LIHIR GOLD LIMITED ARBN 069 803 998
Incorporated in Papua New Guinea
(Quarterly report for the three months ended 30 September 2009. All dollar figures refer to US dollars.)
29 October 2009
Third Quarter Production Report 2009 Page 1 of 13
Production Report
THIRD quaRTeR 2009
Production Summary (Ozs)
Operation
March qtr 09
June qtr 09
Sept qtr 09
YTD
Lihir Island, PNG
246,711
219,436
169,133
635,280
Mt Rawdon, QLD
25,500
28,952
30,409
84,861
Bonikro, Côte d'lvoire*
40,100
43,607
31,896
115,603
Ballarat, VIC
5,687
2,029
1,908
9,624
Total
317,998
294,024
233,346
845,368
*Bonikro production reported on a 100% basis
Group Overview
· Quarterly production of 233,346 ozs, in line with guidance.
· Year to date production of 845,368 ozs, well on track to
meet full year production guidance of 1-1.2 million ozs.
· Dividend distributions to commence. Interim dividend of
US1.5 cents per share to be paid on November 30.
· Lihir Island reserves increased by 7.5 million ozs to
28.8 million ozs.
· Total cash costs for the nine months to September at
$378/oz (excluding Ballarat), on track for full year total
cash costs to remain below $400/oz.
· Lihir Island Million Ounce Plant Upgrade continues on
schedule and budget.
Page 2 of 13
Strong production
performance, rising
cashflows, a solid
financial position and
positive outlook for the
future have enabled
LGL to commence
payment of dividends
to shareholders.
Managing Director's Review
Strong production performance, rising cashflows, a solid
financial position and positive outlook for the future have
enabled Lihir Gold Ltd (LGL) to commence payment of
dividends to shareholders.
The decision marks a major milestone in the development
of the group, and reflects the strong progress achieved
in rebuilding and reshaping the company over the past
four years.
The improved reliability of production at Lihir Island,
coupled with diversified income streams created by
operating mines in three countries and the strengthening
of the company's balance sheet over recent years have
provided the basis for the decision.
An interim dividend of US1.5 cents per share will be
paid on November 30, and the company aims to sustain
dividend payments into the future. In addition, following
the global financial crisis the company is progressing with
the establishment of long term core debt facilities that will
provide further financial flexibility and may enable a return
of capital to shareholders in the future.
The announcement of the dividend coincides with a
Reserve upgrade at Lihir Island, which has resulted in a
36% increased in contained gold to 28.8 million ounces.
The 7.5 million ounce increase is equivalent to the total
production for Lihir Island over the 12 years since the
start of operations, and confirms the deposit as one of the
world's largest.
The Reserve increase follows the 10 million ounce rise
in Measured and Indicated Resources announced in
August, which was mainly due to successful drilling results
identifying significant new areas of mineralisation.
The expansion of the Reserve again demonstrates the
remarkable nature of the Lihir ore body, which continues
to present additional gold over time as we test the limits
of the deposit. The Reserve increase confirms the Lihir
operation will continue to produce well beyond the next
two decades, generating significant wealth for the PNG
economy and the Lihirian community, and providing
increasing returns for shareholders.
Third Quarter Production Report 2009 Page 3 of 13
Third quarter Production Overview
LGL achieved production of 233,000 ounces in the third
quarter of 2009, taking output for the first nine months of
the year to 845,000 ounces and leaving the group on track
to achieve record full year production of more than 1 million
ounces.
At Lihir Island, total output was 169,000 ounces. While
lower than the prior quarter, this was due to routine plant
maintenance which had been scheduled for the third
quarter. Production for the quarter was above guidance,
with plant throughputs exceeding plan and again
demonstrating the step change in performance achieved in
recent years.
The Million Ounce Plant Upgrade project remains on
schedule and within budget. The project should see
annual production at the Island increase to an average of
one million ounces from 2012. Relocation of pre-existing
buildings on the plant site is close to completion and
earthworks have commenced.
In Côte d'Ivoire, production at the Bonikro operation
totalled 32,000 ounces for the quarter, which was down
on the prior quarter due to the transitioning of mining and
processing from oxide ore to fresh, hard rock. This resulted
in reduced mill throughputs in the quarter as refinements
were being made to the process plant operations to cope
with the different ore characteristics.
