Exploration Activities

Q3 coincides with the annual wet season in West Africa and it is a time when field activities cease. Consequently, the emphasis of exploration work is on the receipt of results, their integration and interpretation, together with planning of future programmes and budgets.


MALI

Gounkoto

At Gounkoto, an updated geological model, based on the results of the deep drilling beneath the Gounkoto pit shell, has been completed and will allow a new resource estimate to be calculated leading to an updated scoping study where an open pit underground interface will be determined. Drilling confirmed the existence of a high grade lode at depth in the Jog Zone and the potential for two million ounces at 5.3g/t.

One objective has been to identify additional potential beneath the existing block model. The structural complexity, due to folding and faulting in the area, may mean that faulted blocks of mineralisation are present at depth beneath the deposit. The programme highlighted the potential at depth to the north of Gounkoto where wide low grade intersections such as GKDH292 - 86.10 metres at 1.12g/t from 704 metres and GKDH298 - 47.5 metres at 1.46g/t from 429 metres confirm that the system is still open. This potential will be further tested in Q4 this year.


Faraba

The rigs returned to Faraba for the first time in several years and four holes were drilled to infill gaps within the block model and to twin old RC holes to provide additional statistical data for resource estimation purposes. Results from this work returned a close correlation with the results from previous RC drilling and infill holes confirmed the continuity of the mineralisation within the US$1 200 pit shell where an inferred resource of 540 000 ounces at 2.62g/t has been estimated. Two holes returned a newly identified broad zone of footwall mineralisation FADH 177 - 91 metres at 1.53g/t from 232 metres and FATWDH04 - 39.5 metres at 1.3g/t from 187.8 metres. This represents an additional opportunity at Faraba for further targeting.


Gounkoto region

Ongoing work in the Gounkoto region returned good drill intersections at Toronto South, further defining a deep zone of mineralisation with a strike continuity, so far, of 430 metres: FRDH012 - 16 metres at 2.41g/t from 211 metres and FRDH018 - 24 metres at 2.17g/t from 219 metres and 19.6 metres at 3.36g/t from 264.1 metres.

The system remains open along strike and at depth and programmes are currently being designed to further scope out this target. To the north of Gounkoto, hole FRDH020 returned 3.5 metres at 5.57g/t from 133.5 metres associated with massive pyrite and tourmalinised greywacke.


Loulo

At Loulo, extensive modelling of the structures drilled out during Q2 produced new wireframes for the Yalea structure, Baboto, Loulo 3, P125-L3 and PQ10S. These models are all contributing to the longer term pipeline of mineable resources around the Loulo plant including a heap leach opportunity for low grade ore. During Q4, a number of these targets will be drilled out to allow their conversion into measured and indicated resources.


Loulo Underground

Underground drilling at Loulo targeted the low-grade patch to the south of the Yalea North plunge and infill drilling within the ‘purple patch’. This drilling indicated the continuity of the high grade plunge albeit at slightly narrower widths but increased grade (4.96 metres at 6.45g/t compared to 12 metres at 3.42g/t in the model). In the ‘purple patch’results confirmed the good widths and grades in the block model with an average weighted intersection of 18.7 metres at 9.12g/t. At Gara, drilling of the fold nose confirmed the widths in the block model but at a slightly lower average grade of 3.65g/t compared to 4.8g/t.

This work has already produced results with the remaining in pit inferred resource (US$1 000/oz) at Loulo 3 being estimated at 191 794 ounces at 3.90g/t. This is being incorporated into a trade-off study with Yalea South where the remaining open pit indicated mineral resource (US$1 000/oz is 127 596 ounces at 5.12g/t. An additional potential of 1.07 million ounces at 3.95g/t exists beneath the pit. At P125-L3, infill drilling at 25 metres confirmed the potential for 43 364 ounces at 2.93g/t within a larger inferred resource of 116 207 ounces at 2.72g/t. At Baboto, a geological estimate of all three zones of mineralisation (north, centre and south) returned a global resource potential of 464 000 ounces at 2.32g/t. In the southern zone there is a higher grade zone, down to 50 metres vertical depth which returns 147 000 ounces at 3.01g/t.


Bambadji

A new GIS prospectivity analysis incorporating new field mapping, soil geochemical grids and geophysical data has identified new targets which have been prioritised for follow-up work as the new field season commences. The emphasis is on testing the main north-south structure which hosts both Yalea and Gounkoto deposits but on the Bambadji permit is covered by transported gravels from the Falémé River system.


Mali South

Exploration work this quarter has focused on receiving and interpreting results from the regional soil survey (1 kilometre by 200 metres) across the Nimisilla JV groundholding and the Dinfola permit, in the Bougouni area in Mali South. The area features the intersection of a NE belt parallel structure and a NW transfer fault. Geologically the area is underlain by biotite rich sediments which are often shallow dipping with numerous small stocks and bosses of granodiorite. The results identify seven regional anomalies with gold values above 20ppb. Multi-element data is pending and this will be integrated with the gold results to prioritise areas for follow-up geochemistry.


SENEGAL

The wet season review period in Senegal concentrated on the identification of new targets and phase 1 RAB drill programmes for commencement in Q4 to deliver non refractory ounces to the Massawa project. Priority has been given to targets along the Main Transcurrent Shear Zone (MTZ) (Samina, Kaya-Kaldou, Saraba, Kawsara South, Rheina, Nouma and Missira) where increased fluid flow, more intense alteration and higher gold gradesare observed.


