Gem Diamonds Limited (GEMD) 2008年年度報告「LSE」.pdf

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1、ANNUAL REPORT 2008Hi ghl i ghts1Board of Di rectors2Chai rmans Revi ew4Chi ef Executi ve Of f i cers Revi ew6Chi ef Fi nanci al Of f i cers Revi ew 12Annual Resource Statement18Sustai nabl e Devel opment Report30Di rectors Report37Remunerati on Report41Corporate Governance Report52Responsi bi l i ty

2、 Statementof the Di rectors60Annual Fi nanci al Statements61Advi sors and Contactsi bcThe Groups portfol i o compri ses produci ng ki mberl i te andl amproi te mi nes,devel opment proj ects and expl orati on assets,as wel l as di amond benef i ci ati on centres.Operati ons and proj ectsare si tuated

3、 i n Angol a,Austral i a,Botswana,the Central Af ri canRepubl i c,the Democrati c Republ i c of Congo,Dubai,Lesotho,Mauri ti us and Indonesi a.Wi th Letengs producti on of the worl ds most remarkabl e whi tedi amonds and El l endal es producti on of rare fancy yel l owdi amonds,Gem Di amonds i s foc

4、used towards hi gher val uedi amonds.Thi s segment of the market i s expected to del i verattracti ve l ong term returns.ContentsGem Diamonds is a global diamond companythat has been pursuing a long term growthstrategy through targeted acquisitions and thedevelopment of existing assets.Under current

5、market conditions,the Group is focused onthe development of its cash generative assetsand has curtailed all non-essential capital anddevelopment expenditure.Cover:Light of Leteng 478 cts,recovered at Leteng mine in September 2008.Annual Report 2008cRobust operati onal performance i n 2008cLeteng dou

6、bl i ng of producti oncEl l endal e producti on ramp upcRecovery and sal e of Li ght of Leteng for US$18.4 mi l l i on cStrong di amond pri ces for the first ei ght months,negated bysi gni ficant pri ce decl i ne i n l ast quartercRapi d response to economi c envi ronment through cost andoperati ng

7、expendi ture reducti on as wel l as capi tal preservati on cPl aci ng announced to rai se approxi matel y US$107 mi l l i on cGroup poi sed to emerge from downturn i n posi ti on of strengthHighlightsAnnual Report 20082Board of DirectorsNONEXECUTI VE DI RECTORSRoger spent ei ght years at Barcl ays,l

8、 atterl y as the CEO of the UK banki ngoperati on and as a member of the Boardof Barcl ays Pl c.Under hi s l eadershi p,the UK busi ness was si gni fi cantl yrestructured.Pri or to that he spent tenyears i n i nvestment banki ng i n Londonand vari ous posi ti ons i n Chi na and I ndi afor Fl emi ngs

9、 and BZW.Roger started hi s career wi th a 12-year servi ce i n theBri ti sh Army.He j oi ned Gem Di amondsi n February 2007.Mi ke i s a mi ni ng engi neer MBA wi th over30 years experi ence i n the mi ni ng sector.He was a foundi ng di rector of Bi l l i ton andwas i nstrumental i n Bi l l i ton s

10、I PO on theLondon Stock Exchange i n 1997 andsubsequent merger wi th BHP i n 2001.Mi ke reti red from hi s posi ti on of Executi veDi rector at BHP Bi l l i ton i n 2006 and i s nowthe Chai rman of New Worl d Resources,a non-Executi ve Di rector of Central RandGol d,Ferrexpo pl c and Co-presi dent o

11、fpri vate equi ty fund AMCI Capi tal.Mi kej oi ned Gem Di amonds i n February 2008.Gavi n was the Di rector of Operati ons at De Beers from Apri l 2000 unti l hi sreti rement i n 2004.He j oi ned De Beers i n 1979 i n Botswana for 11 years.Thereafter,he was appoi nted Assi stantGeneral Manager at De

12、 Beers Mari ne i nCape Town unti l 1994,whereafter hereturned to Botswana as General Managerat Orapa and Letl hakane Mi nes.FromJanuary 1996 to March 2000,Gavi n hel dthe posi ti on of Deputy Managi ng Di rectorof Debswana Di amond Company.Gavi nj oi ned Gem Di amonds i n February 2007.Roger Davis(5

13、2)non-Executive Chairman Mike Salamon(54)Senior Independent Director Gavin Beevers(59)non-Executive Director Dave has over 15 years worki ngexperi ence i n i nternati onal i nvestmentbanki ng.Between 1994 and 2000,Dave served as a seni or executi ve andsubsequentl y Managi ng Di rector of theBeny St

14、ei nmetz Group.Dave i s currentl ythe Seni or Partner and CEO of the GenevaManagement Group,an i nternati onalweal th management and fi nanci alservi ces company.Dave j oi ned GemDi amonds i n October 2005.Lord Renwi ck spent the maj ori ty of hi scareer representi ng Bri tai n i n theambassadori al

15、 servi ce.He served i n theUni ted States from 1991 to 1995 and i nSouth Afri ca from 1987 to 1991.He i s Vi ce-Chai rman of J.P.Morgan Cazenove andVi ce-Chai rman,I nvestment Banki ng,of J.P.Morgan Europe,Chai rman of Fl uor Ltd anda non-executi ve Di rector of Compagni eFi nanci ere Ri chemont and

16、 Kazakhmys pl c,havi ng previ ousl y served on the Boards ofBHP Bi l l i ton,Bri ti sh Ai rways and SABMi l l er.Lord Renwi ck j oi ned Gem Di amonds i nSeptember 2007.Ri chard spent 20 years i n the Bri ti sh Army,l atterl y as the Commandi ng Offi cer of 22SAS Regi ment,duri ng whi ch ti me he saw

17、servi ce across the Mi ddl e East,Lati nAmeri ca and Afri ca.Ri chard has an MBAfrom Cranfi el d Uni versi ty and a Masters i nI nternati onal Secu ri ty Studi es from Ki ngsCol l ege,London.Ri chard i s the CEO ofChakata Ltd,an i nvestment managementcompany focused on defence and securi tytechnol o

18、gi es.Ri chard j oi ned GemDi amonds i n February 2008.Dave Elzas(42)non-Executive Director Lord Robin Renwick(71)non-Executive Director Richard Williams MBE MC(42)non-Executive Director Annual Report 20083EXECUTI VE DI RECTORSCl i fford j oi ned Angl o Ameri canCorporati on i n 1986 and was seconde

19、dto E Oppenhei mer and Son as HarryOppenhei mer s personal assi stant i n1988.I n 1990,he was appoi ntedmanagi ng di rector of E Oppenhei merand Son,a posi ti on he hel d unti l l eavi ngi n December 2004.Duri ng that ti me,Cl i fford was al so a di rector of CentralHol di ngs,Angl o Ameri can and D

20、BI nvestments.Fol l owi ng the buy-out of De Beers i n 2000,Cl i fford served on theDe Beers Executi ve Commi ttee.Cl i ffordformed Gem Di amonds i n Jul y 2005.Al an hol ds a BSc i n Mi ni ng Engi neeri ngand has 32 years experi ence i n the mi ni ngi ndustry.Duri ng hi s career he has workedi n va

21、ri ous countri es,i ncl udi ng South Afri ca,Nami bi a,Botswana,Gui nea,Ghana andRussi a.He spent 28 years wi thi n the De Beers group,i ncl udi ng four years as theGeneral Manager of the Namdeb Di amondCorporati on and four years as the GroupManager,Operati ons and Head ofOperati ons for DBCM.From

22、March 2006unti l August 2007,he was the Managi ngDi rector of Gol d Fi el ds Ghana operati ons i n West Afri ca.Al an j oi ned Gem Di amondsi n November 2007 and was appoi nted to the Board i n Apri l 2008.Clifford Elphick(48)Chief Executive Officer Alan Ashworth(54)Chief Operating Officer Kevi n ha

23、s over 20 years experi ence i n the mi ni ng i ndustry havi ng worked for De Beers and Angl o Ameri can between1985 and 2005,and Xstrata i n 2005.Kevi n has hel d vari ous strategi c l eadershi pposi ti ons coveri ng fi nance,suppl y chai n,I T,ri sk management,i nternal audi t andbusi ness strategy

24、.Kevi n compl eted hi sarti cl es wi th Coopers and Lybrand i n 1984 and i s a regi stered CharteredAccountant.Kevi n j oi ned Gem Di amondsi n January 2006.Kevin Burford(50)Chief Financial Officer Gl enn was cal l ed to the Johannesburg Bar i n 1987 where he spent 14 yearspracti si ng as an advocat

25、e speci al i si ng i n general com merci al and competi ti onl aw,and took si l k i n 2002.Gl enn wasappoi nted De Beers fi rst General Counseli n 2002 and was al so a member of thei r Executi ve Commi ttee.Gl enn wasresponsi bl e for a number of key i ni ti ati vesduri ng thi s tenure,i ncl udi ng

26、overseei ngthei r re-entry i nto the USA.Gl enn j oi nedGem Di amonds i n May 2006 and wasappoi nted to the Board i n Apri l 2008.Graham spent 23 years at Angl o Ameri canand De Beers,worki ng on gol d,di amondsand heavy mi neral sands proj ects.Heserved as Mi neral Resources Manager atNamdeb and Na

27、maqual and di amondmi nes and i n al l uvi al expl orati on proj ectsacross the gl obe.Graham l ed the DeBeers Gl obal Expl orati on Targeti ng Teamfor both ki mberl i tes and al l uvi al s from2004 to 2005.Graham j oi ned GemDi amonds i n August 2005 and wassubsequentl y appoi nted to the Board.Gra

28、ham resi gned from the Board i n Apri l 2008 but remai ns a member of the Gem Di amonds management team.Glenn Turner(49)Chief Legal and Commercial Officer Graham Wheelock(51)Chief Mineral Resources ManagerChairmans ReviewAnnual Report 20084these acti ons and i n accordance wi th the Group s accounti

29、 ngpol i ci es,assets were regretful l y i mpai red at the year end.The Leteng mi ne i n Lesotho remai ns a Best i n Cl ass asset i nthe di amond i ndustry.Commi ssi oni ng of i ts second pl antcommenced i n March 2008 and producti on reached namepl ate capaci ty i n Jul y 2008.The Leteng mi ne cont

30、i nues toproduce di amonds of the hi ghest qual i ty,strong operati onaland fi nanci al resul ts and remai ns the core asset i n the Group.The Leteng mi ne has now produced four of the twentyl argest di amonds ever di scovered three wi thi n the l astthree years.At the El l endal e mi ne i n Austral

31、 i a,the worl d s l argest producerof fancy yel l ow di amonds,management achi eved the targetsof hi gher tonnage throughput and reduced cash costs.I nAugust,the El l endal e mi ne entered i nto a sal es agreementwi th a hi gh end US j ewel l ery manufacturer and retai l er fori ts enti re fancy yel

32、 l ow producti on and a smal l quanti ty ofi ts better qual i ty whi te di amonds.Si nce January 2009,nego ti ati ons have been ongoi ng to turn thi s i nto a l ong termagreement for the fancy yel l ow producti on from the El l endal e9 pi pe and non-bi ndi ng agreement has been reached.Operati onal

33、 l y,the expansi on at Leteng and the turnaroundat El l endal e proceeded i n l i ne wi th the Group s busi nesspl an.The reducti on i n costs at El l endal e was sl ower thanenvi si oned i n the fi rst hal f of the year pri mari l y due to themuch stronger than anti ci pated Austral i an dol l ar:U

34、S dol l arexchange rate and record gl obal oi l pri ces.Mi ni ng at Cempakawas suspended from Apri l to earl y September 2008 as aresul t of al l eged envi ronmental probl ems,duri ng whi chperi od si gni fi cant costs were i ncurred but wi th no revenueto offset these agai nst.Gem Di amonds i s neg

35、oti ati ng wi th the Government ofBotswana for the award of a mi ni ng l i cence at Gope i nBotswana whi ch remai ns a proj ect wi th strong l ong termpotenti al.Botswana i s a pol i ti cal l y stabl e country wi th a l onghi story of di amond mi ni ng.Duri ng 2008 Gem Di amonds conti nued to i nves

36、t i n i tsbenefi ci ati on acti vi ti es wi th the purchase of Cal i bratedDi amonds,wi th i ts state of the art di amond processi ng andcutti ng technol ogy and the securi ng of the servi ces of keyEstabl i shed i n 2005,Gem Di amonds was l i sted on the LSE i nFebruary 2007 rai si ng US$635 mi l l

37、 i on and had at that ti meone produci ng asset,the Leteng mi ne i n Lesotho.Gem Di amonds started 2008 i n pursui t of rapi d growth wi tha portfol i o of produci ng mi nes,devel opment proj ects andexpl orati on assets.The fi rst ei ght months of 2008 saw astrong ri se i n rough di amond pri ces,e

38、speci al l y for l argehi gh qual i ty di amonds,fuel l ed by conti nued economi cgrowth and ri si ng gl obal j ewel l ery consumpti on.I n the l ast four months of 2008,rough di amond pri ces fel lsuddenl y and si gni fi cantl y as the gl obal banki ng cri si s severel ycurtai l ed fi nanci al l i

