7Subsequent events
(a) On 25 February 2009 the Group exercised its option to purchase further
4,330,000 shares of Gold Resource Corporation for approximately US$12,900,000
(US$3 per share), representing a 41% discount to the closing price of the same
date. Alter the purchase the Group owns 14.6% interest in Gold Resource
Corporation.
(b) On 6 March 2009 the Group served a notice of termination of the existing
commercial agreement to Argor Heraeus. We are in the process of seeking more
favourable commercial terms for the Group from alternative customers.
(c) On 9 March 2009 the Group acquired 14,900,000 shares of its associate Lake
Shore Gold for CAD$23,100,000 (approximately US$18,000,000) as part of its
commitment to participate in the bought-deal financing agreement entered by Lake
Shore Gold to raise approximately CAD$60,000,000. The proceeds from the
financing will be used for the advancement of Lake Shore Gold's mineral
projects. After completion of the transaction, the Group's ownership in
Lake Shore Gold is maintained at 40%.
(d) On 23 March 2009 the Group signed a definitive Arrangement Agreement to
acquire all the outstanding shares of Southwestern Resources Corp.
("Southwestern"), a Canadian listed mineral exploration company with a number of
gold, silver and base metals projects in southern Peru, for a total cash
consideration of US$17,600,000 (US$0.39 per share). Southwestern is the
strategic partner of the Group in the Liam and Pacapausa joint ventures. With
the acquisition, the Group will own the remaining 50% of the Liam joint venture
property and increase its interest in the Pacapausa joint venture from 30% to
80%. This transaction is subject to the approval of Southwestern's shareholders
which is expected to occur by 8 May 2009.
Reserves & Resources (Audited by IMC Group Consulting Limited)
Attributable metal reserves
As at 31 December 2008*
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Reserve | Proved | Probable | Proved And | Ag | Au | | Ag | Au | Ag |
| category | | | probable | | | | | | Eq. |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| | (t) | (t) | (t) | (g/t) | (g/t) | | (moz) | (koz) | (moz) |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Arcata | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 929,683 | | | 575 | 1.80 | | 17.19 | 53.78 | 20.42 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 681,241 | | 495 | 1.38 | | 10.85 | 30.20 | 12.66 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 1,610,924 | 541 | 1.62 | | 28.04 | 83.98 | 33.08 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Ares | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 464,180 | | | 124 | 5.01 | | 1.84 | 74.77 | 6.33 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 185,225 | | 112 | 4.49 | | 0.67 | 26.72 | 2.27 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 649,405 | 120 | 4.86 | | 2.51 | 101.49 | 8.60 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Selene | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 75,686 | | | 275 | 2.04 | | 0.67 | 4.97 | 0.97 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 51,662 | | 257 | 1.94 | | 0.43 | 3.22 | 0.62 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 127,348 | 268 | 2.00 | | 1.10 | 8.19 | 1.59 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Pallancata | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 1,179,218 | | | 380 | 1.60 | | 14.40 | 60.70 | 18.04 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 1,402,004 | | 354 | 1.43 | | 15.94 | 64.31 | 19.80 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 2,581,222 | 366 | 1.51 | | 30.34 | 125.02 | 37.84 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| San José | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 264,461 | | | 508 | 7.92 | | 4.32 | 67.36 | 8.36 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 567,958 | | 529 | 7.90 | | 9.65 | 144.17 | 18.30 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 832,419 | 522 | 7.90 | | 13.97 | 211.53 | 26.66 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Moris | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 1,132,556 | | | 4.60 | 1.44 | | 0.18 | 57.39 | 3.63 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 106,982 | | | | | 0.00 | 0.00 | 0.00 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 1,239,538 | 4.60 | 1.44 | | 0.18 | 57.39 | 3.63 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | | | | | | | |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Proved | 4,152,766 | | | 289 | 2.39 | | 38.60 | 318.97 | 57.74 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Probable | | 2,888,091 | | 404 | 2.89 | | 37.53 | 268.63 | 53.65 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
| Total | | | 7,040,857 | 336 | 2.60 | | 76.13 | 587.60 | 111.39 |
+----------------+-----------+-----------+------------------+---------+---------+--+-------+--------+--------+
Note: Where reserves are attributable to joint venture partner, reserve figures
reflect the Company's ownership only. Includes discounts for ore loss and
dilution.
