Results for the quarter ended 30 September 2002€¦ · Argonaut Project Presented at New Orleans Conference November 2002. 2 Disclaimer Certain forward looking statements are contained

Argonaut Project

Presented at New Orleans ConferenceNovember 2002

2

Disclaimer

Certain forward looking statements are contained in this

presentation which include, without limitation, expectations

regarding the gold price, production estimates, operating

expenditure, capital expenditure projections and the

financial position of the company.

Although DRD believes that the expectations reflected in such

statements are reasonable, no assurance can be given that

such expectations will prove to be accurate.

Accordingly, results could differ from those projected.

3

What is Argonaut?

Largest single untapped gold resource in the world

DRD’s Southern Down Dip Extension of the

Central Rand

Surface area = 270km2 (30km long x 10km wide)

Main Reef and Main Reef Leader

Depth: 3 000m - 5 000m below surface

Resource 111m oz = 3 500 tonnes

4

What is Argonaut?

Mining could continue for the next 100 years

DRD “Bluesky” potential for 3 new mines

Central, East and West Mine

12 000 jobs per mine

Mining to 5 000 m not an obstacle

5

History of Argonaut

1983 - 1986 First project team from Rand Mines

1983 - 1989 First 9 boreholes drilled

1989 - 1990 Further investigations by DRD

1993 Re-evaluation of geological

information by Reading and

Reynolds

R70 million spent on project to date

6

How does Argonaut rank internationally?

Operations Resources m oz %1. Harmony 12 295 19%2. Anglogold 20 282 18%3. Newmont 26 170 11%4. Gold Fields 8 151 9%5. Placer/Aurion 22 144 9%6. Barrick 18 129 8%7. Argonaut - 111 7%8. Western Areas - 109 7%9. Avgold - 80 5%10. Durban Deep 4 65 4%11. ARM Gold 3 23 1%

TOTAL 1 559 100%

7

Gold production

million oz per annum %1. Newmont 8.6 24%2. Barrick 5.6 16%3. Anglogold 5.5 15%4. Gold Fields 4.5 12%5. Placer/Aurion 3.8 11%6. Harmony 3.2 9%7. Argonaut 1.4 4%8. ARM Gold 1.1 3%9. Durban Deep 1.0 3%10. Western Areas 0.7 2%11. Avgold 0.5 1%

TOTAL 35.8 100%

8

Cash costs

$/oz1. Durban Deep 2472. Harmony 2043. Western Areas 1854. Newmont 1805. Gold Fields 1776. Placer/Aurion 1757. Barrick 1678. ARM Gold 1679. Anglogold 16010. Argonaut 16011. Avgold 130

9

Market cap per resource ounce

$/oz1. Barrick 602. Newmont 463. Gold Fields 354. Placer/Aurion 355. ARM Gold 296. Anglogold 207. Durban Deep 138. Harmony 99. Western Areas 710. Avgold 711. Argonaut 7

Argonaut Mine

Argonaut Mine

Ore resources and shaft plan

Main Reef Main Reef Leader

Shaft development

Proposed borehole 2km grid positions

15

Stratigraphy of the Main Conglomerateunit - Central Rand

BooysensShale

KimberlyConglomerate

KrugersdorpFormationBird Congl

LuipardsvleiQuartzite

Livingstone

RandfonteinQuartzite

Johnstone Con

LanglaagteQuartzite

Main Congl

MaraisburgQuartize

South Reef

Middle Reef

Main Reef LeaderBlack BarMain Reef

North Reef

Thickness range

30 - 50 metres

0 - 150 metres

150 - 200 metres

40 - 50 metres

200 - 275 metres

10 - 15 metres

80 - 100 metres

20 - 30 metres

90 - 100 metres

25 - 70 metres

75 - 100 metres

Dis

tanc

e 4m

16

Mineral resource

Tons Grade Gold Gold

million g/ton tonnes m oz

Central 261 7.36 1 917 62

West 150 6.67 997 32

East 77 6.89 532 17

Total 487 7.10 3 446 111

Mined 144 11.4 1 648 53

17

Comparisons with similar mines

The Argonaut Central Mine will produce 480 000tonnes/month of ore from 3 shaft systems

Shaft Ore milled Costs tonnes/month Rand/tonne

Kopanang (VAR no 9) 177 000 380 Tau Lekoa (VAR no 10) 160 000 303 Elandsrand 180 000 410 Harmony 166 000 321 Freegold 174 000 357 Average 171 000 356 Argonaut 160 000 385

18

Prospecting costs

Summary: Costs (Jun 2002 money)

Cost Drilling 35 holes Prospecting permit - Surface boreholes R226 m 3D Seismic Survey R188 m Bankable feasibility R 50 m TOTAL R505 m

19

Financial returns and sensitivity

ParametersBase case: Capex = R7 595 m

Gold price = R110 000/kg ($325/oz;R10.5/$) Cash costs = R385/ton ($160/oz) Grade = 7.5 g/t (conservative) NPV discount rate = 10%

Payback:min = 12 yearsmax = 14 years from June 2003

Life = min 20 years to 2034 with current information. Lifecould easily extend to 30 years once bankable feasibility iscompleted.

20

Returns and sensitivity

Gold price Costs NPV IRRGold price +/- 10%

Low case $295/oz R385/t R 514 m 11.10% paBase case $325/oz R385/t R1 220 m 12.46% paHigh case $358/oz R385/t R2 304 m 14.36% pa

Costs: Pier group low/high

Low case $325/oz R320/t R2 046 m 13.93% paBase case $325/oz R385/t R1 220 m 12.46% paHigh case $325/oz R410/t R 904 m 11.85% pa

21

Innovative mining concepts

Underground ore treatmentUnderground personnel accommodationNon-destructive blastingContinuous 24 hour/day operationsBackfilling of mined out areasHydroelectric electricity generationHydropower for drillingIce cooling for ventilationIssues for mining to 5 000m addressed inDeepmine research project

22

Deepmine research project

Research project 1998 - 2001Funded by DRD, Anglogold, Gold Fields, CSIR,Wits University145 Research projects200 ResearchersFocus on mining to 5 000mDeepmine conclusion:

No serious impediments to mining to 5 000 m

23

Conclusion

DRD is able to bring

a world class orebody

into full production by 2014