Good progress was made on the feasibility study
examining the development of satellite mines at Hiré,
around 10 kilometres from the Bonikro plant. Ore will be
trucked to Bonikro for processing, with initial indications
that the higher grade Hiré ore will enable Bonikro output
to increase to 200,000 oz per year with minimal additional
capital investment in the plant.
Meanwhile, exploration activities in Côte d'Ivoire continue
to deliver promising results, with diamond drilling now
being carried out at Didiévi following encouraging soil
sampling and RC drilling programs.
In Australia, the Mount Rawdon operation in Queensland
lifted output to 30,400 ounces in the quarter, maintaining
its consistent track record. And at Ballarat, the process
for the sale of the operation proceeded, with a number of
attractive indicative offers received to date. The sale should
be completed early in the New Year.
Financial Overview
Gold sales totalled 221,000 ounces for the quarter, at an
average realised cash price of $955/oz, up from $900/oz in
the three months to June. For the nine months to the end
of September, 834,000 ounces were sold at an average
price of $906/oz. Gross cash margins for the year to date
were healthy at $421/oz, excluding Ballarat.
Outlook
Full year production for 2009 remains unchanged at 1.0
1.2 million oz. This will include production of 770,000
840,000 oz from Lihir Island, approximately 130-160,000
oz from Bonikro and 90-100,000 oz from Mt Rawdon.
The full year contribution from Ballarat is expected to be
approximately 14,000 oz.
Total cash costs per ounce are forecast to remain below
$400 per ounce for the year, excluding Ballarat.
I look forward to reporting further operating and financial
improvements as the year progresses.
ARTHUR HOOD
Managing Director
Operations
PRODUCTION STATISTICS
Page 4 of 13
Third
Second
First
Change
YTD
Quarter
Quarter
Quarter
Q3 vs Q2
2009
2009
2009
2009
Lihir Island
Mining
High grade ore mined
kt
4,429
1,398
1,630
1402
-14%
Economic grade ore mined
kt
4,243
1,677
1,655
911
1%
Material moved
kt
34,235
10,999
12,132
11,104
-9%
Processing
Ore milled
kt
4,594
1,442
1,561
1,591
-8%
Autoclave feed
kt
3,459
1,055
1,210
1,194
-13%
Autoclave grade
Au g/t
6.66
5.99
6.64
7.27
-10%
Recovery
%
81.6
78.8
81.8
83.6
-4%
Gold poured
oz
635,280
169,133
219,436
246,711
-23%
Mt Rawdon
Mining
Ore mined
kt
2,488
886
811
791
9%
Material moved
kt
8,321
3,020
2502
2799
21%
Processing
Ore milled
kt
2,485
829
835
821
-1%
Ore grade
Au g/t
1.18
1.25
1.19
1.09
5%
Gold recovery
%
90.7
91.7
90.5
89.9
1%
Gold poured
oz
84,861
30,409
28,952
25,500
5%
Silver poured
oz
141,709
53,978
48,180
39,551
12%
Bonikro
Mining
Ore mined
kt
1,740
647
572
520
13%
Material moved
kt
8,187
3,873
2,657
1,657
46%
Processing
Ore milled
kt
1,530
426
570
534
-25%
Ore grade
Au g/t
2.37
2.39
2.42
2.31
-1%
Gold recovery
%
95.1
95.8
96.7
92.8
-1%
Gold poured
oz
115,603
31,896
43,607
40,100
-27%
Ballarat
Mining
Underground Development
mtrs
3,795
452
1,171
2,172
-61%
Processing
Gold poured
oz
9,624
1,908
2,029
5,687
-6%
LGL Group
Production
oz
845,368
233,346
294,024
317,998
-21%
Gold production at Lihir
in the quarter totalled
169,000 ounces, which
was above guidance.
LIHIR ISLAND
Mining
Material movements in the quarter totalled 11 million
tonnes, which was 9% lower than the prior quarter due to
unusually heavy rainfall in July, which averaged 27mm per
day, compared with an annual average of approximately
15mm. The increased rain affected haul road conditions
and reduced bench turnover rates. Low drill availability in
the quarter also caused shortages of blasted stock and led
to lower tonnages of high grade ore.