*2008 reserve and resource figures are not comparable to 2007 due to the
increase in cut-off grades
Attributable metal resources (Audited by IMC Group Consulting Limited)
As at 31 December 2008*
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Resource | Measured | Indicated | Measured | Inferred | Ag | Au | Zn | Pb | Cu | Ag Eq | | Ag | Au | Zn | Pb | Cu |
| category | | | and | | | | | | | | | | | | | |
| | | | indicated | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| | (t) | (t) | (t) | (t) | (g/t) | (g/t) | (%) | (%) | (%) | (g/t) | | (moz) | (koz) | (kt) | (kt) | (kt) |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Arcata | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 1,302,535 | | | | 662 | 2.06 | -.- | -.- | -.- | 786 | | 27.73 | 86.17 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 822,655 | | | 601 | 1.67 | -.- | -.- | -.- | 701 | | 15.90 | 44.23 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 2,125,190 | | 639 | 1.91 | -.- | -.- | -.- | 753 | | 43.63 | 130.40 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 1,815,443 | 519 | 1.56 | -.- | -.- | -.- | 613 | | 30.29 | 90.97 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Ares | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 512,061 | | | | 167 | 7.10 | -.- | -.- | -.- | 593 | | 2.74 | 116.90 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 206,473 | | | 148 | 5.66 | -.- | -.- | -.- | 488 | | 0.98 | 37.60 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 718,534 | | 161 | 6.69 | -.- | -.- | -.- | 563 | | 3.73 | 154.51 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 298,881 | 236 | 3.96 | -.- | -.- | -.- | 473 | | 2.26 | 38.06 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Selene | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 190,853 | | | | 338 | 2.15 | -.- | -.- | -.- | 467 | | 2.07 | 13.18 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 99,317 | | | 274 | 1.68 | -.- | -.- | -.- | 375 | | 0.88 | 5.35 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 290,170 | | 316 | 1.99 | -.- | -.- | -.- | 435 | | 2.95 | 18.53 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 912,951 | 227 | 1.15 | -.- | -.- | -.- | 296 | | 6.66 | 33.76 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Pallancata | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 1,180,769 | | | | 431 | 1.82 | -.- | -.- | -.- | 540 | | 16.36 | 69.03 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 1,401,686 | | | 402 | 1.63 | -.- | -.- | -.- | 500 | | 18.12 | 73.54 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 2,582,455 | | 415 | 1.72 | -.- | -.- | -.- | 518 | | 34.48 | 142.57 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 734,346 | 395 | 1.57 | -.- | -.- | -.- | 488 | | 9.31 | 36.97 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| San | | | | | | | | | | | | | | | | |
| José | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 263,331 | | | | 581 | 8.96 | -.- | -.- | -.- | 1,119 | | 4.92 | 75.89 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 879,679 | | | 515 | 7.77 | -.- | -.- | -.- | 981 | | 14.57 | 219.66 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 1,143,010 | | 530 | 8.04 | -.- | -.- | -.- | 1,013 | | 19.49 | 295.55 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 540,305 | 333 | 5.72 | -.- | -.- | -.- | 676 | | 5.78 | 99.33 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Moris | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 1,675,682 | | | | 4.48 | 1.28 | -.- | -.- | -.- | 81 | | 0.24 | 68.80 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 131,776 | | | 4.44 | 1.19 | -.- | -.- | -.- | 76 | | 0.02 | 5.06 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 1,807,458 | | 4.48 | 1.27 | -.- | -.- | -.- | 81 | | 0.26 | 73.86 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 294,288 | 4.81 | 1.22 | -.- | -.- | -.- | 78 | | 0.05 | 11.50 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Azuca | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | -.- | | | | -.- | -.- | -.- | -.- | -.- | -.- | | -.- | -.- | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | -.- | | | -.- | -.- | -.- | -.- | -.- | -.- | | -.- | -.- | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | -.- | | -.- | -.- | -.- | -.- | -.- | -.- | | -.- | -.- | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 1,776,034 | 327 | 1.34 | -.- | -.- | -.- | 408 | | 18.69 | 76.41 | -.- | -.- | -.- |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| San | | | | | | | | | | | | | | | | |
