21
business communications and also allows our 
employees to communicate with their families 
from the accommodation village. 
Mine production for the year totalled 502,034 
tonnes of ore at a reconciled grade of 4.17 g/t 
for 67,307 ounces.  
The M2 shoot ore source supplied 44% of total 
ore production at an average grade of 3.7 g/t. 
The M1 supplied 14% at 3.93 g/t and Challenger 
West was 32% at 5.68 g/t. 
Developing the high grade Challenger West 
shoot has continued to be the primary focus for 
the past and future 12 months whilst finishing 
M1 / M2 lodes at the base of the mine on the 
155 and 135 levels.
The year to date adjusted cash operating costs 
were $1,107 per ounce of gold. Total site oper-
ating cash costs were $67.5 million. Total cash 
expenditure including operating, capital and 
exploration was $140 million.
Capitalised expenditure for the mine was $57.5 
million which included the main decline, level 
accesses, cross cuts, ventilation accesses, 
stockpile bays, and diamond drill drives along 
with electrical and dewatering stations.
A total of $6.3 million was spent on numerous 
sustaining capital projects including a communi-
cations upgrade, excavator, various mill upgrades, 
and airstrip and access road upgrades.
The mining contract with Leighton Contractors 
Pty Ltd ended in 2013. Following a tendering 
process, the new mining contract was awarded 
to Byrnecut Australia Pty Ltd, with the new 
mining contract commencing on 1 August 2013.
Operations Report
continued
Operations Report
Physicals 2012/13 2011/12 % Change 
Ore mined tonnes 502,288 606,659 -17%
Ore treated tonnes 556,631 644,629 -14%
Head grade (gold) Au g/t 3.91 4.6 -15%
Gold recovery % 94.5 92.4 2%
Gold poured ounces 66,216 87 ,388 -24%
Cost Category
2012/13
$US/oz Gold 
Produced
2011/12
$US/oz Gold 
Produced
Total cash cost 1,135  864 
By product credit*  (2)  (2)
Depreciation / amortisation – operating  695  535 
Total production cost  2,030  1,397 
* Net of silver royalties
Operational Performance
Significant geological milestones at Challenger 
for the year include the identification of the ‘215 
Shear’, confirmation of M2 lode mineralisation 
below the ‘215’ Shear, and continued develop-
ment on the high grade Challenger West lode. 
Development of the 215 level highlighted a 
moderate angle ductile brecciated zone dipping 
to the north west (termed the 215 Shear). This 
structure, rather than the ‘79’ Fault, has resulted 
in the offset in the lode system below the 215 
level and this has been confirmed in re-examina-
tion of the drill core. Mining on various levels 
above and below the structure revealed it 
bisected the 79 Fault in a very similar position to 
where the lodes were truncated on a number of 
levels, and hence its significance wasn’t recog-
nised for some time. Due to the orientation and 
moderate dip of the 215 Shear, the lodes were 
offset more than previously expected, and the 
immediate levels beneath, abutting the feature, 
had greatly reduced stope size.
Development to test Challenger West orebody 
has been highly successful on the 790 and 810 
levels, showing that the structure, while narrow 
and poddy, has good continuity along its strike 
length. Additional development on the 890, 870 
and 650 levels has highlighted the structural 
variability of the lode down plunge. Considerable 
drilling has been undertaken to better define the 
Challenger West shoot and add to the resource.