39、qui di ty i n the di amond manu facturi ngpi pel i ne,most notabl y i n the al ready hi ghl y i ndebted tradi ngand manufacturi ng busi nesses.The di amond l endi ng banksreduced thei r credi t l i nes whi ch has exacer bated the probl emsfor di amantai res and reduced demand for rough di amondssti

40、l l further.Furthermore,the anti ci pated reducti on i n con sumerdemand created concerns i n the cutti ng and pol i shi ng centres that l arge amounts of di amond j ewel l ery i nventory i nretai l stores on consi gnment,woul d be returned to tradi ng and manufacturi ng busi nesses after the Thanks

41、 gi vi ng andChri stmasperi od i n the Uni ted States.I n l i ght of the extent of thi s negati ve turn i n the macroenvi ronment i t became cl ear to Gem Di amonds Board thatmuch of the growth portfol i o acqui red si nce the I PO coul dwel l be compromi sed i n these ci rcumstances.Thus the Di rec

42、tors of Gem Di amonds carri ed out a revi ewof al l proj ects wi thi n the Group to re-eval uate and agreeshort and medi um term obj ecti ves i n l i ght of the verydi ffi cul t cl i mate i n whi ch the i ndustry found i tsel f duri ng thel ast quarter of 2008.The deci si ons resul ti ng from thi s

43、revi ewwere ai med at opti mi si ng returns from produci ng assetsand mi ni mi si ng al l non-essenti al capi tal expendi ture anddevel op ment.Gem Di amonds i s now pri mari l y focused on i tstwo strongest produci ng assets,the Leteng mi ne and themi ni ng operati ons at the El l endal e 9 pi pe a

44、t the El l endal emi ne.Mi ni ng operati ons were ceased at the El l endal e 4 pi pe,and pl aced on care and mai ntenance.The Cempaka mi ne i nI ndonesi a and al l al l uvi al mi ni ng operati ons i n the DRC andCAR were al so pl aced on care and mai ntenance.As a resul t ofAnnual Report 20085person

45、nel from Matri x Di amond Technol ogy wi th thei r uni quedi amond mappi ng and anal ysi s technol ogy.Gem Di amonds i s now focussed on generati ng and protecti ngcash and l oweri ng cash outfl ows.Si gni fi cant steps have beentaken to l ower overheads and operati ng costs.At the end of 2008 Gem D

46、i amonds had US$61.4 mi l l i on of cash on i tsbal ance sheet and net cash of ci rca US$19.9 mi l l i on.Tradi ng condi ti ons weakened duri ng January 2009 thoughthe Leteng February tender achi eved a pri ce that was 9.7%up on January.The Board bel i eves that i t i s i mportant toprovi de the Com

47、pany wi th the abi l i ty to survi ve any l i kel ydi amond pri ce scenari os,i ncl udi ng further reducti on i nsal es pri ces.I n l i ne wi th the acti ons al ready taken by management and the conti nued weakness i n rough di amond pri ces the Company has announced a share pl aci ng to rai seUS$10

48、7 mi l l i on.The net proceeds of the capi tal rai si ng wi l lenabl e Gem Di amonds to repay exi sti ng debt and fundworki ng capi tal.As a resul t,net debt i s expected to reduceto zero fol l owi ng compl eti on of the proposed pl aci ng.Wi th the appoi ntment as non-Executi ve Di rectors i nFebru

49、ary 2008 of Mi ke Sal amon and Ri chard Wi l l i ams MBE MC,the Board of Gem Di amonds has been furtherstrengthened.Subsequent to thi s,at the Board meeti ng i n Apri l 2008,Gl enn Turner(Chi ef Legal and Commerci alOffi cer)and Al an Ashworth(Chi ef Operati ng Offi cer)were appoi nted to the Board

50、of Di rectors.I n l i ne wi th hi sappoi ntment to the Board,Gl enn Turner was requested torel ocate to the Company s head offi ce i n London.At thesame board meeti ng Graham Wheel ock resi gned from theBoard.The Board woul d l i ke to express i ts thanks to GrahamWheel ock for hi s commi t ment and

51、 contri buti on duri ng thi s tenure as a Di rector.The Board remai ns commi tted tomai ntai ni ng the hi ghest standards of corporate governanceand currentl y compl i es wi th the best practi se governanceprovi si ons of the Combi ned Code.Pri ori ti si ng the heal th and safety of al l empl oyees

52、remai ns asoci al and fi nanci al i mperati ve for the Group.I n 2008,theGroup s operati ons were chal l enged to meet a LTI FR of 1.0.Through the concerted efforts of management and theheal th and safety offi cers,a LTI FR of 0.48 was achi eved i n2008 over 8 267 700 man-hours worked,exceedi ng the

53、targets for the year.2008 i s the second consecuti ve year thatthe Group has outperformed i ts LTI FR targets.Gem Di amonds remai ns determi ned to operate to the hi ghestenvi ronmental and ethi cal standards.Every operati on i s requi red to mai ntai n an appropri ate envi ronmentalmanagement syste

54、m,i n compl i ance wi th the Group HSSEpol i cy.More i nformati on on the Group s Sustai nabi l i tyReport can be found on pages 30 through to 36.I t has been more than ei ght years si nce the Ki mberl ey Processwas i ntroduced to the di amond i ndustry.The scheme hasgrown i n reputati on and has co

55、ntri buted to the markedreducti on i n the trade i n confl i ct di amonds.Gem Di amondsi s commi tted to the pri nci pl es i nherent to thi s scheme and can confi rm that al l di amonds sol d by the Group areKi mberl ey Process certi fi ed.Gem Di amonds entered 2008 wi th a broad portfol i o of asse

56、tsposi ti oned for growth.The Company reacted qui ckl y to thegl obal downturn and the consequenti al fal l i n rough di amondpri ces.The Board and I bel i eve that the manage ment of GemDi amonds i s ensuri ng that i t enters the very di fferent worl d of2009 i n the best posi ti on to emerge from

57、thi s peri od i n aposi ti on of strength.The l ong term outl ook for di amond pri ces i s underpi nnedby what al l the mai n producers and market commentatorsrecogni se as a si gni fi cant l ong term suppl y/demandi mbal ance and we expect hi gh qual i ty di amond pri ces torecover strongl y i n th

58、e medi um term.Roger Davisnon-Executive Chairman1 Apri l 2009Chief Executive Officers ReviewAnnual Report 200862008 saw Gem Di amonds second year as an LSE l i stedcompany.I n 2008 Gem Di amonds executi ves begani mpl e men ti ng a three year growth pl an.The overal l obj ecti veconti nued to be tha

59、t Gem Di amonds was to grow i tsproducti on and generate appropri ate returns.To achi eve thi s,the Group focussed on compl eti ng the second pl antexpansi on at the Leteng mi ne,i ntegrati ng operati ons atKi mberl ey and BDI Mi ni ng i nto the Group and the furtherdevel op ment of proj ects i n Bo

60、tswana,DRC,Angol a and CAR.Thi s growth strategy was acti vel y pursued and i mpl e mentedunti l October 2008.At whi ch poi nt the start of the gl obaleconomi c cri si s,wi th i ts knock-on effect on the di amondi ndustry,parti cul arl y wi th regard to pri ces for rough di amonds,meant that a revi

61、ew and i mpl ementati on of an enti rel ydi fferent strategy became necessary.Gem Di amonds management responded i mmedi atel y tothe chal l engi ng envi ronment and as part of an ongoi ngbusi ness revi ew i mpl emented a seri es of measures ai medat protecti ng Gem Di amonds operati ng and fi nanci

62、 alposi ti ons.The Group shi fted i ts focus to opti mi si ng themanagement of i ts strongest produci ng assets(the Letengmi ne and the El l endal e 9 pi pe at the El l endal e mi ne)i n orderto generate maxi mum cash fl ow.Al l non-cash generati ngoperati ons and proj ects were pl aced on care and

63、mai ntenanceor sl owtracked where appropri ate.The Group conti nues toseek reducti ons i n operati ng costs through restructuri ngsand a focus on cash management.There has al so beena si gni fi cant reducti on i n central costs attri butabl e to theCompanythrough sal ary reducti ons,cancel l ati on

64、of bonusesand a freeze on recrui tment.I n addi ti on there has al so been a substanti al reducti on i n di screti onary,sustai ni ng andexpansi onary capi tal expendi ture at the operati ng mi nes.LESOTHOGem Di amonds owns 70%of Leteng Di amonds i n partner-shi p wi th the Government of the Ki ngdo

65、m of Lesotho whi ch owns the remai ni ng 30%.Acqui red i n mi d 2006 forUS$118.5 mi l l i on,Leteng has to date del i vered excepti onalreturns for i ts sharehol ders.Si nce Gem Di amonds took control,Leteng s annual producti on has al most doubl ed,i ncreasi ngfrom 55 000 carats i n 2006 to 101 125

66、 carats i n 2008.I n 2008,Leteng conti nued to produce some of the worl d smost remarkabl e di amonds,i ncl udi ng the magni fi cent478 carat D col our whi te,Li ght of Leteng,the most val uabl estone recovered from Leteng to date,whi ch sol d i n thedi ffi cul t market condi ti ons prevai l i ng at

67、 the end of November2008,for a record US$18.4 mi l l i on.Di amond pri ces achi eved i ncreased rapi dl y over the fi rstni ne months of 2008 before fal l i ng back dramati cal l y i n thel ast quarter of 2008.A mi x of 63%Mai n pi pe and 37%Satel l i tepi pe ores was treated by al l three pl ants a

68、nd recovered a producti on mi x that achi eved an average revenue ofUS$2 123/ct,compared to US$1 976/ct i n 2007.I n the fi rst quarter of 2009 Leteng s di amonds sol d for anaverage of US$1 017/ct.Leteng has previ ousl y experi enced schedul ed power outagesas a resul t of l oad sheddi ng by South

69、Afri can el ectri ci typarastatal ESKOM that suppl i es the bul k of Leteng s el ectri ci ty.Standby el ectri ci ty generati ng capaci ty suffi ci ent to operateone of the two processi ng pl ants and the mi ni ng contractor spl ant i s bei ng i nstal l ed on si te.Thi s power source,combi ned wi th

70、the power that LesothoEl ectri ci ty Corporati on has undertaken to suppl y to Leteng i n the event of an ESKOM power outage wi l l enabl e ful lproducti on to be mai ntai ned.At the end of 2008 i ndi cated and i nferred resourcesamounted to 239 mt contai ni ng an esti mated 4.17 mi l l i oncarats w

71、i th an assumed i n-si tu val ue of US$6.5 bi l l i on.Thi sresource i s suffi ci ent to sustai n an open pi t l i fe of mi ne of33 years at current mi ni ng rates.LETENG MI NE PRODUCTI ON STATI STI CSFY08FY07Ore mi ned(mt)7.03.9Ore processed(mt)6.64.0Carats produced101 12573 916Grade(cpht)1.531.85C

72、arats sol d84 89176 873Pri ce(US$/ct)2 1231 976Annual Report 20087AUSTRALI AI n December 2007 Gem Di amonds acqui red Ki mberl eyDi amond Company.Ki mberl ey Di amonds owns 100%of theEl l endal e mi ne.The El l endal e mi ne i s the worl d s l eadi ngproducer of fancy and vi vi d yel l ow di amonds.

73、Ki mberl eyDi amonds al so hol ds a 39%i nterest i n Bl i na Di amonds,al i sted al l uvi al di amond mi ni ng and di amond expl orati oncompany adj acent to the El l endal e mi ne.I n earl y 2008,Ki mberl ey Di amonds was recapi tal i sed,modi fi cati ons were made to the processi ng pl ants and th

74、esal es methods were i mproved.The obj ecti ve was to turn a a l oss maki ng busi ness i nto a l ow margi n hi gh vol umeprofi tabl e operati on.Two chal l enges that Ki mberl ey Di amondsfaced i n thi s peri od were the strength of the Austral i an dol l arrel ati ve to the US dol l ar and the hi g

75、h pri ce of fuel,both of whi ch si gni fi cantl y i mpacted costs.These cost factorswere reduced i n the second hal f of 2008 but,from October2008 di amond pri ces suffered a dramati c sl i de.I n operati onal terms the mi ne del i vered a sati sfactoryperformance for the year.After a comprehensi ve

76、 revi ewof the mi ni ng operati on,capi tal was i nvested i n pl antmodi fi cati ons and waste stri ppi ng.A total of 14.8 mt ofwaste was removed from the El l endal e 4 and El l endal e 9 pi tsi n conj uncti on wi th 9.4 mt of ore mi ned.Thi s representeda si gni fi cant i mprovement i n mi ni ng p

77、erformance.Producti onreached 589 000 carats and 8.3 mt of ore was treated wi th anumber of producti on records bei ng achi eved at the mi nei n the second hal f of the year.The sal es and marketi ngstrategy for El l endal e s di amonds showed good resul ts i nthe fi rst hal f of the year wi th aver

78、age pri ces of US$207/ctachi eved.I n the second hal f of 2008 Ki mberl ey Di amondsentered i nto a si x month sal es agreement wi th a hi gh endj ewel l ery manufacturer for the suppl y of i ts renowned fancyyel l ow producti on.Di scussi ons are ongoi ng to extend theterm of thi s agreement and no