| Felipe | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 1,393,716 | | | | 69 | 0.02 | 7.12 | 3.10 | 0.39 | 315 | | 3.09 | 0.88 | 99.26 | 43.15 | 5.50 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 1,354,261 | | | 82 | 0.06 | 6.14 | 2.73 | 0.31 | 295 | | 3.59 | 2.45 | 83.18 | 36.97 | 4.24 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 2,747,977 | | 76 | 0.04 | 6.64 | 2.92 | 0.35 | 305 | | 6.68 | 3.33 | 182.45 | 80.12 | 9.74 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 1,257,731 | 84 | 0.05 | 6.18 | 2.26 | 0.19 | 283 | | 3.42 | 1.89 | 77.76 | 28.47 | 2.34 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| TOTAL | | | | | | | | | | | | | | | | |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Measured | 6,518,948 | | | | 273 | 2.06 | 1.52 | 0.66 | 0.08 | 448 | | 57.15 | 430.86 | 99.26 | 43.15 | 5.50 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Indicated | | 4,895,848 | | | 343 | 2.46 | 1.70 | 0.76 | 0.09 | 549 | | 54.06 | 387.90 | 83.18 | 36.97 | 4.24 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Total | | | 11,414,795 | | 303 | 2.23 | 1.60 | 0.70 | 0.09 | 492 | | 111.21 | 818.76 | 182.45 | 80.12 | 9.74 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
| Inferred | | | | 7,629,979 | 312 | 1.59 | 1.02 | 0.37 | 0.03 | 439 | | 76.46 | 388.89 | 77.76 | 28.47 | 2.34 |
+------------+-----------+------------+------------+-----------+--------+--------+--------+--------+--------+--------+--------+--------+--------+----------+----------+---------+
Note: Resources include undiscounted reserves, where resources are attributable
to joint venture partner, resources figures reflect the Company's ownership
only. No ore loss or dilution has been included, and stockpiled ore excluded.
*2008 reserve and resource figures are not comparable to 2007 due to the
increase in cut-off grades
Change in metal reserves and resources in silver equivalent ounces*
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Ag equivalent content (million ounces) |
+---------------------------------------------------------------------------------------------------+
| Operation | Category |December |Production (1) |Movements |December | Net |% change |
| | | 2007 | | (2) | 2008 |difference | |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Peru | | | | | | | |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Arcata | Resource | 70.3 | | 16.9 | 87.2 | 16.9 | 24% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 32.4 | -12.0 | 12.7 | 33.1 | 0.7 | 2% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Ares | Resource | 16.8 | | 0.7 | 17.5 | 0.7 | 4% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 14.6 | -5.3 | -0.7 | 8.6 | -6.0 | (41%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Selene | Resource | 18.5 | | -5.8 | 12.7 | -5.8 | (31%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 9.6 | -2.9 | -5.1 | 1.6 | -8.0 | (83%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Pallancata | Resource | 83.2 | | 7.8 | 90.9 | 7.8 | 9% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 41.4 | -5.9 | 27.6 | 63.1 | 21.6 | 52% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Peru Total: | Resource | 188.8 | | 19.7 | 208.4 | 19.7 | 10% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 98.0 | -26.2 | 34.5 | 106.3 | 8.3 | 8% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Argentina | | | | | | | |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| San José | Resource | 90.1 | | 5.9 | 96.0 | 5.9 | 7% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 66.2 | -9.6 | -4.3 | 52.3 | -13.9 | (21%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Argentina | Resource | 90.1 | | 5.9 | 96.0 | 5.9 | 7% |
| Total: | | | | | | | |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 66.2 | -9.6 | -4.3 | 52.3 | -13.9 | (21%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Mexico | | | | | | | |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Moris | Resource | 9.5 | | -1.7 | 7.8 | -1.7 | (18%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 7.7 | -3.1 | 0.5 | 5.2 | -2.6 | (33%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| San Felipe | Resource | 27.6 | | 10.8 | 38.5 | 10.8 | 39% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | | 0.0 | 0.0 | | 0.0 | 0% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Mexico | Resource | 37.1 | | 9.1 | 46.2 | 9.1 | 25% |
