , 67.06% at 30 September 2001) An increase in grade and a marginal improvement in recovery maintained gold production at levels similar to the previous quarter despite lower mill throughput. Total cash cost was 7% lower at $203/oz, continuing the positive improvement in performance. Although grades next quarter are scheduled to decline, cash costs are expected to remain below $240/oz. Total mine movement decreased by 21%, attributed to a lower pit strip ratio as the cutback progresses. Production was also restricted in December by a subsidence subsidence, lowering of a portion of the earth's crust. The subsidence of land areas over time has resulted in submergence by shallow seas (see oceans). Land subsidence can occur naturally or through human activity. event (in an area adjacent to the open pit and outside the Mining Licence) when workings collapsed on the old Royal Vein, damaging several residential properties and the operation's administration office. The Company is currently working closely with government to assist with the situation. Midas - transition to owner-mining completed (Nevada, USA, 100%) Normandy became owner-operator at the beginning of the quarter, with 160 mining, milling and technical services personnel hired. The mine produced 45,393ozs of gold and 603,377ozs of silver despite a four-day shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down to induct in·duct v. To produce an electric current or a magnetic charge by induction. and introduce Normandy safety values and work practices to the new employees. Record mine production was achieved in December. The first of two new surface ventilation ventilation, process of supplying fresh air to an enclosed space and removing from it air contaminated by odors, gases, or smoke. Proper ventilation requires also that there be a movement or circulation of the air within the space and that the temperature and rises was completed with fan installation under way. Electrical infrastructure improvements will be completed by the end of February. These projects eliminate the main source of historic bottlenecks underground. Bronzewing Bronzewing standard domestic turkey; black with bronzing on neck and back, and bronze barring on tail, which has a wide, white end-stripe. The female has white end-stripes on breast, back and wing bows, and secondary bows. Shanks are blackish-pink. - gold production 69,421ozs (Western Australia, 100%) Gold production was sourced from high grade underground ore and free-milling low grade stockpiles. Mill throughput exceeded forecast but gold production fell and recovery was adversely affected by the lower grade stockpile stock·pile n. A supply stored for future use, usually carefully accrued and maintained. tr.v. stock·piled, stock·pil·ing, stock·piles To accumulate and maintain a supply of for future use. material. Mining ceased at Lotus and focus turned to development of the 'Middle Zone' orebody. Capital works to improve recovery through increased oxygen addition will be completed next quarter. Boddington - scheduled closure (Western Australia, 44.44%) Operations ceased at the end of November following a very strong final two months. A cleanup and closure phase will be completed leading into full care-and-maintenance of the project during 2002. Wiluna - production and costs improve (Western Australia, 100%) Gold production increased slightly to 30,816ozs at an 18% lower total cash cost of $408/oz, reflecting reduced pit stripping ratios and higher recoveries. Underground, stoping of remnant ore at Bulletin commenced, development of the Woodley orebody continued, high-grade ores at Creek Shear shear: see strength of materials. Shear A straining action wherein applied forces produce a sliding or skewing type of deformation. were accessed and exploration drilling at Golden Age identified significant resource extensions. A feasibility study "A Feasibility Study" is an episode of the original The Outer Limits television show. It first aired on 13 April, 1964, during the first season. It was remade in 1997 as part of the revived The Outer Limits series with a minor title change. into redevelopment of East Lode and West Lode was completed and is under review. Additional drilling identified new high-grade zones in the Calvert lens and East Lode South lens. TVX TVx Target Vertex TVX Transmission Valid Timer (FDDI) TVX Valid Transmission Normandy Americas (49.9%) Attributable production was 48,498ozs, 4% above the previous quarter, while total cash costs decreased by 10% to $301/oz. Gold production at Paracatu increased by 3%, with all five ball mills now operating normally, offset by heavy rains which limited mine production. A new mining plan is in preparation to ensure optimum production. At Crixas, gold production was 10% lower as a result of lower grade and recovery, and total cash cost rose accordingly. Plant throughput was a record 744,300t for the calendar year. The Brazilian government's mandatory 20% energy reduction program is expected to remain in place until at least April 2002, while a stronger Brazilian real The real (IPA: [xe'aw] or [ʁe'aɫ], symbol: R$, ISO 4217 code: BRL, plural: reais) is the currency of Brazil. It is also the name of the earliest Brazilian currency (see from the Colonial period to 1942. affected costs. Gold production at La Coipa increased by 45% while silver production declined by 20% due to a lower silver grade and higher gold to silver ratio. A record 6.3Mt was processed for the calendar year at record low unit costs. Musselwhite gold production increased slightly, with a higher head grade offsetting lower throughput. The new Musselwhite First Nation agreement, which permits production up to 4,000tpd, is now in effect. Higher throughput at New Britannia was offset by a lower head grade, resulting in a slight decline in gold production and a 10% higher total cash cost. METALS Golden Grove - record mill throughput (Western Australia, 100 percent) Mine production increased by 5.1% to 331,792t (135,396t zinc ore, 196,396t copper ore). Mill throughput rose 7.2% to a record 347,948t, due largely to processing a higher tonnage of copper ore. The new SAG (1) A momentary drop in voltage from the power source. Contrast with spike. (2) (SAG) (SQL Access Group) See CLI. mill lifter design continues to improve mill throughput. Zinc feed grade remained steady at 11.6%, recovery increased to 90.86% and concentrate grade fell slightly to average 53.17%. Copper concentrate grade improved significantly to 24.26%. At Gossan gos·san n. An exposed, oxidized portion of a mineral vein, especially a rust-colored outcrop of iron ore. [Cornish gossen, from g Hill, the decline to access the high-grade Amity am·i·ty n. pl. am·i·ties Peaceful relations, as between nations; friendship. [Middle English amite, from Old French, from Vulgar Latin *am zinc orebody continued to advance on schedule, successfully passing through the Aquifer aquifer (ăk`wĭfər): see artesian well. aquifer In hydrology, a rock layer or sequence that contains water and releases it in appreciable amounts. Fault and progressing to a depth of 456m below surface.
GOLDEN GROVE PRODUCTION SUMMARY
periods ended 3 months 6 months 12 months
Dec. '01 Dec. '01 June '01
($/oz) ($/oz) ($/oz)
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Ore mined ('000t) 331.8 647.5 1,191.2
Zinc ore milled ('000t) 141.8 369.5 895.2
Grade (%) 11.6 11.6 12.1
Copper ore milled ('000t) 206.1 303.0 272.1
Grade (%) 5.4 5.3 4.8
Zinc concentrate (t) 28,199 72,663 182,655
Grade (%) 53.2 53.3 53.2
Copper concentrate (LPM) (t) 39,885 55,750 48,605
Grade (%) 24.3 23.8 22.4
Copper concentrate (HPM) (t) 409 873 4,202
Grade (%) 11.5 16.7 22.4
Silver grade (g/t) 2,109 1,120 1,931
Gold grade (g/t) 10.9 6.9 21.7
Lead concentrate (HPM) (t) 3,081 7,270 18,218
Grade (%) 32.9 33.7 32.0
Silver grade (g/t) 2,980 2,819 3,088
Gold grade (g/t) 36.9 33.5 25.6
Zinc sales(1)
Payable metal (t) 15,586 32,441 79,716
Estimated price (cent/lb) 55.95 64.82 85.4
Copper sales(1)
Payable metal (t) 7,549 10,235 11,683
Estimated price(2)(cent/lb) 1.04 1.11 147
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(1) Revenues on provisionally priced "open" pounds adjusted monthly,
based on then-current prices with settlement generally on average
LME price for specified future month.
(2) 2.08Mlb of payable copper provisionally priced at US68.04cent/lb.
GOLDEN GROVE ZINC PRODUCTION COST
periods ended 3 months 6 months 12 months
(unaudited) Dec. '01 Dec. '01 June '01
(cent/lb) (cent/lb) (cent/lb)
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Direct mining expenses 25 27 32
Transport & smelter charges 35 36 42
Mine development (2) (2) (3)
By-product credits (14) (12) (12)
Cash operating cost 44 49 59
Royalties 2 2 3
Total cash cost(1) 46 51 62
Depreciation 2 2 4
Amortisation 4 5 7
Mine closure 1 1 1
Total production cost(2) 53 59 74
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(1) US23cent/lb (US28cent/lb) at period average exchange rate.
(2) US26cent/lb (US32cent/lb) at period average exchange rate.