79、n-bi ndi ng agreement has been reached.Despi te the i mpact of the economi c downturn,El l endal e sti l l managed to achi eve an average US$185/ctfor the ful l year versus US$137/ct i n 2007.Pri ces of US$103/ctachi eved i n the fi rst quarter of 2009 are refl ecti ve of bothproducti on mi x as wel

80、 l as the conti nued weak demand seeni n January and February 2009.I n November 2008,i t was deci ded that producti on from thel ower val ue El l endal e 4 pi t woul d be curtai l ed and l i mi ted totreati ng ore that was currentl y on stockpi l e and presentl yaccessi bl e for mi ni ng wi thi n th

81、e confi nes of the exi sti ng pi tshel l.Thi s ul ti matel y l ead to the Company ceasi ng i ts mi ni ngoperati ons at the El l endal e 4 pi pe i n February 2009 and i thas si nce been pl aced on care and mai ntenance.Mi ni ng atthe El l endal e 9 pi pe conti nues.ELLENDALE MI NE PRODUCTI ON STATI S

82、TI CSFY08FY07Ore mi ned(mt)9.46.1Ore processed(mt)8.36.3Carats produced588 645475 306Grade(cpht)7.087.51Carats sol d537 082462 016Pri ce(US$/ct)185137I NDONESI ABDI Mi ni ng was acqui red by Gem Di amonds i n May 2007.I towns 80%of the Cempaka al l uvi al di amond mi ne i n southKal i mantan,I ndone

83、si a i n partnershi p wi th the Governmentof I ndonesi a whi ch owns the remai ni ng 20%.BDI Mi ni ngal so owned the Woodl ark Gol d Proj ect whi ch was sub-sequentl y sol d for US$27 mi l l i on.The al l uvi al deposi ts at the Cempaka mi ne consi st of theDanau Seran and Cempaka pal eo-channel s.T

84、he former,whi ch i s si gni fi cantl y smal l er but was of a hi gher grade,was mi ned si nce the commencement of the operati ons i n2004,and i s now depl eted.Mi ni ng started i n the Cempakachannel i n the second hal f of 2007.Duri ng 2008,mi ni ng was focused on depl eti ng the l ast bl ocksof hi

85、 gher grade Danau Seran channel.Thi s progressed wel l duri ng the fi rst two months of 2008 wi th throughputbudgeted tonnes bei ng achi eved i n February.I n March,thearea experi enced extreme rai n condi ti ons whi ch resul ted i nfl oodi ng of the Danau Seran channel mi ni ng area.Mi ni ng wasChi

86、ef Executive Officers Review continuedAnnual Report 200881Mai ntai n appropri ate heal th and safety standards and manage envi ronmental obl i gati ons.2I denti fy and concl ude acqui si ti ons that are l i kel y to have a posi ti ve i nfl uence on earni ngs and share pri ce and i ncrease the cri ti

87、 cal mass of producti on.3Successful l y i mpl ement the downstream process.4Successful l y concl ude the pre-feasi bi l i ty study on the Chi ri deposi t and potenti al acqui si ti on of an equi ty stake i n the Chi ri proj ect.5Successful l y concl ude the mi ni ng l i cence appl i cati on for Gop

88、e,secure fundi ng and commence the proj ect.6Successful l y i ntegrate the Ki mberl ey Di amond acqui si ti on.7Maxi mi se mi ne-gate revenue through opti mi sed sal es processes.8I ncrease the confi dence i n the di amond resource base.9Commi ssi on the second pl ant at Leteng wi thi n budget and a

89、chi eve rapi d producti on bui l d-up.10Achi eve pl anned throughput of tonnes treated at al l mi ni ng operati ons.11Achi eve budgeted recovery of carats at al l mi ni ng operati ons.12Achi eve budgeted earni ngs before i nterest,tax,depreci ati on and amorti sati ons(EBI TDA).KEY STRATEGI C OBJECT

90、I VES 2008 2010then moved to the Cempaka channel whi l e the pi t was bei ngdewatered.I n Apri l 2008,the mi ne was temporari l y suspendeddue to an envi ronmental concern.Thi s suspensi on was l i ftedi n September 2008.Once mi ni ng recommenced,tonnagethroughput was ramped up.I n November 2008 i t

91、 becamecl ear that the Cempaka mi ne was not economi c and i t i s con si dered unl i kel y that di amond pri ces wi l l recover suffi ci entl yi n the short term such that Cempaka coul d profi tabl y returnto operati on.I t was deci ded to pl ace the mi ne on care andmai ntenance as from January 20

92、09.A total of 32 748 carats were sol d duri ng 2008,wi th the fi rstparcel 15 040 carats achi evi ng US$331/ct and the l ast parcel,i n November,onl y achi evi ng US$89/ct.The average pri cefor 2008 was accordi ngl y US$233/ct.BOTSWANAGem Di amonds acqui red Gope Expl orati on Company fromDe Beers a

93、nd Xstrata i n May 2007 for US$34.1 mi l l i on.GopeExpl orati on i s the hol der of a retenti on l i cence coveri ng theGope 25 ki mberl i te deposi t i n the Central Kal ahari GameReserve(CKGR).A Mi ni ng Li cence Appl i cati on was submi ttedi n Jul y 2007 and negoti ati ons wi th the Government

94、ofBotswana regardi ng the terms of the mi ni ng l i cence arei n progress.Shoul d a mi ni ng l i cence be granted on acceptabl e terms,gi ven the current state of the fi nanci al markets,Gem Di amondsi ntends to devel op Gope at an appropri ate ti me i n the future.The pl an envi sages starti ng to

95、mi ne at a rate of 5 mpta,For the period 2008 2010 Gem Diamonds executives were charged with achieving the following:Annual Report 20089i n creasi ng to 8 mtpa,to produce over a mi l l i on carats perannum.The capi tal esti mate remai ns approxi matel y US$500mi l l i on.The rai si ng of debt fi nan

96、ci ng for thi s proj ect wassuspended due to the current l ack of debt capi tal.The Envi ronmental I mpact Assessment(EI A),based on the2005 EI A Act was compl eted and approved duri ng 2008.Thi si ncl uded a Soci al and Envi ronmental I mpact Assessment(SEI A)as part of the EI A.Publ i c Parti ci p

97、ati on meeti ngs,whi chform an i ntegral part of the SEI A,were hel d wi th al l i nterestedand affected parti es,i ncl udi ng communi ti es i nsi de and aroundthe CKGR.A record of deci si on was i ssued i n October 2008,approvi ng the SEI A for Gope.Marsh Envi ronmental Servi ces,an i ndependent co

98、nsul tantgroup,was engaged to conduct the EI A.A number ofi mpacts were i denti fi ed i n the SEI A,al l of whi ch can besati sfactory mi ti gated.DRCGem Di amonds operati ons i n the DRC compri se a numberof al l uvi al di amond proj ects and a ki mberl i te expl orati onprogramme across three broa

99、d areas,namel y Mbel enge,Lubembe and Longatshi mo.These i nterests are hel d vi aa number of compani es i n whi ch Gem Di amonds hol dsbetween an 80%and 100%sharehol di ng.The grades real i sed i n the terraces of the Kasa Ri ver to thenorth and south of Mbel enge were l ower than expectedand work

100、there was termi nated i n February 2008.Bettergrades were recorded from the bul k sampl i ng of the ri verfl ats adj acent to the Kasa Ri ver further upstream.A parti alri ver di versi on was constructed that al l owed dredgi ng to beundertaken i n an otherwi se i naccessi bl e part of the KasaRi ve

101、r where i mproved grades were achi eved.However,thedecl i ne i n the sal es pri ce for these types of di amonds madethe proj ect uneconomi c and i n November,operati ons atMbel enge were suspended.The dredgi ng operati ons i n the Lubembe Ri ver near theNsumbul a camp yi el ded areas of very hi gh g

102、rades.However,the di stri buti on of these hi gh grade pockets i s hi ghl y sporadi c and unti l a geophysi cal system can be devel oped to l ocate them and a mass mi ni ng techni que can bedevel oped to expl oi t them,the operati on has beensuspended.Under current market condi ti ons these deposi t

103、sremai n sub-eco nomi c for Gem Di amonds.The resource defi ni ti on of ri ver terraces and fl oodpl ai nsthat was taki ng pl ace i n the Longatshi mo area throughsystemati c fi el d mappi ng and l i mi ted sampl i ng had reacheda natural poi nt of suspensi on pendi ng the resul ts of theproposed bu

104、l k eval uati on programme.Subsequentl y,thi seval uati on programme was al so suspended i n response tothe fal l i n the sal e pri ce for these di amonds.No furtherterrestri al al l uvi al work i s envi saged i n the near future.The gravel sampl i ng i n the Longatshi mo Ri ver progressedwel l and

105、good average grades were recorded.I n responseto the decl i ne i n the sal e pri ce for these di amonds,adeci si on was taken to suspend al l dredgi ng operati ons.Pri or to the termi nati on,the operati on had produced2 136 cts.The current val uati on of thi s parcel i s ci rca 25%of the pri ce use

106、d for resource devel opment model l i ng.I n the l i ght of the downturn i n the markets,Gem Di amondsdeci ded to proceed onl y wi th a l i mi ted ki mberl i te expl orati onpro gramme i n the DRC,whi ch has now been pl aced on careand mai ntenance.CARGem Di amonds hol ds a 75%i nterest i n Gem Di a

107、mondsCentrafri que SA,i n partnershi p wi th the Government of the CAR whi ch hol ds the remai ni ng 25%.Gem Di amondsCentrafri que hol ds excl usi ve expl orati on and mi ni ng ri ghtsto the 800km2Mambr Concessi on.I n the target area on the Mambr Ri ver known l ocal l y as l eBuckl e,a sampl i ng

108、campai gn was carri ed out across theal l uvi al terrace and modern ri ver gravel s i n 2007.At 1.19 cphtthe di amond grades from the terraces were determi ned sub-economi c at the current cost base.Sampl i ng moveddownstream of l e Buckl e i n earl y 2008,i nto gnei ss basementtrap si tes wi thi n

109、the modern ri ver.To date the pri mary targets have been the Danki I sl and compl ex wi th threemaj or di versi ons compl eted duri ng 2008.Chief Executive Officers Review continuedAnnual Report 200810Esti mates of the di amond val ue vari ed between US$140/ctand US$175/ct duri ng 2008.As no stones

110、have yet beensol d,a fi rm val ue has not been obtai ned.The currentsampl i ng parcel of approxi matel y 4 000 carats wi l l be val uedand sol d i n earl y 2009.Due to current market condi ti ons,conti nued expl orati onand sampl i ng acti vi ti es were suspended i n November 2008.The mi ni ng si te

111、 has been pl aced on care and mai ntenancewi th adequate securi ty to ensure the protecti on of assets,whi l st a much reduced offi ce remai ns i n Bangui to mai ntai nstate rel ati ons,l egal and fi scal compl i ance.ANGOLAThe Cooperati on Agreement was si gned i n January 2007between Gem Di amonds

112、 and Avanti s Angol a wi th respectto a prel i mi nary feasi bi l i ty report to be produced on theChi ri ki mberl i te deposi t i n the Lunda Sul Provi nce of Angol a.An Opti on Agreement whereby Gem Di amonds can acqui rean effecti ve 11.25%i nterest i n Chi ri from Avanti s Angol a was si gned at

113、 the same ti me.A further opti on to i ncreaseGem Di amonds i nterest to 20%was al so agreed.A prel i mi nary feasi bi l i ty exerci se compri si ng geophysi cs,di amond dri l l i ng,l arge di ameter dri l l i ng and bul k sampl i ngwas i ni ti ated i n January 2008 and was compl eted i n March2009.