| Total: | | | | | | | |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 7.7 | -3.1 | 0.5 | 5.2 | -2.6 | (33%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| Total: | Resource | 316.0 | | 34.7 | 350.6 | 34.7 | 11% |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
| | Reserve | 172.0 | -38.9 | 30.7 | 163.8 | -8.2 | (5%) |
+-------------+----------+----------+----------------+-----------+----------+------------+----------+
1 Production: reduction in reserves based on ore delivered to the mine
plant.
2 Increase in reserves and resources due mainly to mine site
exploration but also to price increases.
*2008 reserve and resource figures are not comparable to 2007 due to the
increase in cut-off grades introduced
Change in attributable metal reserves and resources in silver equivalent ounces
+-------------+----------+--------------+----------+----------+------------+----------+
| Ag equivalent content (million ounces) |
+-------------------------------------------------------------------------------------+
| Operation | Category | Percentage |December |December | Net |% change |
| | |attributable | 2007 | 2008 |difference | |
| | | | Att.1 | Att. 1 | | |
+-------------+----------+--------------+----------+----------+------------+----------+
| Peru | | | | | | |
+-------------+----------+--------------+----------+----------+------------+----------+
| Arcata | Resource | 100% | 70.3 | 87.2 | 16.9 | 24% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 32.4 | 33.1 | 0.7 | 2% |
+-------------+----------+--------------+----------+----------+------------+----------+
| Ares | Resource | 100% | 16.8 | 17.5 | 0.7 | 4% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 14.6 | 8.6 | -6.0 | (41%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| Selene | Resource | 100% | 18.5 | 12.7 | -5.8 | (31%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 9.6 | 1.6 | -8.0 | (83%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| Pallancata | Resource | 60% | 49.9 | 54.6 | 4.7 | 9% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 24.9 | 37.8 | 13.0 | 52% |
+-------------+----------+--------------+----------+----------+------------+----------+
| Peru Total: | Resource | | 155.5 | 172.1 | 16.6 | 11% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 81.5 | 81.1 | -0.4 | 0% |
+-------------+----------+--------------+----------+----------+------------+----------+
| Argentina | | | | | | |
+-------------+----------+--------------+----------+----------+------------+----------+
| San José | Resource | 51% | 45.9 | 49.0 | 3.0 | 7% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 33.7 | 26.7 | -7.1 | (21%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| Argentina | Resource | | 45.9 | 49.0 | 3.0 | 7% |
| Total: | | | | | | |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 33.7 | 26.7 | -7.1 | (21%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| Mexico | | | | | | |
+-------------+----------+--------------+----------+----------+------------+----------+
| Moris | Resource | 70% | 6.6 | 5.4 | -1.2 | (18%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 5.4 | 3.6 | -1.8 | (33%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| San Felipe | Resource | 100% | 27.6 | 38.5 | 10.8 | 39% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 0.0 | 0.0 | 0.0 | 0% |
+-------------+----------+--------------+----------+----------+------------+----------+
| Mexico | Resource | | 34.3 | 43.9 | 9.6 | 28% |
| Total: | | | | | | |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 5.4 | 3.6 | -1.8 | (33%) |
+-------------+----------+--------------+----------+----------+------------+----------+
| Total: | Resource | | 235.7 | 264.9 | 29.2 | 12% |
+-------------+----------+--------------+----------+----------+------------+----------+
| | Reserve | | 120.6 | 111.4 | -9.2 | (8%) |
+-------------+----------+--------------+----------+----------+------------+----------+
1 Attributable reserves and resources based on the Group's percentage ownership
of its joint venture projects.