Kasese - production records set (Uganda, Banff Resources 63%) Cobalt production for the six months was 748,300lbs, an improvement of 15% over the previous six months. Production for the quarter was reduced by power supply equipment failures that have now been repaired. The average purity of cobalt cathodes remained at 99.91%. DEVELOPMENT - advancing Groundrush - project commissioned Project development to commissioning was completed ahead of schedule and below budget, with a stockpile established to minimise wet season disruptions. Martabe - feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. to proceed (Sumatra, Indonesia, 90%) The prefeasibility study of the Purnama gold deposit, one of a number of potential orebodies in the Martabe project area, has demonstrated that high returns can be achieved from a heap or dump leach leach v. leached, leach·ing, leach·es v.tr. 1. To remove soluble or other constituents from by the action of a percolating liquid. 2. operation for a low entry capital of approximately US$30M and operating cost of approximately US$105/oz, with an indicative average annual production of 150,000ozs. Review of the prefeasibility was completed in January, resulting in a recommendation to proceed to feasibility study stage. Favona - project permitting continues Work continued on the permitting process for the underground project. Filing of the application is now anticipated towards the end of first quarter of 2002. Boddington - approvals process ongoing Formal assessment of the environmental protection statement submission progressed on schedule. Negotiations between the owners and the outgoing management company progressed satisfactorily. EXPLORATION - exciting Expenditure on direct interests worldwide was $13.53 million. Jundee - Westside, major high-grade resource Ongoing surface and underground drilling continued to return positive results from the Westside lode structure . This is now shaping as a major new Barton Deeps-style high-grade resource within the adjoining Hughes dolerite dol·er·ite n. Chiefly British A dark, fine-grained igneous rock; diabase. [French dolérite, from Greek doleros, deceitful (from its easily being mistaken for diorite) host unit, with potential for further lateral and down dip extension. Drillholes typically intersect In a relational database, to match two files and produce a third file with records that are common in both. For example, intersecting an American file and a programmer file would yield American programmers. multiple mineralised zones. High-grade intercepts returned during the quarter include 0.8m at 184g/t, plus 1.2m at 172g/t; 3.7m at 33g/t, plus 1.1m at 110g/t; 1.4m at 148g/t, plus 0.4m at 26g/t, 1.2m at 16g/t and 1.6m at 17g/t; 1m at 51g/t; and a spectacular 5m at 3,288g/t (106oz/t, uncut) from one of the deepest holes drilled into the structure. A crosscut from Barton Deeps has intersected the main Westside lode structure, and initial face sampling is consistent with drilling results. Positive results were also returned from drilling of the Gateway structure, including 2.3m at 57g/t from 551m, and 3m at 5g/t from 542m. Tanami - new Callie mineralised position Assaying of previously untested drillhole intervals was completed, particularly the upper portions of completed holes into the Kerril South-Wilson Shoot mineralised positions. Significant results included 2m at 75.2g/t from 1035m (DBD DBD DNA binding Domain (nuclear receptors) DBD Database Design DBD Day-By-Day DBD Database Description dBd Decibels (dipole antenna) DBD Death Before Dishonor (gaming clan) 413D3) confirming a mineralised position some 300m above the Kerril South body. Follow-up drilling of this new position is a high priority objective early in 2002. Geophysical surveying Geophysical survey refers to the systematic collection of geophysical data for spatial studies. Geophysical surveys may use a great variety of sensing instruments, and data may be collected from above or below the Earth's surface or from aerial or marine platforms. of the Groundrush deposit and immediate environs located a strong chargeability anomaly Abnormality or deviation. Pronounced "uh-nom-uh-lee," it is a favorite word among computer people when complex systems produce output that is inexplicable. See software conflict and anomaly detection. associated with the northern extension of the deposit and drilling commenced early in January 2002 to test the resource potential. Potential for shoot-like depth extensions to the mineralisation was also highlighted and deeper drilling is a priority for the first half of 2002. Favona - further high grade intersections Further drilling of the Favona discovery adjacent to the Waihi Operations treatment plant has returned several significant new intersections. Hole UW94 intersected five mineralised veins in the interval 338m to 388m - 4m at 4.8g/t, 3m at 4.6g/t, 6m at 83g/t (reported last quarter), 4m at 5.1g/t, and 1m at 24g/t. Hole UW98 cut five mineralised veins in the interval 155m to 266m, including 19m at 9g/t from 180m. Metallurgical met·al·lur·gy n. 1. The science that deals with procedures used in extracting metals from their ores, purifying and alloying metals, and creating useful objects from metals. 