114、Thi s has shown a l arge ki mberl i te wi th an area ofapproxi matel y 60 hectares.I nteresti ng grades have beenreturned i n the north west,south west and south east margi nsof the pi pe.Sub economi c fi ne grai ned ki mberl i te occupi es asi gni fi cant posi ti on of the pi pe to depths exceedi n

115、g 200 m.The Chi ri techni cal commi ttee i s expected to meet i n Apri l2009 i n order to consi der the prel i mi nary feasi bi l i ty report.BENEFI CI ATI ONThroughout 2008,a number of benefi ci ati on tri al s on GemDi amonds producti on were undertaken.A total of 714 caratsof top qual i ty whi te

116、 and fancy yel l ow di amonds were extractedfrom both Leteng and Ki mberl ey s run of mi ne producti on.These di amonds were anal ysed,cut and pol i shed by Matri xDi amond Technol ogy and Cal i brated Di amonds on a tri albasi s i nto 257 carats of pol i shed di amondsat an average yi el dof 36%.A

117、total of 109 top qual i ty whi te and fancy yel l owcarats were sol d duri ng 2008,achi evi ng an average US dol l arper carat of US$101 000 and US$29 000,respecti vel y.Al lpol i shed di amond sal es to date have been on tender i nAntwerp.The pol i shed di amonds sol d pri or to the rapi ddecl i ne

118、 i n di amond pri ces i n October 2008,achi evedsi gni fi cant addi ti onal margi ns.As a resul t of the downturn l atei n 2008,and the deci si on to defer Leteng s December tender,a total of 228 carats of pol i shed di amonds,was hel d over forsal e i n 2009.I n August 2008 Gem Di amonds secured th

119、e servi ces of the foundi ng executi ves of Matri x Di amond Technol ogy,together wi th a team of engi neers and master pol i shers,to establ i sh and operate a Gem Di amonds benefi ci ati onfaci l i ty.Thi s hi gh tech faci l i ty uses sophi sti cated roughdi amond mappi ng and anal ysi s technol o

120、gy to anal yse,cutand pol i sh the hi ghest qual i ty+10.8 carat rough di amonds.I n September 2008,Gem Di amonds acqui red Cal i bratedDi amonds for US$5.9 mi l l i on,together wi th i ts state-of-the-art di amond processi ng assets,i ntel l ectual property andmanagement experti se.Cal i brated Di

121、amonds makes use of a propri etary technol ogy process and computer software to manufacture perfectl y symmetri cal di amonds to a hi ghdegree of accuracy that requi re mi ni mal manual pol i shi ng.Theprocess reduces cutti ng and pol i shi ng ti me,maxi mi ses thepol i shed yi el d and produces sym

122、metri cal pol i shed di amondsto a very hi gh and consi stent standard.The addi ti on of Cal i brated Di amonds advanced propri etaryl aser cutti ng technol ogy and management experti se,wi l lcompl i ment the sophi sti cated Matri x Di amond Technol ogyrough di amond mappi ng and anal ysi ng.The i

123、mpl ementati onof these bene fi ci ati on proj ects has been del ayed due to theworl d economi c cri si s and consequent pressures on capi talavai l abi l i ty.Annual Report 200811OUTLOOKGem Di amonds conti nues to bel i eve that the medi um tol ong term trend for i ncreased demand for qual i ty di

124、amondsremai ns i ntact because of the gl obal i sati on of the di amondengagement ri ng concept,the i ncrease i n Hi gh Net WorthI ndi vi dual s(HNWI s)rel ati ve porti on of gl obal weal th as wel las the economi c growth and urbani sati on of emergi ngBrazi l,I ndi a and Chi na(BRI C)economi es.Th

125、e l ong termposi ti ve outl ook for di amonds i s further underpi nned bywhat al l the mai n producers and market commentatorsrecogni se as a l ong term suppl y demand i mbal ance.Recentfal l s i n demand have prompted a response from the suppl ysi de,wi th the l arger producers,notabl y De Beers,an

126、nounci ngmaj or producti on cuts and Al rosa announci ng a hal t totradi ng.Fundi ng constrai nts are i nhi bi ti ng smal l er producersfrom conti nui ng to run l oss-maki ng operati ons for anyextended peri od thereby reduci ng the suppl y from theseoperati ons.Rapi d reducti ons i n hi gher cost p

127、roducti on,ongoi ng curtai l ments i n expl orati on expendi ture and thedeferral or cancel l ati on of numerous growth proj ects are al ll i kel y to l i mi t the extent to whi ch di amond i nventori es arebui l t-up and wi l l contri bute to even greater suppl y-si deconstrai nts when demand from

128、devel oped and devel opi ngeconomi es i ncreases,as i t i nevi tabl y wi l l.Combi ned wi thwhat Gem Di amonds vi ews as the l ong term posi ti ve suppl ydemand trends,these ci rcumstances shoul d resul t i n hi gheraverage di amond pri ces over the l ong term than are currentl ybei ng experi enced

129、or were experi enced i n l ate 2008.The Di rectors of Gem Di amonds have moved swi ftl y to meetthe new chal l enges caused by recent economi c turbul ence.Gem Di amonds i s focussi ng on i ts strongest produci ng assets,the Leteng Mi ne i n Lesotho and the El l endal e 9 pi pe at theEl l endal e mi

130、 ne i n Austral i a.Gem Di amonds wi l l conti nue toconserve cash i n the short term through reduced expendi tureon expl orati on and resource devel opment and cut-backs on al lnon-essenti al capi tal expendi ture.These efforts combi ned wi ththe pl aci ng to rai se approxi matel y US$107 mi l l i

131、on announced1 Apri l 2009,wi l l posi ti on Gem Di amonds to emerge from thecurrent economi c downturn i n a posi ti on to take advantage ofthe anti ci pated medi um to l ong term shortage of qual i tyrough di amonds.Clifford ElphickChief Executive Officer1 Apri l 2009Chief Financial Officers Review

132、 Annual Report 200812KEY FI NANCI AL RESULTS 200820082007Pre-exceptionalExceptional(US$mi l l i on)itemsitemsTotalRevenue296.9296.9152.7Cost of sal es(167.7)(20.5)(188.2)(44.2)Royal ty and sel l i ng costs(27.1)(27.1)(16.6)Corporate expenses(19.1)(1.8)(20.9)(17.4)Share of l oss of an associ ate(1.0)

133、EBI TDA(1)83.0(22.3)60.773.5Depreci ati on(41.6)(41.6)(7.6)Amorti sati on(19.4)(19.4)(13.0)Share based payments(10.4)(10.4)(19.5)I mpai rment(546.5)(546.5)Forei gn exchange gai n(19.4)(19.4)14.7Fi nance i ncome(0.1)(0.1)20.1Profi t before tax(7.9)(568.8)(576.7)68.4(1)EBI TDA unl ess i ndi cated to t

134、he contrary,i s before excepti onal i tems and share based payments.Excepti onal i tems are si gni fi cant i tems of i ncomeand expense whi ch due to thei r nature or expected i nfrequency are presented separatel y i n the I ncome Statement.TRADI NG CONDI TI ONSDuri ng the year,market condi ti ons f

135、or the sal e of di amondswere hi ghl y vari abl e.The fi rst hal f of the year saw strongdi amond pri ce growth,wi th record pri ces achi eved on sal esof rough di amonds from the Leteng,El l endal e and Cempakami nes.Up to the thi rd quarter,di amond pri ces si gni fi cantl youtperformed most asset

136、 cl asses and commodi ti es despi tethe emergi ng gl obal economi c cri si s.The l ast quarter of the year saw rough di amond pri ces decl i ne dramati cal l y.TheCompany consi ders thi s pri nci pal l y to be the resul t of a seri esof rel ated events:cThe gl obal economi c cri si s deepened duri n

137、g the courseof the year and pl aced severe l i qui di ty constrai nts onthe banki ng sector;cThi s i n turn severel y curtai l ed fi nanci al l i qui di ty i n thedi amond pi pel i ne,most notabl y i n the tradi ng andmanufacturi ng busi nesses,restri cti ng the capaci ty ofthese busi nesses to grow

138、 i nventory;andcLastl y,the reducti on i n consumer demand created con cerns that l arge amounts of di amond j ewel l eryi nventory i n retai l stores on consi gnment,woul d bereturned,further reduci ng demand.The combi ned effect of these and other rel evant factors wasthat rough di amond pri ces a

139、cross the i ndustry dropped byan esti mated 50%from pri ces prevai l i ng i n earl y 2008.Throughout thi s peri od,Gem Di amonds sought new waysto market i ts producti on more effecti vel y.An offtakeagreement for the hi gh qual i ty yel l ow di amond producti onfrom El l endal e was entered i nto,l

140、 ower qual i ty El l endal egoods were sol d on el ectroni c aucti on and di rect sal esavenues were sought for other producti on.Rough di amond pri ces achi eved across the Group s operati ngmi nes were between 7 and 34%hi gher than i n 2007,notwi thstandi ng the rapi d decl i ne i n di amond pri c

141、es by upto 70%i n some categori es between the fi rst and fourthquarter of 2008.Annual Report 200813FI NANCI AL PERFORMANCEThe fol l owi ng i s a revi ew of the key i tems of the GroupI ncome Statement:Revenue of US$296.9 mi l l i on was generated i n 2008 fromthe sal e of rough di amonds recovered

142、at Leteng,El l endal eand Cempaka as wel l as the sal e of pol i shed di amondsmanufactured i n benefi ci ati on tri al s.Royal ti es and sel l i ng costs of 9%rel ate predomi nantl y to a2.5%commi ssi on pai d to agents based i n Antwerp,as wel l asroyal ti es of between 5 8%payabl e to the Lesotho

143、 RevenueAuthori ty,Austral i an Tax Offi ce and I ndonesi an Governmenton the recovery of di amonds i n these respecti ve terri tori es.Cost of sal es for the year,before excepti onal i tems,wereUS$167.7 mi l l i on before non-cash costs of depre ci ati on of US$41.6 mi l l i on and amorti sati on o

144、n mi ni ng assets ofUS$19.4 mi l l i on.Costs i n US dol l ar associ ated wi th mi ni ng andrecoveri ng di amonds decl i ned over the course of the peri od.Despi te US dol l ar weakness earl i er i n the year,the LesothoMal oti (pegged to the South Afri can Rand)and the Austral i andol l ar both dev

145、al ued si gni fi cantl y agai nst the US dol l ar l ater i nthe year,effecti vel y reduci ng US dol l ar i nput costs.EXCHANGE RATESAs atAs atand for theand for theyear endedyear ended31 December31 December20082007Lesotho Mal otiper US$1.00Average rate8.267.05Year end rate9.256.83Austral i an dol l

146、arper US$1.00Average rate1.181.19Year end rate1.431.14From i ts peak i n Jul y 2008,the subsequent decl i ne i n the oi l pri ce al so resul ted i n l ower fuel costs i n the l atter part ofthe year.Corporate expenses rel ate to central costs i ncurred by Gem Di amonds and i ts servi ces subsi di ar

147、y Gem Di amondTechni cal Servi ces.Central costs were i n l i ne wi th thosebudgeted for the year and are expected to be si gni fi cantl yreduced i n 2009.Excepti onal i tems rel ate to i mpai rment of assets,refl ecti ngthe wri te down i n the val uati on of certai n subsi di arycompany assets and

148、i nvestments,i nventory wri te downs tonet real i sabl e val ues due to reduced di amond val ues at yearend,restructuri ng and cl osure costs as wel l as the once offcosts rel ati ng to the acqui si ti on and establ i shment of theGroup s benefi ci ati on operati ons.These are di scussed i nmore det

149、ai l bel ow.Forei gn exchange l osses rel ate to real i sed and unreal i sedl osses on funds hel d i n currenci es other than US dol l ar,aswel l as hedges entered i nto by Leteng Di amonds andKi mberl ey Di amonds to protect agai nst ri si ng US dol l ardenomi nated costs.As set out i n the Company

150、 s Prospectus,the Company i s authori sed to i ssue up to 2.5%of shares i n i ssue at I PO Admi ssi on(i.e.2.5%of 57 865 209)to non-Executi veDi rectors of whi ch 1.75%(1 012 644)have been al l ocated to date.US$18.9 mi l l i on of the total tax charge before excepti onali tems rel ates to corporate

151、 i n come tax and wi th hol di ng taxespai d by the Group to the rel evant revenue authori ti es.Thebal ance before excepti onal i tems of US$4.4 mi l l i on rel atesto deferred tax.Mi nori ty i nterests predomi nantl y represent the 30%of the profi ts i n Leteng Di amonds whi ch are attri butabl e

152、to the Company s partner,the Government of Lesotho as wel l as the porti on of the i mpai rment of P.T.Gal uhCempaka s book val ue that i s attri butabl e to thi s company smi nori ty sharehol ders.Losses attri butabl e to sharehol ders for the year wereUS$31.3 mi l l i on equati ng to 74 US cents p

153、er share on awei ghted average basi s before excepti onal i tems.The i mpactof excepti onal i tems resul ted i n a total l oss attri butabl eChief Financial Officers Review continuedAnnual Report 200814to share hol ders of 884 US cents per share.The wei ghtedaverage number of shares i n i ssue duri

154、ng the year was 62.6 mi l l i on.At year end there were 62.9 mi l l i on shares i n i ssue.SEGMENTAL FI NANCI AL PERFORMANCELetengKi mberl eyP.T.Gal uhUS$(mi l l i ons)Di amondsDi amondsCempakaSal es188.8 99.58.0Cost of Sal es(1)55.288.623.6Royal ty andsel l i ng costs20.75.80.6EBI TDA112.95.2(16.3)

155、Average pri ce per ct2 123185233Cash cost per ct763.4210.7555.4Cash cost per tonne11.6914.1615.61(1)Excl udi ng depreci ati on,on mi ne amorti sati on and excepti onal i tems.Leteng Di amonds revenue grew by 24%to US$188.8 mi l l i onas a resul t of producti on and pri ce i ncreases and the sal e of

156、the Li ght of Leteng at US$38 400 per carat.The average pri ceper carat achi eved was US$2 123 rel ati ve to US$1 977 i n 2007.Cost of sal es rose because of i ncreased producti on,but costsper tonne decl i ned rel ati ve to 2007 due to weaker averageoperati ng currency and i ncreased throughput.I n

157、comestatement uni t costs i n 2008 dropped to US$10.27 per tonnefrom US$13.79 per tonne i n 2007.Cash costs per tonnedecl i ned from US$14.39 per tonne i n the fi rst hal f of 2008 toUS$9.72 per tonne i n the second hal f of 2008,resul ti ng i n anoveral l cash cost per tonne of US$11.69 for the ful

158、 l year.Thecurrent tax charge i s i n l i ne wi th the corporate i ncome tax rateof 25%i n Lesotho.Ki mberl ey Di amonds sol d di amonds i n 2008 for the fi rstti me si nce the acqui si ti on by Gem Di amonds.Overal ldi amond pri ces for the year of US$185 per carat are 34%hi gher than those achi ev