*2008 reserve and resource figures are not comparable to 2007 due to the
increase in cut-off grades
TOTAL GROUP PRODUCTION1
+--------------------------+----------------+--------------+---------+
| | Year ended 31 | Year ended | % |
| | December 2008 | 31 December | change |
| | | 2007 | |
+--------------------------+----------------+--------------+---------+
| Silver production (koz) | 20,782 | 14,343 | 45% |
+--------------------------+----------------+--------------+---------+
| Gold production (koz) | 193.97 | 211.38 | (8%) |
+--------------------------+----------------+--------------+---------+
| Total silver equivalent | 32,421 | 27,026 | 20% |
| (koz) | | | |
+--------------------------+----------------+--------------+---------+
| Total gold equivalent | 540.34 | 450.43 | 20% |
| (koz) | | | |
+--------------------------+----------------+--------------+---------+
| Silver sold (koz) | 20,593 | 13,717 | 50% |
+--------------------------+----------------+--------------+---------+
| Gold sold (koz) | 198.32 | 202.10 | (2%) |
+--------------------------+----------------+--------------+---------+
1 Total production includes 100% of all production, including production
attributable to joint venture partners at Moris, San José and Pallancata.
ATTRIBUTABLE GROUP PRODUCTION1
+--------------------------+----------------+--------------+---------+
| | Year ended 31 | Year ended | % |
| | December 2008 | 31 December | change |
| | | 2007 | |
+--------------------------+----------------+--------------+---------+
| Silver production (koz) | 16,941 | 13,588 | 25% |
+--------------------------+----------------+--------------+---------+
| Gold production (koz) | 152.86 | 201.27 | (24%) |
+--------------------------+----------------+--------------+---------+
| Attrib. silver | 26,113 | 25,665 | 2% |
| equivalent (koz) | | | |
+--------------------------+----------------+--------------+---------+
| Attrib. gold equivalent | 435.22 | 427.74 | 2% |
| (koz) | | | |
+--------------------------+----------------+--------------+---------+
1 Attributable production includes 100% of all production from Arcata, Ares and
Selene, 60% from Pallancata, 51% from San José and 70% from Moris.