2. testwork commenced. Ovacik - near-mine exploration to resume The launching of mining operations has enabled a new appraisal of potential for extensions to the defined resources contained in the M and S Vein orebodies, as well as other near-mine resource potential. Initial focus will be on depth extensions to M vein, below a string of high grade intersections extending over some 340m along the orebody margin, as defined by earlier exploration drilling in 1993. This work is under way. Martabe - step-out drilling At the Gerhana prospect, three step-out holes tested the strike extent of mineralisation reported last quarter. Hole APSD APSD Automatic Power Save Delivery (IEEE) APSD Automatic Power Shutdown (Lucent) APSD Aerodynamic Particle Size Distribution APSD Areal Power Spectral Density (surface texture) 115, located some 400m southeast, intersected 27m at 2.8g/t from surface, while hole ASPD ASPD Anti-Social Personality Disorder ASPD Altamonte Springs Police Department (Altamonte, FL, USA) ASPD Association of Specialist Providers to Dentists (UK) ASPD AEGIS Ship Program Directive 116, some 200m west, returned 19m at 1.02g/t from 8m. Further infill in·fill n. 1. The use of vacant land and property within a built-up area for further construction or development, especially as part of a neighborhood preservation or limited growth program. 2. drilling is required to confirm continuity of this 600m strike length mineralised zone. At the Pelangi prospect, a further five holes tested some 2.6km strike length of silicified si·lic·i·fy v. si·lic·i·fied, si·lic·i·fy·ing, si·lic·i·fies v.tr. To convert into or impregnate with silica. v.intr. To become converted into or impregnated with silica. hydrothermal hydrothermal, hydrothermic relating to the temperature effects of water, as in hot baths. breccias. Gold assays were generally low, with sporadic sporadic /spo·rad·ic/ (spo-rad´ic) occurring singly; widely scattered; not epidemic or endemic. spo·rad·ic or spo·rad·i·cal adj. 1. Occurring at irregular intervals. 2. higher values. The best intercepts were 56m at 0.74g/t, including 8m at 1.64g/t, and 115m at 0.94g/t, including 11m at 1.95g/t (both from surface). Drillhole spacing at Pelangi is generally around 300m, and the scope for further work is being assessed, aided by a preliminary estimate of resource potential. Midas - new vein intersections Underground drilling at Midas targeted the southern hanging wall between the Colorado Grande and Snow White veins to test for mineralised splays off the main veins at around the 5,100' and 5,250' levels. The Snow White vein returned consistent assays exceeding one ounce to the ton over narrow widths. Between the Colorado Grande and Snow White veins, multiple splays were intersected, with several of economic width and grade, including a best 1.1m at 35.7g/t. Wiluna - Williamson potential enhanced The Williamson resource, south of Wiluna beneath Lake Way, has been further enhanced by recent drilling results. Seven follow-up diamond drill holes tested the 1.4km known strike extent of the mineralised structure. All holes intersected the mineralised zone and returned elevated gold values. Significant results include 4m at 5.9g/t from 121m plus 3m at 2.6g/t from 133m; 1m at 13.6g/t from 122m plus 11m at 2.6g/t from 135m; and 73m at 1.3g/t from 145m, including 5m at 9.6g/t and 1m at 11.2g/t. The structure is open to the south, with results from shallow drilling of the most southerly line of holes including 4m at 25.6g/t from 32m. Its northern limit is also not defined, and further drilling is planned to trace the structure towards Wiluna. Tipperary Well - significant intercepts At Tipperary Well (60km north of Bronzewing), further aircore drilling better defined bedrock structure and its controls on gold mineralisation. Significant intercepts included 4m at 6.0g/t from 32m, 4m at 4.8g/t from 64m, 4m at 8.7g/t from 76m, and 1m at 6.9g/t from 60m. Results to date from follow-up deeper RC and diamond drilling Diamond Drilling is a highly specialized industry used for mineral exploration around the world. Most commonly using wireline and core bits with diamond encrusted matrix. To drill holes to max depths of twelve thousand feet, for the recovery of core used in verifying mineral returned low gold values, and further results are awaited a·wait v. a·wait·ed, a·wait·ing, a·waits v.tr. 1. a. To wait for. See Synonyms at expect. b. . Chile - Codelco joint venture A joint venture is currently in formation with Codelco, the Chilean State-owned copper producer, to explore selected Codelco properties in Chile for copper and gold to earn a 50% interest. Normandy will contribute the superior geophysical survey capability of its proprietary helicopter-borne time-domain EM system to the venture. Drill testing of high priority targets in proximity to major new gold and porphyry Porphyry, Greek scholar Porphyry (pôr`fĭrē), c.232–c.304, Greek scholar and Neoplatonic philosopher. He studied rhetoric under Cassius Longinus and philosophy under Plotinus. copper discoveries will commence early in 2002. Calcatreu - new work program commences (Argentina, TVX Normandy 100%) A drilling program has commenced to test the depth extensions of the mineralised epithermal veins and new veins defined by geophysical