Pre-feasibility study confirms 3.1 Moz Reserve at Wits Gold’s flagship DBM Project

NEWS RELEASE.

June 13, 2012: Johannesburg, South Africa – Witwatersrand Consolidated Gold Ltd. (Wits Gold – Stock Profile – TSX:WGR) announced the completion of a positive pre-feasibility study (PFS) on its De-Bron Merriespruit (DBM) Project, situated in the southern Free State goldfield of the Witwatersrand Basin. Among the positive developments that were highlighted by the PFS was the delineation of a Probable gold Reserve of 23.5Mt at a grade of 4.05g/t Au (3.1Moz). These Reserves are contained within the Project’s Indicated Resources of 26.7Mt at 5.8g/t Au (4.99 Moz).

Summary of PFS highlights:

  • Indicated Resource of 26.7Mt at 5.8g/t Au (4.99 Moz), containing Reserves of 23.5Mt at 4.05g/t Au (3.1 Moz).
  • Average annual gold production of 200 000oz  over an 18-year life of mine.
  • Production cash costs of US$628/oz.
  • First gold production 47 months after shaft sinking commences.
  • Peak capital funding of ZAR2.37 billion (US$296 million at ZAR8/US$)
  • At ZAR400 000/kg Au (US$1 555/oz & ZAR8/US$) pre-tax NPV(5%) ZAR7.3 billion (US$909 million), IRR 28.0%.
  • Shallow underground mine design comprising a twin shaft system to 660 metres.
  • Semi-mechanised option increases IRR to 30.9% (at the above prices) and pre-tax NPV(5%) to ZAR10.2 billion (US$1.3 billion).
  • Additional shallow Inferred Resources of 5.97Mt at 5.7g/t Au (1.1Moz) readily mineable from current mine design – this will be prioritised during feasibility drilling.
Wits Gold CEO, Philip Kotze, commented: “We completed the PFS on time and budget and are  pleased with the results, which have confirmed that a mine  at DBM is both economically and technically viable. Each step of our project advancement has taken us closer towards confirming our confidence that the DBM Project will indeed become South Africa’s next shallow gold mine.”
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