2008 PRODUCTION BY MINE
ARCATA
+--------------------------+---------------+---------------+---------------+
| Product | Year ended 31 | Year ended 31 | % change |
| | December 2008 | December 2007 | |
+--------------------------+---------------+---------------+---------------+
| Ore production (tonnes) | 557,870 | 415,400 | 34% |
+--------------------------+---------------+---------------+---------------+
| Average head grade | 571.37 | 560.04 | 2% |
| silver (g/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Average head grade gold | 1.53 | 1.43 | 7% |
| (g/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Concentrate produced | 20,639 | 16,665 | 24% |
| (tonnes) | | | |
+--------------------------+---------------+---------------+---------------+
| Silver grade in | 13.94 | 12.12 | 15% |
| concentrate (kg/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Gold grade in | 0.04 | 0.03 | 33% |
| concentrate (kg/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Silver produced (koz) | 9,032 | 6,553 | 38% |
+--------------------------+---------------+---------------+---------------+
| Gold produced (koz) | 24.04 | 16.48 | 46% |
+--------------------------+---------------+---------------+---------------+
| Silver sold (koz) | 8,564.32 | 6,544 | 31% |
+--------------------------+---------------+---------------+---------------+
| Gold sold (koz) | 22.36 | 15.50 | 44% |
+--------------------------+---------------+---------------+---------------+
ARES
+-----------------------------------+--------------------+--------------------+--------------------+
| Product | Year ended 31 | Year ended 31 | % change |
| | December 2008 | December 2007 | |
+-----------------------------------+--------------------+--------------------+--------------------+
| Ore production (tonnes) | 347,910 | 333,800 | 4% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Average head grade silver (g/t) | 156.95 | 279.25 | (44%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Average head grade gold (g/t) | 6.06 | 14.57 | (58%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Doré total (koz) | 1,608 | 2,593 | (38%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Silver produced (koz) | 1,538 | 2,701 | (43%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Gold produced (koz) | 64.16 | 149.98 | (57%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Silver sold (koz)1 | 2,398.32 | 2,880 | (17%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Gold sold (koz)2 | 77.44 | 157.77 | (51%) |
+-----------------------------------+--------------------+--------------------+--------------------+
1Total sale figures for Ares include the sale of 746 koz of silver precipitates
from San José.
2 Total sale figures for Ares include the sale of 11.14 koz of gold precipitates
from San José.
SELENE
+--------------------------+---------------+---------------+---------------+
| Product | Year ended 31 | Year ended 31 | % change |
| | December 2008 | December 2007 | |
+--------------------------+---------------+---------------+---------------+
| Ore production (tonnes) | 269,150 | 413,622 | (35%) |
+--------------------------+---------------+---------------+---------------+
| Average head grade | 209.52 | 295.79 | (29%) |
| silver (g/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Average head grade gold | 1.21 | 2.01 | (40%) |
| (g/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Concentrate produced | 3,201 | 4,010 | (20%) |
| (tonnes) | | | |
+--------------------------+---------------+---------------+---------------+
| Silver grade in | 15.04 | 26.83 | (44%) |
| concentrate (kg/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Gold grade in | 0.08 | 0.17 | (53%) |
| concentrate (kg/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Silver produced (koz) | 1,579 | 3,414 | (54%) |
+--------------------------+---------------+---------------+---------------+
| Gold produced (koz) | 8.50 | 21.62 | (61%) |
+--------------------------+---------------+---------------+---------------+
| Silver sold (koz) | 1,928.77 | 3,644 | (47%) |
+--------------------------+---------------+---------------+---------------+
| Gold sold (koz) | 9.93 | 22.03 | (55%) |
+--------------------------+---------------+---------------+---------------+
PALLANCATA1
+--------------------------+---------------+---------------+---------------+
| Product | Year ended 31 | Year ended 31 | % change |
| | December 2008 | December 2007 | |
+--------------------------+---------------+---------------+---------------+
| Ore production (tonnes) | 468,125 | 78,335 | 498% |
+--------------------------+---------------+---------------+---------------+
| Average head grade | 312.18 | 310.02 | 1% |
| silver (g/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Average head grade gold | 1.49 | 1.49 | 0% |
| (g/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Concentrate produced | 4,265 | 638 | 568% |
| (tonnes) | | | |
+--------------------------+---------------+---------------+---------------+
| Silver grade in | 30.54 | 34.28 | (11%) |
| concentrate (kg/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Gold grade in | 0.12 | 0.13 | (8%) |