Material movements improved in September, enabling
ore to be exposed in the next phase of the pit. Pioneering
of the next pit, to mine the Kapit section of the ore body,
is now well under way with mining supplied by local
landowner companies. Ore production from Kapit is
forecast to commence after 2012.
Processing
Gold production in the quarter totalled 169,000 ounces,
which was above guidance for the quarter. Process plant
operating times were reduced by the routine total plant
shutdown for maintenance purposes. Scheduled to take
12-14 days, the TPS was successfully completed in
11.2 days. In addition, a full rebrick of one of the plant's
three autoclaves, scheduled once every 10 years, was
completed in the quarter. Scheduled to take 55 days, the
rebrick was finished in 42 days.
While the maintenance work led to lower production for the
quarter, underlying operating parameters remained strong.
Ore milled per operating hour was well up on the prior
quarter, and autoclave throughputs achieved a new record
at 222 tonnes per hour per autoclave, up from 208 tonnes
in the three months to June.
Gold grade of autoclave feed remained high, at 6.0 g/t, but
below the prior quarter (6.6 g/t) due mainly to slightly lower
grade of ore supplied from the pit. The average grade of
milled ore was 4.7 g/t, compared with 5.3 g/t in the prior
quarter. Feed to the autoclaves was 1.1mt, which included
257kt of flotation concentrate at a gold grade of 9.8 g/t.
Recovery rates reduced slightly due to higher throughput
rates, increased flotation and lower grade ore processed.
Third Quarter Production Report 2009 Page 5 of 13
LIHIR ISLAND continued
Million Ounce Plant upgrade and Interim Power
Station project
The Million Ounce Plant Upgrade and Interim Power Station
project continues on schedule for completion by the end of
2011 and remains on budget. Expenditure commitments to
date total $315 million, including $142 million in cash outlaid.
Relocation of existing infrastructure is close to completion,
ground works are well advanced to enable civil works to
commence before the end of November, and wharf upgrade
construction is under way.
exploration
Exploration at Lihir Island during the quarter was focused
on west Minifie and the area between the Lienetz pit and
the proposed Kapit pit. Four diamond drill holes were drilled
in the quarter. Significant intersections are included below.
Page 6 of 13
Hole ID
EAST
NORTH
RL
Azmiuth
Dip
TD
From
To
Au g/t
S%
Interval
DDHL1565
9387.21
4796.34 1068.804
180
-85
270
14
18
3.13
6.96
4m @ 3.13g/t Au & 6.96% S
112
126
2.43
3.75
14m @ 2.43g/t Au & 3.75% S
134
166
2.18
4.22
32m @ 2.18g/t Au & 4.22% S
196
208
1.54
4.29
12m @ 1.54g/t Au & 4.29% S
252
258
3.01
3.68
6m @ 3.01g/t Au & 3.68% S
266
270
4.01
3.29
4m @ 4.01g/t Au & 3.29% S
DDHL1566
9494.24
4756.16 1065.231
180
-85
270
7.0
22
3.88
7.82
15m @ 3.88g/t Au & 7.82% S
146
150
2.71
9.25
4m @ 2.71g/t Au & 9.25% S
162
174
1.34
7.90
12m @ 1.34g/t Au & 7.9% S
200
236
2.82
1.55
36m @ 2.82g/t Au & 1.55% S
264
288
1.51
1.52
24m @ 1.51g/t Au & 1.52% S
DDHL1567
9496.20
4756.52 1065.235
180
-80
300
64
76
2.56
6.88
12m @ 2.56g/t Au & 6.88% S
124
164
2.01
4.34
40m @ 2.01g/t Au & 4.34% S
176
180
2.11
5.29
4m @ 2.11g/t Au & 5.29% S
190
298
2.88
3.62
108m @ 2.88g/t Au & 3.62% S
DDHL1570
9249.39
3279.10
957.818
180
-65
200
42.0
54
2.83
7.18
12m @ 2.83g/t Au & 7.18% S
64
70
2.88
5.61
6m @ 2.88g/t Au & 5.61% S
90
110
3.14
5.23
20m @ 3.14g/t Au & 5.23% S
120
126
1.63
4.64
6m @ 1.63g/t Au & 4.64% S
134
138
4.66
4.47
4m @ 4.66g/t Au & 4.47% S
SIGNIFICANT INTERSECTIONS
Mt Rawdon continued to
demonstrate its consistent,
low risk performance, with
total gold production in the
quarter of 30,000 ounces.