COTE D’IVOIRE

The third quarter of 2011 saw progress made on the Diaouala and Nielle permits. Mapping and soil sampling has continued to increase our understanding of the regional prospectivity of the Diaouala permit with a number of gold in soil anomalies extending over several kilometres. These are coincident with major structures that also host mineralisation discovered by Gryphon Minerals on adjacent permits in Burkina Faso,including their recently identified Stinger deposit.

On Nielle, we have progressed the near-mine targets with RC drilling on Tongon West, Seydou, Jubula and Sekala which returned combined geological estimates of 460 000 ounces at 1.3g/t. We have also continued our greenfields programmes beyond the 15 kilometre radius, with soil and mapping programmes in the Nafoun-Koulivogo region in the south of the permit and trenching at Katosol in the north.

Phase 1 diamond drilling to test the potential below the southern zone pit has been completed but results limit the potential with the system dying out at depth. No further drilling is planned at this stage.


DEMOCRATIC REPUBLIC OF CONGO

Kibali

A strategic decision was made to restructure the exploration department to form dedicated brownfields and greenfields exploration teams to ensure that, as well as completing the feasibility work and testing extensions to known deposits, we are also testing the prospectivity of the greater permit area and evaluating targets at the base of the resource triangle, creating the opportunity for the discovery of new world class gold deposits in the region.

The establishment of the greenfields team has paid instant dividends with a major leap in our geological understanding of the region. The known deposits of the Kibali project are hosted along a reactivated thrust plane which creates plunging lodes of mineralisation as exemplified by the KCD deposit. The identification of a major NE trending sub-verticalshear zone, from the interpretation of geophysical data and supported by field mapping, has provided a new exploration opportunity. The structure locates in the western part of the Kibali permit and transgresses the area for more than 30 kilometres causing offsets to the main lithological units, as well as acting as a conduit for intrusives and gold bearing fluids due to the coincident gold in soil anomaly. Two prioritised targets, Zambula in the south and Kalimva in the north, have been the focus of work this quarter.

Zambula lies approximately 15 kilometres to the southwest of the KCD deposit, where soil results return one of the strongest geochemical anomalies on the target which is underlain by a package of volcanosediments and ironstones located along the western contact of the Watsa dome igneous complex. Along the strike of the anomaly a banded to massive chert unit outcrops and is characterised by alternating 1 to 5 centimetre bands of oxidised sulphide and silica-rich layers, locally interlayered with thin magnetite bands.

As well as field mapping, lithosampling along three kilometres of the 5.5 kilometre soil anomaly has returned values ranging from 0.5g/t to 4.98g/t associated with ironstone and chert and grab samples from old pits and trenches returninga highest value of 8.5g/t. Old auger drill data completed by Barrick also confirms a bedrock source to the anomaly with values above 1g/t.

Data integration and interpretation is being completed with the aim of completing phase 1 reconnaissance drilling in Q4.

Kalimva and Ikamva were old colonial open pits and Sokimo drill data returned narrow high grade intersections from the main zone: K300 - 3 metres at 22.0g/t from 38.63 metres, K301 - 4.39 metres at 12.5g/t from 45.99 metres, S12 - 1.5 metres at 8.6g/t and S15 - 15.0 metres at 3.40g/t. Soil sampling results at Kalimva highlight gold peaking up to 2562ppb. A plus 100ppb soil contour delineates a NNE trend with plus 2 kilometre cumulative strike length over 250 metres average width. Kalimva lithosamples returned assay results up to 13.6g/t and 39% of the 40 samples taken returned an average grade of 2.9g/t. Reconnaissance work at the old Okimo workings at Ikamva, one kilometreto the northwest of Kalimva, returned lithosamples of up to 1.31g/t.

Brownfields work continued with infrastructural drilling for mine development as well as phase 1 reconnaissance drilling to test the potential down plunge continuity of mineralisation at Pakaka, Agbarabo, Gorumbwa and Kombokolo. At Pakaka, the first drill hole PDD145, a step out of 450 metres from previous drilling, confirmed continuity of the mineralised system returning 29 metres at 3.19g/t from 394 metres. At Agbarabo, hole ADD010, a step out of 250 metres, returned 13 metres at 1.3g/t from 354 metres and 6 metres at 1.45g/t from 435 metres. At Gorumbwa and Kombokolo, while the geology was confirmed per the model,no mineralisation was intersected in the borehole due to the pinch and swell morphology of the mineralisation at the point of intersection.


Future work programmes

Our key strategic objectives for the next year are:

• Sabodala Belt Senegal: Decision on Massawa development with completion of feasibility study and the exploration of 
  satellite targets to deliver two million ounces of non-refractory ore.
  
• Senegal-Mali shear zone (SMS): Completion of Gounkoto underground prefeasibility study and the identification of
  additional satellite deposits around both Gounkoto and the Loulo plant.
  
• Northern Côte d’Ivoireand southwest Burkina Faso (Boundiali belt, Senoufo-Loumana belt): Exploration within the Nielle
  permit leading to the identification of satellite deposits and at least three advanced targets. Acquisition of a permit
  portfolio in southwest Burkina Faso.
  
• Kibali: Demonstrate the exploration potential at Kibali and identify the potential for one new world class, plus three
  million ounce deposit.
  
• Develop at least one new exploration opportunity within the African continent.