surveys. This follows a detailed study of host structures, vein textures and mineralogies, and the conclusion that favourable structural positions at lower vein elevations have the potential to host significant mineralisation. Peru - farm-in agreement Normandy has entered into a farm-in agreement on the Humajala property, some 80km north of Arequipa in southern Peru. Previous work identified a large epithermal-style alteration Modification; changing a thing without obliterating it. An alteration is a variation made in the language or terms of a legal document that affects the rights and obligations of the parties to it. system in volcanics, carrying gold mineralisation in outcrop. The agreement allows Normandy to earn up to an 80% interest, principally by funding exploration of the property. Drilling is planned to commence in March 2002. Golden Grove - new Scuddles mineralised zone A revised interpretation of the Scuddles Deeps orebody identified a faulted wedge of untested favourable stratigraphy stratigraphy, branch of geology specifically concerned with the arrangement of layered rocks (see stratification). Stratigraphy is based on the law of superposition, which states that in a normal sequence of rock layers the youngest is on top and the oldest on the . Four drillholes completed to date all intersected significant mineralisation, defining the new Zeewijk mineralised zone. The zone is interpreted to have a strike length of around 135m, a vertical extent of around 135m, and is around 20m thick at an average grade of 14.5% zinc. This is a significant addition to the Scuddles resource, with positive implications for future development of the adjoining deep Batavia resource. One concept being pursued is a drive linking the additional Gossan Hill discoveries to Scuddles, providing cheaper haulage and drilling horizons to test prospective zones in the 5km strike between the two major mineralised positions. At Gossan Hill, two further diamond drillholes into the new Ethel zone returned significant results. Some 150m south of the first hole into the zone, hole RHDD RHDD Removable Hard Disk Drive RHDD Removable Hdd RHDD Residential Home for Developmentally Disabled (Coshocton, OH) 039D1 intersected 22.7m at 30.8% zinc, 4% lead, 1% copper, 7.9g/t gold and 384g/t silver. The second hole infilling this 150m gap returned 2.4m at 15.6% zinc and 0.75g/t gold, accompanied by 15.75m at 2.3% copper and 1.6g/t gold in a massive pyrite pyrite (pī`rīt) or iron pyrites (pīrī`tēz, pə–, pī`rīts), pale brass-yellow mineral, the bisulfide of iron, FeS2. footwall foot·wall n. Geology 1. The mass of rock underlying a mineral deposit in a mine. 2. The underlying block of a fault having an inclined fault plane. zone. Information in this report relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc ore reserves, mineral resources Noun 1. mineral resources - natural resources in the form of minerals natural resource, natural resources - resources (actual and potential) supplied by nature or mineralisation conforms to the requirements of the "Australasian Code for Reporting of Identified Mineral Resources and Ore Reserves" (JORC JORC Joint Ore Reserves Committee Code). It is based on information compiled by M Hatcher hatch 1 n. 1. a. An opening, as in the deck of a ship, in the roof or floor of a building, or in an aircraft. b. The cover for such an opening. c. A hatchway. d. , Chief Operations Geologist, Normandy Mining Limited, member of the AusIMM and a Competent Person as defined by the Code, and is included in this report with his consent. HEDGING - value adding Gold hedging policy has been revised, reducing the minimum hedge ratio Hedge Ratio 1. A ratio comparing the value of a position protected via a hedge with the size of the entire position itself. 2. A ratio comparing the value of futures contracts purchased or sold to the value of the cash commodity being hedged. Notes: 1. from 60% to 45% of operating mines' Reserves. Committed hedging has been reduced, allowing 100% upside participation on 70% of total Reserves (Ovacik and Midas remain unhedged), whilst retaining a prudent level of downside protection Downside Protection Generally used in connection with covered call writing, this is the cushion against loss, in case of a price decline by the underlying security, that is afforded by the written call option. . Hedging policy was revised because net gearing has been materially reduced (from 57% at June 2000 to around 40%) and a target of 30% has been adopted. Further, lower interest rates and higher gold interest rates have significantly reduced gold contango Contango When the futures price is above the expected future spot price. Consequently, the price will decline to the spot price before the delivery date. Notes: This is the opposite of backwardation. , making hedging less attractive. More than 1.3 million ounces of long term fixed price forward contracts have been bought back, increasing uncommitted puts in the reduced hedge book from 18% at June 2001 to 24%. Gold interest rate exposure on 40% of contracts has been fixed to maturity and 100% of all contracts maturing over the next one and a half years have been fixed, eliminating exposure to short term fluctuations in gold interest rates.