Third Quarter Production Report 2009 Page 7 of 13
MT RAWDON
Mt Rawdon continued to demonstrate its consistent, low
risk performance, with total gold production in the quarter of
30,409 ounces, which was up 5% on the prior period. The
increase was primarily due to higher gold grades, at 1.25 g/t,
and improved recovery rates. Mill throughputs were steady at
829,000 tonnes. Material movements increased significantly
due to improved equipment availability and changes to the pit
which increased operating areas and improved efficiency.
A total of 53,978 ounces of silver were poured in the quarter,
compared with 48,180 ounces in the prior three months to
June, with the increase due to higher silver grades.
BONIKRO
Mining and processing operations at Bonikro were focused
on managing the transition from softer oxide ore to hard rock.
Mining benefited from the transition, with operating conditions
improved due to less boggy ground, enabling more efficient
loading and operation of trucks. Lower rainfall, together with
establishment of all-weather road surfaces, resulted in less
truck downtime. Revised mine planning led to improvements
in pit sequencing and optimised haul distances, and training
of truck operators also advanced in the quarter.
Overall material movements increased to 3.9 million tonnes
in the quarter, up 46% on the prior three months to June.
In the process plant, the transition to hard rock led to a
reduction in throughputs, which fell 25% to 426,000 tonnes.
Mill settings are being adjusted to improve efficiency and lift
throughput. Grade remained steady at 2.39 g/t.
COTE D'IVOIRE ExPLORATION AND
DEVELOPMENT
Exploration in Cote d'Ivoire continued to generate
encouraging results in the September quarter.
A total of 64,900 metres of drilling was completed over 17
target areas in the quarter, producing more than 119,000
assay results.
Oumé
In the Oumé permit, which surrounds the Bonikro mine and
includes the Dougbafla prospects approximately 15 klms
north of Bonikro, extensive exploration was carried out. At
Bonikro, exploration drilling was aimed at delineating the
Bonikro Deeps resource, which extends beneath and to the
west of the current Bonikro pit. A program of 14 holes was
completed during the quarter, with full assay results pending.
In the Hiré permit, which
borders Oumé in Côte
d'lvoire, extensive exploration
work has been aimed at
identifying potential satellite
deposits.
Page 8 of 13
Oumé continued
Current resource at Bonikro totals 1.05 million ounces in the
measured and indicated category, and 318,000 ounces in
inferred.
In addition, an updated resource estimate was released
for Dougbafla East prospect. A significant upgrade to the
previously announced 150,000 contained Inferred ounces
was achieved. The current indicated resource now totals
217,000 ounces, with an additional 15,000 ounces contained
within the inferred category.
Hiré
In the Hiré permit, which borders Oumé, extensive
exploration work has again been aimed at identifying
potential satellite deposits. These deposits are approximately
10 kilometres to the south-east of the Bonikro plant.
During the quarter resource estimates were released for
Akissi-So, Assondji-So, Agbalé, and Chappelle prospects.
The current indicated resource at Hiré now totals 442,000
ounces, with an additional 450,000 ounces contained within
the inferred category.
The company has continued work on a pre-feasibility study to
establish a satellite operation at Hiré, with ore to be trucked
to Bonikro for processing. Initial social and environmental
impacts are being assessed.
Exploration work continued in the quarter focussed on
delineating mineralisation at new targets, as well as
extending known mineralisation at existing prospects.
Didiévi
At Blaffo Guetto, in the Didiévi permit, approximately 70
kilometres to the north of Bonikro, prospects for a new
stand-alone mine continued to improve as drilling results
confirmed significant mineralisation over a strike length of
1.8 kilometres. A total of 2,879 assay results were received
from 32 RC holes as well as from the first Diamond drill hole
completed on the prospect. Approximately 7,000 metres of
RC drilling was carried out in the quarter. Results received
from DDD001 were very encouraging returning a high
grade intercept of 20m at 11.19gAu/t. The hole also ended
in mineralisation. Full details of Blaffo Guetto significant
intercepts are included at the end of this report.
Tienougoue
Results from a first pass regional soil sampling programme
identified a large soil anomaly 5.5km by 4.3km in extent.
Infill sampling is planned for Q4 2009.