| concentrate (kg/t) | | | |
+--------------------------+---------------+---------------+---------------+
| Silver produced (koz) | 4,188 | 704 | 495% |
+--------------------------+---------------+---------------+---------------+
| Gold produced (koz) | 16.16 | 2.76 | 486% |
+--------------------------+---------------+---------------+---------------+
| Silver sold (koz) | 3852.09 | 550 | 600% |
+--------------------------+---------------+---------------+---------------+
| Gold sold (koz) | 14.81 | 2.03 | 630% |
+--------------------------+---------------+---------------+---------------+
1 The Company has a 60% interest in Pallancata.
SAN JOSE1
+-----------------------------------+--------------------+--------------------+--------------------+
| Product | Year ended 31 | Year ended 31 | % change |
| | December 2008 | December 2007 | |
+-----------------------------------+--------------------+--------------------+--------------------+
| Ore production (tonnes) | 295,963 | 92,974 | 218% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Average head grade silver (g/t) | 559.11 | 538.38 | 4% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Average head grade gold (g/t) | 6.69 | 7.08 | (6%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Silver produced (koz) | 4,381 | 958 | 357% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Gold produced (koz) | 54.26 | 14.96 | 263% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Silver sold (koz) | 4588 | 92 | 4894% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Gold sold (koz) | 57.70 | 1.49 | 3764% |
+-----------------------------------+--------------------+--------------------+--------------------+
1 The Company has a 51% interest in San José.
MORIS1
+-----------------------------------+--------------------+--------------------+--------------------+
| Product | Year ended 31 | Year ended 31 | % change |
| | December 2008 | December 2007 | |
+-----------------------------------+--------------------+--------------------+--------------------+
| Ore production (tonnes) | 876,148 | 338,304 | 159% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Average head grade silver (g/t) | 5.71 | 4.69 | 22% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Average head grade gold (g/t) | 1.57 | 1.65 | (5%) |
+-----------------------------------+--------------------+--------------------+--------------------+
| Silver produced (koz) | 65.07 | 12.63 | 415% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Gold produced (koz) | 26.847 | 5.5795 | 381% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Silver sold (koz) | 68.27 | 6.44 | 960% |
+-----------------------------------+--------------------+--------------------+--------------------+
| Gold sold (koz) | 28.01 | 3.26 | 760% |
+-----------------------------------+--------------------+--------------------+--------------------+
1 The Company has a 70% interest in Moris.
Glossary
Ag
Silver
Adjusted EBITDA
Adjusted EBITDA is calculated as profit from continuing operations before
exceptional items, net finance costs and income tax plus depreciation,
amortization and exploration expenses other than personnel and other expenses
Au
Gold
Attributable after tax profit
Profit for the year before dividends attributable to the equity shareholders of
Hochschild Mining plc from continuing operations before exceptional items and
after minority interest
Average head grade
Average ore grade fed into the mill
Board
The board of directors of the Company
Company, Group or Hochschild
Hochschild Mining plc and its subsidiary undertakings
CSR
Corporate social responsibility
Cu
Copper
Directors
The directors of the Company
Doré
Doré bullion is an impure alloy of gold and silver and is generally the final
product of mining and processing; the doré bullion will be transported to be
refined to high purity metal
Dollar or $
United States dollars
Effective Tax Rate
Income tax expense as a percentage of profit from continuing operations before
income tax
EPS
The per-share (using the weighted average number of shares outstanding for the
period) profit available to equity shareholders of the Company from continuing
operations before exceptional items
eq
equivalent
Exceptional item
Events that are significant and which, due to their nature or the expected
infrequency of the events giving rise to them, need to be disclosed separately
GAAP
Generally Accepted Accounting Principles
g/t
Grams per metric tonne
IAS
International Accounting Standards
IASB
International Accounting Standards Board
IFRS
International Financial Reporting Standards
JV
Joint venture
koz
Thousand ounces
kt
Thousand metric tonnes
ktpa
Thousand metric tonnes per annum
Listing or IPO (Initial Public Offering) or Global Offer
The listing of the Company's ordinary shares on the London Stock Exchange on 8
November 2006
moz
Million ounces
Ordinary Shares
Ordinary shares of GBP0.25 each in the Company
Pb
Lead
Spot or spot price
The purchase price of a commodity at the current price, normally this is at a
discount to the long term contract price
t
tonne
Zn
Zinc
This information is provided by RNS
The company news service from the London Stock Exchange
END
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