GOLD HEDGING POSITIONS (at 16 January 2002)
(Australian Gold Council Standard) '000ozs A$/oz(1)
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NORMANDY WHOLLY-OWNED
Forward Sales
2001-02 52 522
2002-03 1,112 518
2003-04 671 543
2004-05 458 550
2005-10 2,172 535
Total 4,465 533
Put Options Purchased
2001-02 515 526
2002-03 167 520
2003-04 9 529
2004-05 129 527
2005-10 464 523
Total 1,284 524
Convertible Options Purchased
2005-12 1,507 554
Total 1,507 554
NORMANDY NFM LIMITED(2)
& OTTER GOLD MINES LIMITED
Forward Sales
2001-02 179 574
2002-03 518 573
2003-04 413 566
2004-05 279 568
2005-07 244 555
Total 1,633 568
Put Options Purchased
2001-02 50 534
2002-03 5 542
Total 55 534
'000ozs US$/oz
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TVX NORMANDY AMERICAS
Put Options Purchased
2001-02 88 275
2002-03 209 272
2003-04 210 272
2004-05 195 268
2005-09 303 320
Total 1,005 286
'000ozs $/oz
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Total A$ Contracts(3,4) 8,944 543
Total US$ Contracts(3,4) 1,005 286
Committed A$ Contracts 7,605 545
Committed US$ Contracts - -
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CORPORATE - strategy delivering positive results Takeover Offers for Normandy - Newmont bid recommended Normandy is currently the subject of competing takeover offers from Newmont Mining Newmont Mining Corporation NYSE: NEM, based in Denver, Colorado, USA, is one of the world's largest producers of gold, with active mines in, Nevada, Indonesia, Australia/New Zealand, Ghana, and Peru. Some smaller operations include Bolivia, Mexico, and Canada. Corporation of the USA and AngloGold Limited of South Africa South Africa, Afrikaans Suid-Afrika, officially Republic of South Africa, republic (2005 est. pop. 44,344,000), 471,442 sq mi (1,221,037 sq km), S Africa. . Normandy Directors, subject to their fiduciary duties Noun 1. fiduciary duty - the legal duty of a fiduciary to act in the best interests of the beneficiary legal duty - acts which the law requires be done or forborne , continue to recommend acceptance of the Newmont offer and, therefore, rejection of the AngloGold offer. AMC Capital Raising - successful A capital raising of $525 million was successfully completed by Australian Magnesium magnesium (măgnē`zēəm, –zhəm), metallic chemical element; symbol Mg; at. no. 12; at. wt. 24.305; m.p. about 648.8°C;; b.p. about 1,090°C;; sp. gr. 1.738 at 20°C;; valence +2. Corporation (AMC) to finance the Stanwell Magnesium Project. This important step facilitates the development of an Australian light metals (Chem.) the metallic elements of the alkali and alkaline earth groups, as sodium, lithium, calcium, magnesium, etc.; also, sometimes, the metals of the earths, as aluminium. See also: Metal industry in which Normandy has played a pivotal role. Non-Core Asset Sales - Ity and Tasiast Offers have been accepted, subject to documentation, for the sale of Normandy's interests in the Ity gold mine (Cote d'Ivoire, 51%) and the Tasiast gold property (Mauritania, 100%) for a cash consideration of up to $33.3 million. These transactions will generate a combined profit of approximately $6 million and contribute to a reduction in the Company's gearing ratio Gearing Ratio A general term describing a financial ratio that compares some form of owner's equity (or capital) to borrowed funds. Gearing is a measure of financial leverage, demonstrating the degree to which a firm's activities are funded by owner's funds versus creditor's funds. , whilst retaining royalty exposure over future production. Otter Gold Mines Offer - succeeds The takeover offer by Normandy NFM Limited for Otter Gold Mines Limited was declared unconditional HEIR, UNCONDITIONAL. A