159、ed pri or to the company s acqui si ti on.I ncome statement uni t costs i n the second hal f of 2008dropped to US$12.86 per tonne from US$21.80 per tonnei n the fi rst hal f,l argel y as a resul t of the deval uati on of theAustral i an dol l ar agai nst the US dol l ar i n the second hal f of 2008,

160、the decl i ne i n the oi l pri ce and an i ncrease i nthroughput.Si mi l arl y,cash costs per tonne decl i ned fromUS$15.61 per tonne i n the fi rst hal f to US$12.99 per tonne i nthe second hal f of 2008.For the ful l year,cash costs pertonne were US$14.16.Ki mberl ey Di amonds currentl y has tax l

161、 osses of US$136.5 mi l l i onwhi ch may be uti l i sed agai nst future profi ts.No deferred taxassets have been recogni sed i n respect of these l osses.Li mi ted revenue was generated by PT Gal uh Cempaka,where the mi ne was onl y i n operati on for seven months ofthe year.Di amonds sol d for US$2

162、33 per carat duri ng theyear,an i ncrease of 7%over the pri or peri od.Operati ng costsat Cempaka were hi gh rel ati ve to producti on due to the factthat duri ng the suspensi on of mi ni ng acti vi ti es i n the mi ddl eof the year,the ful l staff compl ement was kept on the payrol l.Pri ces for Ce

163、mpaka di amonds decl i ned to bel ow thei resti mated future cost of producti on i n l ate 2008 resul ti ng i nthi s operati on bei ng put on care and mai nte nance fromJanuary 2009 unti l further noti ce.I MPAI RMENTS AND EXCEPTI ONAL I TEMSThe Group s strategy of accel erated growth i n a constrai

164、 nedsuppl y and i ncreased demand market has resul ted i ni nvest ments i n operati ng mi nes and expl orati on and resourcedevel opment proj ects.The Group undertakes i mpai rment testi ng annual l y,orwhen ever events or changes i n ci rcumstances i ndi cate that the carryi ng val ue of an asset m

165、ay not be recoverabl e.An i mpai rment test i nvol ves compari ng the val ue i n use of an asset wi th i ts carryi ng val ue.I n determi ni ng val ue i nuse,the Group uses assumpti ons i ncl udi ng the expectedcarats recoverabl e,expected grades achi evabl e,expectedpl ant throughput and costs of ex

166、tracti ng and processi ng,expected pri ces per carat achi evabl e on sal e and appropri atedi scount rates.As a resul t of decl i ni ng market pri ces for rough di amonds,the Group determi ned that certai n of i ts operati ons werenot economi cal l y sustai nabl e at current pri ces.A revi ew ofthes

167、e carryi ng val ues was undertaken at year end.The resul tAnnual Report 200815the extent that market condi ti ons i mprove and to the extentpermi tted by accounti ng standards.GROUP TAXATI ONThe I ncome Statement tax charges of US$26.8 mi l l i onmai nl y rel ate to taxati on charged on the profi t

168、generatedat Leteng Di amonds.A further US$4.2 mi l l i on of taxati onarose i n respect of wi thhol di ng taxes charged on extracti ngdi vi dends from Lesotho.Al though the Group has i ncurred a l oss duri ng the year,the i mpact of the tax charge i n Leteng Di amonds and thewi thhol di ng tax on th

169、e di vi dends from Leteng Di amondsresul ted i n a total Group tax charge of US$23.3 mi l l i on.I n accordance wi th I FRS,deferred tax assets have not beenrecogni sed i n respect of the l osses ari si ng of Ki mberl eyDi amonds and Cempaka.Tax credi ts of US$47.9 mi l l i onpredomi nantl y rel ate

170、 to the goodwi l l assets that have beeni mpai red i n the DRC and Cempaka.CASHCash on hand at the begi nni ng of the year of US$181.8 mi l l i onwas suppl emented by cash fl ow from operati ons for the year of US$88.1 mi l l i on.After i nvestments i n property,pl antand equi pment of US$137.8 mi l

171、 l i on,predomi nantl y rel ati ng tothe second pl ant at the Leteng mi ne,capi tal i mprovements atKi mberl ey Di amonds,i nvestment i n resource devel opmentcosts i n the DRC,CAR and Botswana,i nvestments i n theCompany s newl y establ i shed cutti ng and pol i shi ng busi nessesof US$93.4 mi l l

172、i on and i nvestments i n waste stri ppi ng ofUS$44.4 mi l l i on,cash at year end was US$61.4 mi l l i on.Of thi sUS$51.9 mi l l i on i s attri butabl e to the Group.DEBTAs at year end the Group had outstandi ng debt of US$41.7 mi l l i on.Of thi s US$16.1 mi l l i on rel ates to con-verti bl e bon

173、ds that mature i n October 2009.The bul k of theremai ni ng debt rel ates to a l oan and securi ty extended by Soci t Gnral e to Ki mberl ey Di amonds,a si gni fi cantporti on of whi ch was i n pl ace pri or to Gem Di amondsacqui si ti on of thi s company.of thi s was i mpai rments to assets after t

174、ax and mi nori ti esacross the Group of US$484.0 mi l l i on,the detai l of whi ch i sas fol l ows:US$(mi l l i ons)I mpai rmentAustral i a Ki mberl ey Di amonds233.8I ndonesi a PT Gal uh Cempaka 71.9CAR Mambr 17.4DRC Mbel enge,Lubembe,Longatshi mo160.9The resource and expl orati on costs and assets

175、 i n the DRC andCAR amounti ng to US$208.3 mi l l i on were i mpai red,i ncl udi nggoodwi l l of US$26.1 mi l l i on,as a resul t of the deci si on taken i nNovember 2008 to pl ace al l al l uvi al expl orati on acti vi ti es i n theDRC and CAR on care and mai ntenance.I n January 2009,the Cempaka m

176、i ne was pl aced on care andmai ntenance.I t i s consi dered unl i kel y that di amond pri ceswi l l recover suffi ci entl y i n the short to medi um term suchthat Cempaka coul d return to operati on,i ndi cati ng that aful l i mpai rment on the goodwi l l and mi ni ng assets be takenat the end of 2

177、008 amounti ng to US$95.3 mi l l i on.Ki mberl ey Di amonds key asset the El l endal e mi ne has twol amproi te pi pes on whi ch mi ni ng has taken pl ace to date the El l endal e 4 and the El l endal e 9 pi pes.Due to i ts l owerrevenue per tonne profi l e,El l endal e 4 mi ni ng ceased i nFebruary

178、 2009 and the pl ant was pl aced on care andmai ntenance.Mi ni ng on the El l endal e 9 pi t conti nues.Thecurrent pri ci ng envi ronment,together wi th the mi ni ng costs at the El l endal e mi ne prompted the Group to i mpai r thi s asset by US$242.9 mi l l i on.Thi s i ncl udes goodwi l l ofUS$25

179、.8 mi l l i on.The bul k of the bal ance of thi s i mpai rmentrel ates to mi ni ng assets and capi tal i sed deferred stri ppi ngat both El l endal e 4 and El l endal e 9 pi pes and capi tal assetsat El l endal e 4.Notwi thstandi ng the i mpai rment charges,the Group has notrel i nqui shed any of i

180、ts l i cences,tenements,assets or properti es.The Group wi l l conti nue to test i ts other assets for i mpai r mentat l east on an annual basi s and may i n future record addi ti onali mpai rment charges or reverse any i mpai rment charges toChief Financial Officers Review continuedAnnual Report 20

181、0816CAPI TAL RAI SI NGI n l i ght of the tradi ng ci rcumstances and the Group sobl i gati ons to settl e i ts short term debt,the Di rectors bel i evethat the Group wi l l requi re addi ti onal capi tal fundi ng.The Di rectors have proposed to rai se equi ty capi tal by way of a pl aci ng of shares

182、 to exi sti ng and strategi c share-hol ders to meet these l i abi l i ti es and to create a sui tabl ecapi tal structure.The Company i ntends to pl ace 75 mi l l i on shares at 100 penceper share,a di scount of 33%to the cl osi ng pri ce of theCompany s shares on 31 March 2009(the Pl aci ng).The Pl

183、 aci ngi s subj ect to amongst other thi ngs,sharehol der approval i n ageneral meeti ng.Shoul d the Pl aci ng succeed,the Company expects to rai seUS$98 mi l l i on net of expenses.Shoul d the Pl aci ng not succeed,the Company coul d seek tonegoti ate an extensi on of payment on both i ts converti

184、bl ebonds and Ki mberl ey Di amonds outstandi ng Soci tI NVENTORYGroup di amond i nventory whi ch i s val ued at the l ower ofcost or net real i sabl e val ue at year end was US$22.0 mi l l i on,down from US$24.9 mi l l i on at the pri or year end.Physi caldi amond i nventori es at both Leteng and E

185、l l endal e weresi gni fi cantl y hi gher at the end of 2008 than at the end of2007 due to producti on ramp ups at both operati ons as wel lthe deferral of the Leteng December tender to 2009.A wri tedown i n di amond i nventory val uati on and ore stockpi l es ofUS$19.3 mi l l i on was made at year

186、end,i n l i ne wi th decreasi ngdi amond pri ces and the i mpl ementati on of the El l endal e 4care and mai ntenance pl an.ACQUI SI TI ONSDuri ng the peri od,the Company acqui red Cal i bratedDi amonds for US$5.9 mi l l i on.I n addi ti on to thi s a furtherUS$0.8 mi l l i on was expended on set up

187、 costs rel ati ng to Cal i brated Di amonds and Gem Di amonds Technol ogyDubai DMCC,al l of whi ch were charged to the i ncomestatement.1The gl obal economi c cri si s and i ts i mpact on consumer preferences and expendi ture.2The short term i mbal ance between demand and suppl y and the i mpact tha

188、t thi s has on the di amond pi pel i ne.3A potenti al l ack of fundi ng for the Group to exti ngui sh debt due i n 2009.4An i nabi l i ty to sel l producti on at or above break even poi nt,resul ti ng i n i nadequate cash fl ow to sustai n operati ons.5A maj or producti on i nterrupti on at ei ther

189、Ki mberl ey Di amonds or Leteng Di amonds.6A maj or heal th,safety and envi ronmental i nci dent.7A change i n consumer preferences away from di amonds due to negati ve senti ment towards di amonds and/or di amond mi ni ng.KEY GROUP RI SKSI n 2008,the Board and Senior Executives considered the posit

190、ion of the Group and the potential risks to achieving its stated strategy.The following key risks were identified:Annual Report 200817Gnral e borrowi ngs.I n the current economi c and fi nanci alenvi ronment,the cost of extendi ng such faci l i ti es,assumi ngthey are capabl e of bei ng extended,wou

191、l d be expensi ve,andmost l i kel y woul d resul t i n the i mposi ti on of si gni fi cantl y moreonerous obl i gati ons on the Group.Al ternati vel y the Company may be abl e to access al ternati vefunds,whether i n the debt or equi ty capi tal markets or byother thi rd party borrowi ngs for the pu

192、rposes of repayi ngi ts l i abi l i ti es.A further opti on avai l abl e to the Companymi ght be to enter i nto offtake agreements at Leteng andEl l endal e at pri ces that can sustai n these operati ons for thenear to medi um term.GOI NG CONCERNThese fi nanci al statements have been prepared on a g

193、oi ngconcern basi s whi ch assumes that the Group wi l l be abl e tomeet i ts l i abi l i ti es as they fal l due for the foreseeabl e future.As detai l ed i n thi s report,the current economi c envi ronmenti s chal l engi ng and the Group has reported an operati ng l ossfor the year.Agai nst the ba

194、ckground of the current di ffi cul ttradi ng condi ti ons,the Di rectors bel i eve that the Group wi l lrequi re addi ti onal funds i n order to meet i ts l i abi l i ti es as theyfal l due.I t i s agai nst thi s background that the Di rectors areproposi ng to rai se equi ty capi tal by way of the P

195、l aci ng torai se funds to meet these obl i gati ons and to create a sui tabl ecapi tal structure to posi ti on the Group s key operati ons tosurvi ve a prol onged economi c downturn.I n order for the Pl aci ng to succeed,the approval ofshare hol ders i n a General Meeti ng,amongst other thi ngs,i s

196、 requi red.Al though al ternati ve strategi es for the Grouphave been consi dered by the Board shoul d the capi talrai si ng not succeed,the Di rectors have concl uded thatthese ci rcumstances,represent a si gni fi cant materi aluncertai nty that casts a si gni fi cant doubt on the Group sabi l i ty

197、 to conti nue as a goi ng concern.Neverthel ess theDi rectors have a reasonabl e expectati on that the Group wi l lhave adequate fi nanci al resources to conti nue i n operati onalexi stence for the foreseeabl e future.For these reasons,theyconti nue to adopt the goi ng concern basi s i n prepari ng

198、 theannual report and accounts.Reference to thi s i s made i n theemphasi s of matter paragraph i n the Audi tors Report.GOVERNANCEGem Di amonds recei ves no fi nanci al assi stance from thegovernment of any country i n whi ch i t operates.No acti onsrel ati ng to anti-competi ti ve behavi our,anti-