Third Quarter Production Report 2009 Page 9 of 13
Financial Data
SALES
YTD
Sept
2009
Third
Quarter
2009
Second
Quarter
2009
First
Quarter
2009
Change
Q3 vs Q2
Lihir Island
Gold sold
Oz
627,026
161,630
240,046
225,350
-33%
Price spot
$/oz
926
954
922
910
3%
Gross cash cost
$/oz
488
694
468
365
48%
Total cash costs
$/oz
376
521
345
303
51%
Mount Rawdon
Gold sold
Oz
84,680
30,737
28,606
25,337
7%
Price spot
$/oz
931
960
924
905
41%
Gross cash cost
$/oz
421
455
403
402
13%
Total cash costs
$/oz
380
404
381
351
6%
Bonikro
Gold sold
Oz
112,160
27,806
49,123
35,231
-43%
Price spot
$/oz
929
958
923
915
4%
Gross cash cost
$/oz
412
516
396
345
30%
Total cash costs
$/oz
390
387
396
385
-2%
LGL Group
Gold sold
Oz
834,324
220,715
321,505
292,105
-31%
Price - spot
$/oz
927
955
922
910
4%
Price realized cash
$/oz
906
955
900
876
6%
Gross cash cost*
$/oz
471
638
451
365
41%
Total cash costs*
$/oz
378
487
356
318
37%
* Group unit cash costs have been overstated for Q1 and Q2 and have been restated down for a translation adjustment in those periods.
Total cash costs for the group for the quarter were $487/
oz (excluding Ballarat), which was higher than normal due
to the impact of the planned maintenance shutdown at Lihir
Island, which reduced output and therefore lifted unit costs.
In absolute terms, total cash costs for the group (excluding
Ballarat) increased 8% to $113 million for the quarter, with the
increase partly due to the falling US dollar, which contributed
to higher costs at Lihir Island and Mt Rawdon. The average
Australian dollar exchange rate increased to US83c for the
quarter, compared with US76c in the prior three months.
For the nine months to the end of September, total cash costs
for the group remain very competitive, at $378/oz, and on
track to remain below $400/oz for the full year.
At Lihir Island, total cash costs for the September quarter
increased significantly due to the planned plant maintenance
program. For the nine months to September, total cash costs
remained low at $376/oz, positioning the project among the
world's lower cost gold producers.
Mining costs at Lihir Island increased marginally in the quarter
due primarily to the higher Australian dollar, which drove up
US dollar costs, particularly for expatriate workers. Diesel
prices also rose approximately 17%, and diesel consumption
increased slightly. Power costs rose due to higher prices for
HFO, which increased 6% , and consumption increased 8%.
At Mt Rawdon, total cash costs remained competitive at
US$404/oz. Costs were adversely affected by the strengthening
Page 10 of 13
HOLE ID
EASTING
NORTHING
FROM
TO
INTERVAL
(m)
Au (g/t)
DRC156
279916
749536
62
72
10
4.31
DRC157
279892
749556
35
37
2
4.85
46
47
1
3.5
82
84
2
1.3
DRC158
279854
749601
0
2
2
0.85
30
31
1
2.18
DRC160
279894
749490
15
18
3
2.16
24
25
1
2.5
48
45
3
2.14
59
66
7
3.84
DRC161
279852
749460
1
4
3
0.88
52
56
4
1.75
63
72
9
6.86
DRC162
279832
749484
3
10
7
2.36
73
77
4
4
85
92
7
0.55
DRC163
279809
749505
8
11
3
0.83
53
55
2
1.1
64
65
1
1.17
76
78
2
1.21
DRC164
279774
749540
11
22
11
1.04
29
31
2
1.19
50
57
7
1.62
69
75
6
1.16
79
84
5
2.82
89
92
3
2.17
DRC165
279752
749562
10
15
5
0.84
53
64
11
1.47
78
80
2
1.12
87
90
3
0.87
DRC169
279697
749475
67
82
15
1.12
DRC172
279690
749340
6
23
17
2.04
90
91
1
3.93
DRC173
279669
749359
60
64
4
1.12
80
86
6
2.83
DRC175
279612
749419
63
65
2
1.75
DRC186
279506
749237
3
6
3
1.1
DRC205
279566
748264
68
75
7
3.15
DDD001
279721
749520
22
32
10
0.83
40
52
12
0.63
68
71
3
1.41
99
102
3
1.57
107
111
4
0.59
125
126
1
2.17
132.2
135
2.8
1.97
186
206
20
11.19
212
223.1
11.1
2.94
Australian dollar in the quarter. Absolute total cash costs
in US dollars increased 11 percent to $12.3 million for the
quarter. But in Australian dollars, absolute total cash costs
increased by 1% to $14.8 million.