term used in the civil law, adopted by the Civil Code of Louisiana. Unconditional heirs are those who inherit without any reservation, or without making an inventory, whether their acceptance be express or tacit. Civ. Code of Lo. art. 878. UNCONDITIONAL. on 28 December 2001. Normandy NFM had received acceptances for 62.59% of shares by 15 January 2002. The offer will remain open until 29 January 2002. Successful conclusion of this transaction will significantly enhance Normandy NFM's dominant position in the Tanami region, adding interests in the Tanami mill and approximately 20,000km2 of exploration tenements. The transaction will also provide a collateral benefit to Normandy, with full control and the potential for full ownership of Waihi Operations (including the high grade Favona gold deposit) through the acquisition of Otter's 33% and 50% interests (subject to Normandy earn-in rights) in the two relevant joint ventures. Normandy Mt Leyshon - restructured Shareholders approved a restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). of subsidiary, Normandy Mt Leyshon Limited, on 14 August 2001. The new company, Leyshon Resources Limited, will focus on mineral exploration in the Musgrave region of Western Australia and the Kidston, Agate Creek and Cloncurry regions of North Queensland North Queensland is the northern part of the state of Queensland in Australia. Queensland is a massive state, larger than most countries, and the Tropical northern part of it has been historically remote and underdeveloped, resulting in a distinctive regional character and . Normandy holds a 13.7% interest in the company.
INVESTOR INFORMATION
Board of Directors
RJ Champion de Crespigny Chairman & Chief Executive
MS Hamson Non-Executive Director
P Lassonde Non-Executive Director
BG McKay Non-Executive Director
JB Prescott AC Non-Executive Director
KH Spencer Non-Executive Director
B Wheelahan Non-Executive Director
Registered & Principal Office
100 Hutt Street, Adelaide 5000, South Australia, Australia
Tel: +61 8 8303 1700; Fax: +61 8 8303 1900
E-mail: investor@normandy.com.au
PF Carr Company Secretary
Issued Capital
At 31 December 2001, issued capital was 2,237,861,347 shares.
Shareholder Enquiries
Matters relating to shares held, change of address, tax file
number and dividends should be directed to the Share Registry:
National Shareholder Services Pty Limited
100 Hutt Street, Adelaide 5000, South Australia, Australia
Tel: +61 8 8232 0003; Fax: +61 8 8232 0072
E-Mail: shareregistry@normandy.com.au
Stock Exchange Listings
Australian Stock Exchange Ticker Symbol NDY
Toronto Stock Exchange Ticker Symbol NDY
ADS Depositary
The Bank of New York, 101 Barclay Street, New York, NY 10286
Tel: +1 212 815 2204; Fax: +1 212 571 3050
Quarterly Share Price Movement
Mar. '01 Jun. '01 Sept. '01 Dec. '01
High $1.00 $1.24 $1.38 $1.85
Low $0.88 $1.01 $1.06 $1.31
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Notes to Hedging (page 7)
-------------------------
(1) Net of lease fees for actual lease fees that are fixed, with the
balance assumed at 2%.
(2) 100% of subsidiaries.
(3) Margin calls do not apply to any contracts.
(4) No separate foreign exchange contracts relating to the gold
hedging.
Deferred income from hedge close-outs to be brought to the income
statement:
($M)
2001-02 40.2
2002-03 56.4
2003-04 48.6
2004-05 46.8
2005-10 13.5
Total 205.5
The hedge book mark-to-market value at 16 January 2002 was:
($M)(i)
Normandy (ii) (467)
Normandy NFM (iii) (3)
Otter Gold Mines (iii) (25)
(i) Spot price at 16 January 2002, $549/oz.
(ii) Wholly-owned, including TVX Normandy Americas.
(iii) 100 percent of subsidiaries.
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