199、trust and/ormonopol y practi ces have been taken agai nst Gem Di amonds.Kevin BurfordChief Financial Officer1 Apri l 2009Annual Resource and Reserve StatementAnnual Report 200818cTotal resource carats mai ntai ned at ci rca 33 mi l l i on carats.cTotal resource revenue has reduced by 7%to US$10.6 bi

200、 l l i on,due to the recent decl i ne i n di amond pri ces.c56%of i nventory and 41%of val ue i s at I ndi cated Resource l evel.cChanges i n the method of esti mati ng di amond resources has resul ted i n resource downgrades.The annual resource and reserve statements summari sed i n the fol l owi n

201、g tabl es are based on i ndependent resourcestatements provi ded by Venmyn Rand for al l of the Group s operati ons.The resource statement of 31 December 2008 i scompared to the previ ous Gem Di amonds resource statement dated 31 December 2007.Resources stated are ei ther SAMRECor JORC compl i ant a

202、s determi ned by Venmyn Rand.Val uati on of di amonds i s determi ned by val uati ons undertaken and actualsal e pri ces achi eved over the precedi ng 24 month peri od.Resources stated are i ncl usi ve of reserves and represent the total gl obal resource at zero cut-off grades.Recent changes to mi n

203、eral resource codes have resul ted i n a decrease i n confi dence and therefore a downward recl assi fi cati onof resources at El l endal e and Gope.Thi s downward recl assi fi cati on i s i n l i ne wi th Venmyn Rand s i nterpretati on of the revi sedSAMREC Code 2007 and/or Venmyn Rand s revi sed i

204、 nternal cl assi fi cati on checkl i st.At Gope,thi s downgrade was the resul t ofcl earer gui del i nes,provi ded for wi thi n the SAMREC Code 2007,concerni ng extrapol ati on bel ow sampl i ng depths.At El l endal ethe downgrade was the resul t of Venmyn Rand s mi ni mum requi rements for the quan

205、ti ty of di amonds recovered.The most si gni fi cant change i n the total resource statement i s the reducti on of total i n-si tu revenue by 7%.Thi s refl ects the decl i ne i n di amond pri ces achi eved at Leteng,El l endal e and Cempaka i n the l atter hal f of 2008.I t i s i mportant to notetha

206、t thi s 7%decl i ne i s based on the Venmyn Rand revenue esti mates and not the most recentl y achi eved pri ces as at 31 December 2008.I ncreases i n resources both i n the DRC and the CAR are as a resul t of resource devel opment undertaken i n the peri od.Reserves have been cal cul ated by an i n

207、-house Competent Person and i n compl i ance wi th SAMREC Code 2007.Changes to the reserve statement are the fi rst-ti me reporti ng of reserves for the El l endal e mi ne and the l oss of reserves at theCempaka mi ne.Ki mberl ey Di amonds previ ousl y decl i ned to report on reserves due to uncerta

208、i n mi ni ng costs and processi ngcapaci ty.The current mi ni ng method and costs at Cempaka together wi th di amond pri ces i ndi cate that no payabl e reservecan be defi ned for Cempaka.Annual Report 200819US$/ctCarats(m)Grade(cts/T)Ore(mT)US$/ctI n si turevenue(US$mm)Carats(m)Grade(cts/T)Ore(mT)U

209、S$/ctCarats(m)Grade(cts/T)Ore(mT)US$/ctCarats(m)Grade(cts/T)Ore(mT)AS AT 31 DECEMBER 2008CountryProbabl e reservesI ndi cated resourcesI nferred resourcesTotal resourcesAustralia El l endal e8.30.050.3929136.60.051.8216861.50.053.1415998.00.054.97162806 Bl i na0.80.040.034203.60.030.102454.40.030.13

210、28937Botswana Gope78.80.1914.9913626.50.164.30136105.30.1819.291362 625 CAR Mambr3.60.020.081493.60.020.0814912DRC Mbel enge 3.00.120.37913.00.120.379134 Longatshi mo4.40.241.061264.40.241.06126133 Lubembe0.51.260.631000.51.260.6310063 Tshi kapa DRC total7.90.262.051127.90.262.05112229I ndonesia Cem

211、paka17.90.020.381.9893.10.021.92177111.00.022.30180414Lesotho Leteng78.80.021.321 49978.90.0171.321 502160.10.0182.851 592239.00.0174.171 5636 516Total87.10.021.711 224213.10.0918.54238356.20.0414.44431569.30.0632.9832310 640 US$/ctCarats(m)Grade(cts/T)Ore(mT)US$/ctI n si turevenue(US$mm)Carats(m)Gr

212、ade(cts/T)Ore(mT)US$/ctCarats(m)Grade(cts/T)Ore(mT)US$/ctCarats(m)Grade(cts/T)Ore(mT)Annual Resource and Reserve Statement continuedAnnual Report 200820AS AT 31 DECEMBER 2007CountryProbabl e reservesI ndi cated resourcesI nferred resourcesTotal resourcesAustralia El l endal e57.60.063.2821547.60.052

213、.44256105.20.055.712321 328 Bl i na Botswana Gope97.10.1918.8813697.10.1918.881362 568 CAR Mambr3.50.010.051703.50.010.051708DRC Mbel enge 2.00.050.10832.00.050.10838 Longatshi mo5.40.201.041265.40.191.04126131 Lubembe0.50.610.29860.50.610.298625 Tshi kapa DRC total7.90.181.421157.90.181.42115164I n

214、donesia Cempaka4.10.060.2226110.20.040.4125977.00.032.2024787.20.032.61249650 Lesotho Leteng84.10.021.351 65484.10.021.351 654158.90.022.631 709243.00.023.981 6906 724 Total88.20.021.561 469249.00.1023.91234294.80.038.74668543.90.0632.6535011 441Annual Report 200821Resource Statement Leteng Diamonds

215、,Leteng mineAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESDepthDepthResourceRecov.ProcessMi nSourcefromtotypeVol umeSGTonnagegradectsVal uepl antcut-off(m)(m)(m3)(kg/m3)(cpht)(US$/ct)(mm)*Satel l i te pi pe0250I ndi cated6 326 0002.5816 321 0002.17354 9001 902DMS*2.00250656I nferred22 029 0002.5856

216、834 0002.171 235 8001 902DMS*2.00Subtotalsatellite pipe28 355 0002.5873 155 0002.171 590 7001 902Mai n pi pe028I ndi cated183 0002.46450 0001.265 6001 354Pan2.7028112I ndi cated9 650 0002.6125 186 0001.50377 0001 354DMS*2.00112196I ndi cated12 983 0002.6133 885 0001.61543 9001 354DMS*2.00196490I nfe

217、rred39 563 0002.61 103 259 0001.561 611 5001 354DMS*2.00Subtotalmain pipe62 379 0002.61 162 780 0001.562 538 0001 354ResourceRecov.ProcessMi nSourceStockpi l etypeVol umeSGTonnageGradectsval uePl antCut-off(m)(m3)(kg/m3)(cpht)(US$/ct)(mm)*Stockpi l eDe BeersI ndi cated1 299 0002.032 632 0001.2633 00

218、01 354Pan2.70Al l uvi al Venturesoversi ze stockpi l e(Mai n pi pe)I ndi cated197 0001.68330 0001.264 1001 354DMS*2.00Mai n pi pe l owgrade stockpi l eI ndi cated10 0001.6816 0001.432001 354DMS*2.00Satel l i te ROMstockpi l eI ndi cated10 0001.6816 0002.173001 902DMS*2.00Crushed orestockpi l eI ndi

219、cated52 0001.6887 0002.141 8001 875DMS*2.00Subtotalstockpile1 568 0001.963 081 0001.2839 4001 382Grand total/average92 302 0002.59 239 016 0001.744 168 1001 564Notes:(1)I ncl usi ve of Reserves.(2)Grades quoted as pre-aci d wash.(3)*22 mm re-crush screen aperture wi dth.(4)*At 31 December 2008 the c

220、rushed ore stockpi l e i s compri sed of 95 per cent.Satel l i te pi pe and 5 per cent.Mai n pi pe.(5)Roundi ng down of vol ume and tonnage to the nearest 1 000 t and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(6)The di amond pri ce i s esti mated usi ng the Dr.Lemm

221、er pri ce curve usi ng sal es data from January 2007 December 2008,from producti on sourcedfrom each pi pe separatel y.These do not refl ect spot pri ces currentl y bei ng obtai ned by the mi ne,but do take i nto account the pri ce si nce the gl obaleconomi c downturn i n September 2008.Annual Resou

222、rce and Reserve Statement continuedAnnual Report 200822Reserve Statement Leteng Diamonds,Leteng mineRESERVES AS AT 31 DECEMBER 2008Recov.ProcessBottomSourceReserve typeVol umeSgTonnagegradeCtsVal uepl antscreen si ze(m3)(kg/m3)(cpht)(US$/ct)(mm)Satel l i te pi pe0 to 250 mProbabl e6 299 0002.5816 25

223、2 0002.14347 7931 902DMS*2.00Subtotalsatellite6 299 0002.5816 252 0002.14347 7931 902Mai n pi pe0 to 28 mProbabl e183 0002.46452 0001.265 6811 354Pan2.7028 to 196 mProbabl e22 613 0002.6159 021 0001.57928 8391 354DMS*2.0022 796 0002.6159 473 0001.57934 5201 354Stockpi l esDe Beers stockpi l eProbabl

224、 e1 299 0002.03 2 634 0001.26 33 1051 354Pan2.70Al l uvi al Venturesoversi zestockpi l e(mai n pi pe)Probabl e197 0001.68 331 0001.26 4 1601 354Pan2.70Mai n pi pe l owgrade stockpi l eProbabl e10 0001.68 17 0001.43 2421 354DMS*2.00Satel l i te ROMstockpi l eProbabl e10 0001.68 17 0002.14 3641 902DMS

225、*2.00Crushed orestockpi l eProbabl e52 0001.68 88 0002.14 1 8831 875DMS*2.00Subtotalstockpile1 568 0001.973 087 0001.2939 7531 384Grand total/average30 663 0002.5778 812 0001.681 322 0661 499Notes:(1)Roundi ng of vol ume i s to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n co

226、mputati onal di screpanci es.(2)Di amond val ues are based on the Venmyn esti mati on methodol ogy.Annual Report 200823Resource Statement Kimberley Diamonds,Ellendale mineAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESBottomResourcescreen si zeSourcecl assi fi cati onTonnageGradeCaratsVal uecut-off(c

227、pht)(US$/ct)(mm)El l endal e 4Measured3 337 0007.60253 700991.20El l endal e 9 WestMeasured2 067 0005.27109 0002561.20El l endal e 9 EastMeasured384 0005.6021 5004461.20Total measured5 788 0006.64384 200163El l endal e 4I ndi cated18 246 0004.57833 400991.20El l endal e 9 WestI ndi cated7 719 0004.6

228、1355 5002561.20El l endal e 9 EastI ndi cated2 365 0004.40104 1004461.20ROM stockpi l esI ndi cated2 444 0005.92144 6001621.20Total indicated30 774 0004.671 437 600169El l endal e 4I nferred28 076 0005.141 444 500991.20El l endal e 4 Satel l i teI nferred16 481 0006.221 025 0001201.20El l endal e 9

229、WestI nferred4 684 0005.03235 7002561.20El l endal e 9 EastI nferred8 542 0003.88331 8004461.20Low grade stockpi l esI nferred3 697 0002.88106 400239Total inferred61 480 0005.113 143 400159Total resources98 042 0005.064 965 200162Notes:(1)Roundi ng of tonnage to the nearest 1 000 t and carats to the

230、 nearest 100 cts may resul t i n computati onal di screpanci es.(2)El l endal e 4 resource cal cul ated to depth of 130 m bel ow ori gi nal surface,El l endal e 9 resource cal cul ated to depth of 180 m bel ow ori gi nal surface,El l endal e 4 Satel l i te cal cul ated to 220 m bel ow ori gi nal sur

231、face.(3)Al l UBX(brecci a)materi al has been cl assi fi ed as I nferred Mi neral Resource,due to the i nherent uncertai nti es concerni ng grade di stri buti on of thi s l i thol ogy.(4)Ki mberl ey Di amonds conduct i n-house val uati ons on thei r parcel s whi ch can be demonstrated to have agreeme

232、nt wi th the actual pri ces fetchedat tenders.These i n-house val uati ons are therefore consi dered as a proxy for the market.Provenance pri ce was cal cul ated by assessi ng the wei ghtedaverage i n-house di amond pri ce for the past 24 months.Si nce these di amond pri ces represent a mi x of prod

233、ucti on,provenance val ues were esti matedby consi derati on of the ore spl i ts and percentage of carats contri buted by each source for a typi cal ore mi x that woul d resul t i n the same wei ghtedaverage di amond val ue.Si nce September 2008 the di amond market has experi enced a si gni fi cant

234、downturn rel ated to the 2008/2009 gl obaleconomi c cri si s.Neverthel ess,Venmyn Rand expect di amond pri ces to recover i n the medi um term and sti l l consi der these pri ces to refl ect reasonabl eexpectati ons of future pri ces,based on thei r current i nformati on.Annual Resource and Reserve

235、Statement continuedAnnual Report 200824Reserve Statement Kimberley Diamonds,Ellendale mineRESERVES AS AT 31 DECEMBER 2008Bottom ReserveRecov.screenSourcetypeVol umeSgTonnagegradeCtsVal uesi ze(m3)(kg/m3)(cpht)(US$/ct)(mm)El l endal e 9 WestProven801 0002.021 615 0005.1382 0002561.2El l endal e 9 Eas

236、tProven95 0001.99189 0005.1311 0004461.2Total proven896 0002.011 804 0005.2293 000279El l endal e 9 WestProbabl e2 179 0002.084 522 0004.93220 0002561.2El l endal e 9 EastProbabl e522 0002.011 048 0004.3345 0004461.2ROM stockpi l esProbabl e590 0001.52897 0003.3329 0003511.2Total probable3 291 0001.