At Bonikro, total cash costs reduced to $387/oz from $396/oz
in the prior period. In absolute terms, this represented a 28%
reduction in costs to $12.4 million. The reduction in costs was
partly due to increased cost deferrals in the period, as mining
completed significant waste stripping. Aggregate costs also
were lower due to reduced plant throughputs.
INTERIM DIVIDEND
An interim dividend of US1.5 cents per share will be paid on
November 30, to all shareholders registered at the close of
business on November 9.
Lihir Gold Limited's dividend payment can be made by way of
direct credit to nominated Australian financial institution accounts
only. To receive dividend payments by direct credit, shareholders
should visit
www.computershare.com.au/easyupdate/lgl
to provide their Australian financial institution account details.
Shareholders who have not provided financial institution
account information by 8th November 2009 will receive their
dividend by way of cheque.
Further Information
Q3 SIGNIFICANT INTERCEPTS BLAFFO GUETTO
Third Quarter Production Report 2009 Page 11 of 13
Third Quarter Production Report 2009 Page 11 of 13
Further Information
CONTACT FOR INVESTOR INFORMATION
Joe Dowling
GM Corporate Affairs
Tel: +61 7 3318 3308
Mobile: +61 421 587 755
email: joe.dowling@lglgold.com
Joel Forwood
Manager Investor Relations
Tel: +61 7 3318 3331
Mobile: +61 438 576 879
email: joel.forwood@lglgold.com
Web site: www.LGLgold.com
SHAREHOLDER ENQUIRIES
Queries related to share registry matters
should be directed to:
Computershare Investor Services
Level 19, 307 Queen Street
Brisbane, Queensland 4000 Australia
Tel: 1300 552 270 or +61 7 3237 2100
Fax: +61 7 3237 2152
Web site: www.computershare.com
email: web.queries@computershare.com.au
ADR DEPOSITARY
The Bank of New York
Depositary Receipts Divison
101 Barclay St, 22
nd
Floor
New York, New York 10286 USA
Tel: +1 212 815 3700
Fax: +1 212 571 3050
Web site: www.adrbny.com
PRINCIPAL OFFICE
Level 7, Pacific Place
Cnr Champion Parade & Musgrave Street
Port Moresby, Papua New Guinea
CORPORATE OFFICE
Level 9, 500 Queen Street
Brisbane, Queensland 4000 Australia
STOCK ExCHANGE LISTINGS
Australian Securities Exchange (LGL)
NASDAQ National Market (LIHR)
Port Moresby Stock Exchange (LGL)
Toronto Stock Exchange (LGG)
ISSUED CAPITAL
The current ordinary issued capital of the company is:
·
2,368,729,935 listed ordinary shares (including
1,046,662 restricted executive shares)
·
161,527,405 class B shares
DIRECTORS
Ross Garnaut Chairman
Arthur Hood Managing Director
Bruce Brook
Peter Cassidy
Mike Etheridge
Winifred Kamit
Geoff Loudon
Alister Maitland
GROUP SECRETARY
Stuart MacKenzie
Page 12 of 13
Forward Looking Statements
This document may contain certain forward-looking
statements, including but not limited to (i) estimated
reserves, (ii) anticipated production profiles and
characteristics, (iii) expected capital requirements, (iv)
forecast cost profiles or (iv) plans, strategies and objectives
of management. Such forward looking statements are not
guarantees of future performance and involve known and
unknown risks, uncertainties and other factors, many of
which are beyond the control of Lihir Gold Limited ("LGL"),
which may cause actual results to differ materially from those
contained in this announcement. Important factors that could
cause actual results to materially differ from the forward
looking statements in this presentation include but are not
limited to the market price of gold, anticipated ore grades,
tonnage, recovery rates, production and equipment operating
costs, the impact of foreign currency exchange rates on cost
inputs and the activities of governmental authorities in Papua
New Guinea and elsewhere, as set forth more fully under the
caption "Risk Factors" in LGL's most recent Annual Report
on Form 20-F, which has been filed with the US Securities
and Exchange Commission ("SEC").