237、966 467 0004.57294 000295Grandtotal/average4 187 0001.988 272 0004.71389 000291Notes:(1)Roundi ng of vol ume i s to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(2)Di amond val ues are based on the Venmyn Rand s esti mati on methodol ogy.Resour

238、ce Statement Blina DiamondsAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESI n Si tuI n Si tuover-gravelBottom GravelResourceburdenvol umeRecoveredDi amondscreenResource bl ockDeposi ttypecategoryvol umegradeCaratsval uesi ze(m3)(m3)(ct/100m3)(US$/ct)(mm)E9 North WesternchannelE9Al l uvi alI ndi cated

239、60 00016 00029.324 6001621.0 1.5E9 North EasternchannelE9Al l uvi alI ndi cated66 00016 0009.111 4004261.0 1.5E9 Far EastE9El uvi alI ndi cated01 99610.942004661.0 1.5Total alluvialindicated126 00033 99618.246 200231Cut 2 Cut 1T5Al l uvi alI nferred3 422 000560 0003.6020 1002481.0 1.5Cut 1 E12T5Al l

240、 uvi alI nferred9 800 000612 0004.8929 9002481.0 1.5E12(Al l uvi al s)T5Al l uvi alI nferred1 387 000155 0006.9510 7004531.0 1.5E12(Upstreamextensi on)T5Al l uvi alI nferred800 000100 0006.956 9004531.0 1.5Total alluvialinferred15 409 0001 427 0004.7467 600302E9 Far EastE9Lamproi teI ndi cated0376 0

241、006.7825 4004661.0 1.5Total lamproiteindicated0376 0006.7625 400466E11E11El uvi alI nferred264 000107 0000.697001801.0 1.5E7E7El uvi alI nferred2 380 000102 0003.994 000991.0 1.5E4 Satel l i teE4El uvi alI nferred087 00011.9310 3001201.0 1.5E4 Area 5E4El uvi alI nferred055 00023.2112 700991.0 1.5Tot

242、al eluvialinferred2 644 000351 0007.8927 700109Grand total Blina18 179 0002 187 9965.80126 900289Notes:(1)Roundi ng down of vol ume to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(2)Al l measurements through processi ng pl ants are carri ed ou

243、t usi ng tonnes.Densi ti es are measured i n most trenches.(3)Note that Al l uvi al and El uvi al deposi ts over a l amproi te i ncl udes the gravel l ag and 1.0 m i nto the footwal l.(4)Di amond pri ces are based upon the wei ghted average of val uati ons and/or sal es i n the l ast 24 months,excep

244、t for Terrace 5 whi ch i ncl udes a sal efrom Apri l 2006.Si nce September 2008 the di amond market has experi enced a si gni fi cant downturn rel ated to the 2008/2009 gl obal economi ccri si s.Neverthel ess,Venmyn Rand expect di amond pri ces to recover i n the medi um term and sti l l consi der t

245、hese pri ces to refl ect reasonabl eexpectati ons of future pri ces,based on thei r current i nformati on.Note that the average pri ces recei ved for parcel s sol d i n 2008/2009 refl ect acombi nati on of El l endal e 9 North West and El l endal e North East stones.Annual Report 200825Resource Stat

246、ement P.T.Galuh Cempaka,Cempaka mineAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESOver-BottomResourceburdenGravelStri pDi amondscreenPal eo-channelcategoryvol umevol umerati oGradeCaratsval ue si ze(m3)(m3)(m3:m3)(ct/100m3)(US$/ct)(mm)Danau SeranI ndi cated1 234 000127 0009.7217.5222 2002071.20Cempa

247、kaI ndi cated42 902 0006 516 0006.585.44354 6001971.20Total indicated44 136 0006 643 0006.645.67376 800197CempakaI nferred263 381 00033 439 0007.885.571 863 7001761.20Baruh BadaI nferred1 122 0001 034 0001.095.5357 1002071.20Total inferred264 503 00034 473 0007.675.571 920 800177Total resources308 6

248、39 00041 116 0007.515.592 297 600180Notes:(1)Roundi ng of vol ume i s to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(2)Di amond val ue has been based on the average di amond val ues achi eved from di amond sal es over the past 24 months.Si nc

249、e September 2008 thedi amond market has experi enced a si gni fi cant downturn rel ated to the 2008/2009 gl obal economi c cri si s.Neverthel ess,Venmyn Rand expect di amondpri ces to recover i n the medi um term and sti l l consi der these pri ces to refl ect reasonabl e expectati ons of future pri

250、 ces,based on thei r current i nformati on.Resource Statement MambrAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESBottomResourceGravelGravelRec.Di amondscreenProj ect areacl assi fi cati ontypevol umegradeCaratsval uesi ze(m3)(ct/100m3)(US$/ct)(mm)RC-11I nferredRi ver Channel29 0003.209001601.6RC-16I

251、 nferredRi ver Channel60 00038.0022 8001601.6RC-17I nferredRi ver Channel37 00026.009 6001601.6RR-02I nferredRi ver Channel6 00046.002 7001601.6T1-R-01I nferredTerrace548 0003.0016 4001401.6T1-R-02I nferredTerrace92 0004.003 6001401.6T1-L-02I nferredTerrace101 0003.003 0001401.6T2-R-01I nferredTerra

252、ce268 0000.401 0001401.6T3-R-01I nferredTerrace190 0001.001 9001401.6T4 EastI nferredTerrace457 0004.0018 2001401.6Grand total/ave inferred resources1 788 0004.5080 100149Notes:(1)Roundi ng of vol ume to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanc

253、i es.(2)Recovered grades take i nto account vol ume l oss due to oversi ze and undersi ze materi al.(3)No di amond sal es have been made and no formal di amond val uati ons of the Mambr goods have been carri ed out.Di amond val ues have beenassumed based on compari sons wi th Di mbi goods whi ch hav

254、e consi stentl y averaged US$166/ct.Empi ri cal observati ons of the Mambr goods by ani ndependent val uator have suggested a pri ce range of between US$145/ct US$150/ct for the terrace di amonds.Si nce September 2008,the di amondmarket has experi enced a si gni fi cant downturn rel ated to the 2008

255、/2009 gl obal economi c cri si s.Neverthel ess,Venmyn expect di amond pri ces to recoveri n the medi um term and sti l l consi der these pri ces to refl ect reasonabl e expectati ons of future pri ces based on thei r current i nformati on.Annual Resource and Reserve Statement continuedAnnual Report

256、200826Resource Statement MbelengeAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESBottomResourceResourceGravelRecoveredscreenProj ect areabl ockTypecategoryvol umegradeCaratsVal uesi ze(m3)(ct/100m3)(US$/ct)(mm)Mbel enge-629KT-05TerraceI nferred427 00010.0042 700981.00Bar-98Ri verI nferred110 000174.00

257、191 400881.60El a Menj i I sl andsRi verI nferred63 00082.0051 600881.60Mbel enge-633KT-01TerraceI nferred279 0009.8027 300981.00KT-02TerraceI nferred159 0007.6912 200981.00KT-03TerraceI nferred125 00010.0012 500981.00KL-01Fl oodpl ai nI nferred303 0009.9730 200881.00KL-02Fl oodpl ai nI nferred55 00

258、01.901 000881.00Total inferred resources1 521 00024.27368 90091Total resources1 521 00024.27368 90091Notes:(1)Roundi ng of vol ume to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(2)Recovered grades take i nto account vol ume l oss due to overs

259、i ze and undersi ze materi al.For Bar 98,for exampl e,i t i s expected that onl y 25 per cent.of the i n-si tu gravel wi l l be processed.The al l ocated grade therefore refl ects actual recovered grades for thi s materi al.(3)Di amond val ues refl ect the wei ghted average val ues achi eved from di

260、 amond sal es(11 770.30 cts)duri ng the previ ous 24 months.Si nce KDC havean offtake agreement wi th Al mesta,who then sel l the di amonds on for a profi t,Venmyn Rand have esti mated the market val ue of the goods as therecei ved val ue pl us 10%.The val ue of the Ri ver and Fl oodpl ai n di amond

261、s have been esti mated to average US$10/ct l ess than that of the Terraces,based on thei r respecti ve si ze frequency di stri buti ons.Si nce September 2008,the di amond market has experi enced a si gni fi cant downturn rel atedto the 2008/2009 gl obal economi c cri si s.Neverthel ess,Venmyn Rand e

262、xpect di amond pri ces to recover i n the medi um term and sti l l consi der thesepri ces to refl ect reasonabl e expectati ons of future pri ces,based on thei r current i nformati on.Annual Report 200827Resource Statement LongatshimoAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESResourceBottomProj e

263、ctcl assi fi-GravelGravelRec.screenProj ectareacati ontypevol umegradeCaratsVal uesi ze(m3)(ct/100m3)(US$/ct)(mm)Longatshi mo 484Lupemba 3 T1I nferredFl ats+l ower44 00010.994 8001261.0Kamakenza 3 T1I nferredMi ddl e terrace17 00016.402 7001261.0Kanal T2I nferredFl ats+l ower88 00050.0644 0001261.0L

264、upemba ReachI nferredChannel139 000200.00278 0001261.0Longatshi mo 485Kamakel ekesseFl atsI nferredFl ats104 00012.9813 5001261.0Kamakel ekesseTri butaryI nferredTri butary243 00081.28197 5001261.0Kamakel ekesseC Kwango 485I nferredHi gh terrace34 00077.3526 3001261.0Kamakel ekesseNorth TerraceI nfe

265、rredHi gh terrace83 00086.2771 6001261.0Mwal i Tri butary485I nferredTri butary290 00066.00191 4001261.0Longatshi mo 487487 Left BankHi gh TerraceI nferredHi gh terrace83 00054.2245 0001261.0487 Left Bank Mi dTerraceI nferredMi d terrace86 00053.9546 4001261.0Kanal Low TerraceI nferredLow terrace24

266、00050.8312 2001261.0Kanal Hi gh TerraceI nferredHi gh terrace62 00075.0046 5001261.0487 North ReachTerraceI nferredMi d terrace23 00054.7812 6001261.0487 South ReachRB TerraceI nferredLow terrace59 00035.4220 9001261.0487 South ReachRB Fl atsI nferredFl ats3 00053.331 6001261.0Longatshi mo 1315Mwal

267、i Tri butary1315I nferredTri butary832 0005.0041 6001261.0Grand total/aveinferred resources2 214 00047.731 056 600Notes:(1)Roundi ng of vol ume to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(2)Recovered grades take i nto account vol ume l oss

268、 due to oversi ze and undersi ze materi al.(3)No di amond sal es have taken pl ace.The onl y other formal val uati on of these goods was done by WWW i n 2006 on 208 cts recovered from theterraces.From these di amonds a val ue of US$126/ct was determi ned.Si nce November 2008,the di amond market has

269、experi enced a si gni fi cantdownturn rel ated to the 2008/2009 gl obal economi c cri si s.Neverthel ess,Venmyn Rand expect di amond pri ces to recover i n the medi um term andsti l l consi der these pri ces to refl ect reasonabl e expectati ons of future pri ces,based on thei r current i nformati o

270、n.Annual Resource and Reserve Statement continuedAnnual Report 200828Resource Statement Lubembe AS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESResourceBottomTopProj ectcl assi fi-GravelGravelRec.Di amondscreenscreenProj ectareacati ontypevol umegradeCaratsval uesi zesi ze(m3)(US$/ct)(mm)(mm)LubembeTs

271、hambal uka 515ReachI nferredChannel36 00088.6131 9001001.616.0LubembeLona mai n 607channelI nferredChannel31 000102.5831 8001001.616.0Maxrock ReachI nferredRapi ds7 000212.8614 9001001.616.0LubembeLubembe 609 609Crossi ngI nferredChannel19 000500.0095 0001001.616.0Lufal anka Rapi dsI nferredRapi ds2

272、4 000500.00120 0001001.616.0Tshi mpul umbaReachI nferredChannel7 000500.0035 0001001.616.0Lubembe 609ReachI nferredChannel71 000340.00241 4001001.616.0Lubembe 630Katoka KwangoI nferredBasalKwango34 000163.5355 6001001.616.0Grand total/ave inferred resources229 000273.19625 600Notes:(1)Roundi ng of v

273、ol ume to the nearest 1 000 m3and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(2)Recovered grades take i nto account vol ume l oss due to oversi ze and undersi ze materi al.(3)Di amond val ues refl ect the wei ghted average val ues achi eved from di amond sal es(11 4

274、75.21 cts)duri ng the previ ous 24 months.Si nce KDC havean offtake agreement wi th Al mesta,who then sel l the di amonds on for a profi t,Venmyn Rand have esti mated the market val ue of the goods as therecei ved val ue pl us 10%.Si nce September 2008,the di amond market has experi enced a si gni f