Gold reserve and resource estimates are expressions of
judgement based on knowledge, experience and industry
practice, and may require revision based on actual
production experience. Such estimates are necessarily
imprecise and depend to some extent on statistical
inferences and other assumptions, such as gold prices,
cut-off grades and operating costs, which may prove to
be inaccurate. LGL's wholly owned subsidiary Ballarat
Goldfields Pty Ltd does not have any ore reserves and the
level of its estimated mineral resources and exploration
potential are necessarily imprecise and may prove to be
inaccurate. Accordingly, no assurance can be given that the
indicated amount of gold will be recovered or at the rates
estimated.
LGL can therefore give no assurances that any of the
estimates, production profiles, capital, cost profiles and plans
will not materially differ from the statements contained in this
release and their inclusion in this document should not be
regarded as a representation by any person that they will be
achieved.
The foregoing material is a presentation of general
background information about LGL's activities as of the date
of the presentation. It is information given in a summary
form and does not purport to be complete. It is not intended
to be relied upon as advice to investors or potential investors
and does not take into account the investment objectives,
financial situation or needs of any particular investor. These
should be considered, with or without professional advice
when deciding if an investment is appropriate.
Some of the information contained in this document
includes certain un-audited non-GAAP (where GAAP means
"generally accepted accounting principles") measures, such
as "cash costs". Such unaudited non-GAAP measures are
intended to provide information about the cash generating
capacity and performance of LGL's mining operations. In
particular, cash costs is a measure that is used in the gold
mining industry and was developed in conjunction with
gold mining companies associated with the Gold Institute
in an effort to provide a level of comparability. However,
LGL's measures may not be comparable to similarly titled
measures of other companies.
Management uses this measure for the same purpose
when monitoring and evaluating the performance of LGL.
This information differs from measures of performance
determined in accordance with GAAP and should not be
considered in isolation or as a substitute for measures of
performance determined in accordance with GAAP.
LGL Competent Person Statement
The information in this report that relates to Exploration
Results and Mineral Resources at Lihir, Côte d'Ivoire, and Mt
Rawdon is based on information compiled by Mr Roy Kidd.
Mr Kidd is a member of the Australian Institute of
Geoscientists and is a full time employee of Lihir Services
Australia Pty Ltd (LSA) in the role of Principal Geologist.
LSA provides services to LGL pursuant to a Managed
Services Agreement. Roy Kidd has sufficient experience
which is relevant to the style of mineralisation and the type
of deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined in
the 2004 Edition of the "Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves".
Roy Kidd consents to the inclusion in the report of the
matters based on his information in the form and context in
which it appears.
The information in this report that relates to Ore Reserves
at Lihir Island is based on information compiled by Mr David
Grigg.
David Grigg is employed by Lihir Gold Limited in the role of
Superintendent Mine Planning for the company. David Grigg
has sufficient experience, which is relevant to the style of
mineralisation and the type of deposit under consideration
and to the activity which he is undertaking to qualify as a
Competent Person as defined in the 2004 Edition of the
"Australasian Code for Reporting of Mineral Resources and
Ore Reserves". David Grigg consents to the inclusion in the
report of the matters based on their information in the form
and context in which it appears.
Note to u.S. Investors
Cautionary Note to U.S. Investors The United States
Securities and Exchange Commission permits U.S. mining
companies, in their filings with the SEC, to disclose only
those mineral deposits that a company can economically
and legally extract or produce. LGL uses certain terms on
this website, such as "measured," "indicated," and "inferred"
"resources," which the SEC guidelines strictly prohibit U.S.
registered companies from including in their filings with
the SEC. U.S. Investors are urged to consider closely the
disclosure in LGL's most recent Form 20-F, which may be
secured from LGL, or from the SEC's website at www.sec.
gov/edgar.shtml.
Note to Canadian Investors
Canadian Investors for further information in relation
to the calculation of reserves and resources with respect
to LGL's Lihir operation, please refer to the Lihir Gold
Limited (TSx:LGG) Technical Report (NI 43-101) dated 18
September 2007 available on SEDAR (www.sedar.com).
Third Quarter Production Report 2009 Page 13 of 12
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