275、i cant downturn rel ated to the 2008/2009 gl obaleconomi c cri si s.Neverthel ess,Venmyn expect di amond pri ces to recover i n the medi um term and sti l l consi der these pri ces to refl ect reasonabl eexpectati ons of future pri ces,based on thei r current i nformati on.Annual Report 200829Resour

276、ce Statement GopeAS AT 31 DECEMBER 2008 I NCLUSI VE OF RESERVESBottomResourceContai nedsi zecl assi fi cati onDepthFaci esVol umeDensi tyTonnageGradecaratsVal uecut-off(m)(m3)(t/m3)(cpht)(US$/ct)(mm)I ndi catedBase of crater 300 mTKB SE5 376 0322.5313 601 00028.133 826 0001471.5Base of crater 300 mT

277、KB Mai n8 533 7362.4721 078 00016.953 573 1001381.5Base of crater 300 mHK2 504 4192.596 486 00020.151 306 6001191.5Base of craterBXTKB723 0822.591 872 0009.91185 5001381.5 300 mBase of craterBXHK4 589 3112.6312 069 00010.961 322 7001191.5 300 mTotal/Ave21 726 5802.5455 106 00018.5410 213 900136I ndi

278、 cated300 400 mTKB SE2 202 7612.655 837 00029.461 719 8001471.5300 400 mTKB Mai n3 292 9092.508 232 00019.841 632 8001381.5300 400 mHK807 2182.622 114 00017.57371 3001191.5300 400 mBXTKB78 1132.60203 00018.5637 6001381.5300 400 mBXHK2 788 9392.637 334 00013.851 015 4001191.5Total/ave9 169 9412.5923

279、720 00020.144 776 900136Total/aveindicated30 896 5212.5578 826 00019.0214 990 800136I nferredNACrater3 168 6872.598 206 0005.02411 900133Total/ave3 168 6872.598 206 0005.02411 900133I nferred400 500 mTKB SE1 664 4682.664 427 00030.831 364 7001471.5400 500 mTKB Mai n3 031 4012.507 578 00019.001 439 8

280、001381.5400 500 mHK397 6112.621 041 00015.89165 4001191.5400 500 mBXHK2 004 6012.625 252 00017.50919 0001191.5Total/ave7 098 0822.5818 298 00021.253 888 900136Total/ave inferred10 266 7692.5826 504 00016.234 300 800136Total/ave inferred(excluding crater)7 098 0822.5818 298 00021.253 888 900136Grand

281、total/ave41 163 2902.56105 330 00018.3219 291 600136Grand total/ave(excluding crater)37 994 6032.5697 124 00019.4418 879 700136Notes:(1)Recoverabl e grade and carats based on a conventi onal di amond processi ng ci rcui t empl oyi ng crushi ng re-crushi ng and DMS.(2)Roundi ng of tonnage to the near

282、est 1 000 t and carats to the nearest 100 cts may resul t i n computati onal di screpanci es.(3)The most recent format di amond val uati on was done by WWW as at September 2008.Subsequent to thi s val uati on,the di amond market hasexperi enced a si gni fi cant downturn rel ated to the 2008/2009 gl

283、obal fi nanci al cri si s.Neverthel ess,Venmyn expect di amond pri ces to recover i n themedi um term and i n order to better refl ect thi s downturn,have di scounted these most recent val ues by 15 per cent.(whi ch equal s the effecti ve l ossi n val ue i n consi derati on of the average di amond v

284、al uati ons duri ng 2007 and 2008.Thi s effecti vel y represents,therefore a two-year average val ue.Sustainable Development ReportAnnual Report 200830At the core of Gem Di amonds operati onal phi l osophy andbusi ness practi ce,i s i ts commi tment to conti nuousl y exerci sea duty of care wi th re

285、gard to the heal th and safety of i tsempl oyees,proj ect-affected communi ti es,stakehol ders andthe general publ i c,as wel l as the envi ronment i n whi chi t operates.To thi s end,Gem Di amonds has i nsti tutedappropri ate Heal th,Safety,Corporate Soci al I ni ti ati ve(CSI )and Envi ronmental (

286、col l ecti vel y HSSE)pol i ci esand procedures that are i mpl emented throughout theorgani sati on.REPORT PARAMETERSThi s report coveri ng al l operati ons for the ful l 2008 year i sthe fi rst dedi cated Sustai nabl e Devel opment report publ i shedby Gem Di amonds si nce the Company s i ncepti on

287、 i n Jul y2005.I n an effort to conti nuousl y i mprove i ts HSSE reporti ng,thi s report i s al i gned wi th the reporti ng cri teri a as outl i ned i n the Gl obal Reporti ng I ni ti ati ve Versi on 3(GRI v3).Certai nPerformance I ndi cators(PI s),as referenced by thei r numberand category,have be

288、en sel ected for i ncl usi on i n thi s report and the Company has commi tted to i ncreasi ng overti me the number of PI s that are moni tored,recorded andreported on.PI s are i ndi cated throughout the report.The l evel of reporti ngi s i ndi cated as fol l ows:?Ful l reporti ng of PI?Parti al repo

289、rti ng of PI?Statement around PIPI categori es are abbrevi ated and referenced i n the report as fol l ows:EC:Economi c PI sEN:Envi ronmental PI sLA:Labour Practi ces and Decent Work PI sHR:Human Ri ghts PI sSO:Soci ety PI sPR:Product Responsi bi l i ty PI sMM:Mi ni ng and Metal s Sector Suppl ement

290、 PI sHSSE COMMI TTEE PROFI LE AND STRATEGYThe HSSE Commi ttee(the Commi ttee)compri ses thefol l owi ng members:cGA Beevers Chai rman(non-Executi ve Di rector)cM Sal amon(non-Executi ve Di rector)cGE Turner(Chi ef Legal and Commerci al Offi cer)1Achi evi ng zero fatal i ti es groupwi de.2Achi evi ng

291、 a Group Lost Ti me I nj ury Frequency Rate(LTI FR)of 0.50.3Ensuri ng that 100%of operati onal staff recei ve pre-empl oyment medi cal s.4Provi di ng vol untary counsel l i ng and testi ng for HI V/AI DS to maxi mi se coverage of empl oyees based on the speci fi c country ri sk and need.5Devel opi n

292、g and i mpl ementi ng an approved Soci al and Envi ronmental I mpact Assessment(SEI A)/Soci al and Envi ronmental Management Pl an(SEMP)for each operati on.6Devel opi ng and i mpl ementi ng a practi cal,si te speci fi c waste management pl an for each operati on.7Ensuri ng that the total l and di st

293、urbed does not exceed the mi ne and rehabi l i tati on pl ans and i s i ncompl i ance wi th the SEMP.8Devel opi ng and i mpl ementi ng a Corporate Soci al Re spon si bi l i ty and Sustai nabi l i ty strategy for eachsubsi di ary and the Group.9Formal i si ng CSI programmes and i nvestments at each o

294、perati on i n order to ensure al i gnment wi th the Group pol i cy.2009 KEY PERFORMANCE TARGETSAnnual Report 200831Al an Ashworth(Chi ef Operati ng Offi cer)i s i nvi ted to themeeti ng for reporti ng purposes,whi l e Andre Confavreux(Company Secretary)acts as the Commi ttee Secretary.The Commi ttee

295、 meets quarterl y wi th the purpose of assi sti ngthe Board i n obtai ni ng assurance that appropri ate systems are i n pl ace to deal wi th the management of heal th,safety,envi ron mental and communi ty rel ated ri sks and oppor tuni ti es.The Commi ttee reports di rectl y to the Board.HSSE SYSTEM

296、Gem Di amonds has i mpl emented and mai ntai ns a group-wi de HSSE system,underpi nned by i nternati onal standardsi ncl udi ng I SO,Worl d Bank and I nternati onal Fi nanceCorporati on(I FC)standards.Local l egi sl ati on perti nent toeach country i n whi ch operati ons are l ocated i s adhered to,

297、i ncorporated i nto and refl ected i n the country speci fi c HSSEstandards,procedures and staff trai ni ng.(LA6?)External HSSE AuditsI ndependent HSSE audi ts of al l the operati ons are conductedannual l y by I RCA Gl obal.El l endal e and the DRC operati ons both achi eved 2 Starrati ngs duri ng

298、the 2008 external I RCA audi ts,whi l e Letengachi eved a 3 Star rati ng.The fol l owi ng areas for i mprovement,whi ch were i denti fi edduri ng the 2008 audi ts,wi l l be addressed duri ng the 2009fi nanci al year:cEnhance HSSE l egal regi sters;cRefi ne basel i ne HSSE ri sk regi sters;cI mprove

299、HSSE management system structure and l evelof i ntegrati on;andcI ncrease control over correcti ve acti ons and cl ose outs.Health and Safety ReportA groupwi de LTI FR of 0.48 was achi eved i n 2008 wi th overei ght mi l l i on man-hours worked,thereby betteri ng theannual target,for the second year

300、 i n a row.Monthl y stati sti csare refl ected bel ow.(LA7?)These achi evements weremade possi bl e through conti nuous and rel evant heal th andsafety trai ni ng and awareness campai gns undertaken atevery l evel of the organi sati on,based on perti nent ri sk areas.Regrettabl y,one fatal i ty occu

301、rred at Gem Di amondsCentra fri que operati ons duri ng March 2008 when anexpl orati on sampl i ng pi t col l apsed.A detai l ed assessment ofthe causes of thi s acci dent was undertaken and contri butoryfactors i mmedi atel y addressed.(LA7?)As i n 2007,no occupati onal di seases were recorded duri

302、 ng2008.Mal ari a and other tropi cal di seases remai n a hi gh ri skat Afri can operati ons.The Group has contracted qual i fi edmedi cal and paramedi cal servi ce provi ders to ensure theprovi si on of a hi gh l evel of care to al l i ts empl oyees at theseoperati ons,wi th sui tabl e equi pment a

303、nd suppl i es avai l abl e onsi te.The i ntroducti on of the CyScope mal ari a testi ng machi nes,coupl ed wi th the provi si on of mosqui to nets and prophyl axeshave resul ted i n the si gni fi cant reducti on of l ost ti me from mal ari a.HI V/AI DSremai ns a heal th ri sk.Extensi ve HI V/AI DSaw

304、arenessand educati on campai gns conti nue,as does vol untary testi ng,treatment and condom di stri buti on.ECONOMI C SUSTAI NABI LI TY AND SOCI ETYData pertai ni ng to the Group s economi c sustai nabi l i ty i sreported i n the Chi ef Fi nanci al Offi cer s Report as wel l as theAnnual Fi nanci al

305、 Statements and notes thereto.(EC1?)Gem Di amonds has commi tted to vari ous l evel s of CSIspendi ng across i ts operati ons and several proj ects weresuccessful l y compl eted i n 2008.The operati ons are encouragedto spend avai l abl e CSI fundi ng on heal th,educati on,i nfrastructure devel opme

306、nt,the devel opment of smal l to medi um enterpri ses and general donati ons to rel evantcauses i n the proj ect-affected communi ti es.(MM1?)Sustainable Development Report continuedAnnual Report 200832CSI expendi ture duri ng 2008 was:cHeal thUS$29 000cEducati onUS$124 000cI nfrastructureUS$1 mi l

307、l i oncDonati onsUS$227 000cSME US$5 000cOtherUS$206 000Duri ng 2008,a total of 2 129 members of l ocal communi ti eswere treated at the si te cl i ni cs of the vari ous operati ons.Other CSI i ni ti ati ves i ncl ude the schol arshi p programme for15 terti ary students i n Lesotho,the compl eti on

308、of theKhubel u Val l ey ecotouri sm chal ets and campi ng faci l i ty nearthe Leteng mi ne,the constructi on of four school s and acl i ni c i n the DRC,the compl eti on of a school near the Li kayacamp i n CAR,the establ i shment of vari ous vegetabl e farmsand nurseri es near the Cempaka mi ne and

309、 the conti nuedski l l s trai ni ng and empl oyment of the Bunuba peopl e fromFi tzroy Crossi ng near the El l endal e mi ne.Vari ous otheri nfrastructure proj ects,i ncl udi ng roads and ferri es have beenconstructed i n the vi ci ni ty of the operati ons for use by boththe Group s operati ons and

310、the proj ect-affected communi ti es.Gem Di amonds has devel oped a seven step CSI process that i ncl udes a detai l ed sustai nabi l i ty needs anal ysi s process i n order for the proj ect-affected communi ti es to have more i nfl uence over CSI proj ects that are devel oped and i mpl emented.The p

311、rocess wi l l be i mpl emented at al loperati ng mi nes i n 2009.The CSI budget for each operati ondepends on the type of proj ect i denti fi ed and theassoci ated fundi ng requi rements.I t i s anti ci pated that thi sbottom-up approach wi l l ensure communi ty buy-i n fromthe earl i est stages of

312、the proj ects.Due to the onset of the gl obal economi c cri si s i n l ate 2008,several of Gem Di amonds operati ons were pl aced on care(1)LTI FR i s defi ned as l ost ti me i nj uri es for every 2 000 man hours workedAnnual Report 200833and mai ntenance.Ownershi p of the rel evant communi typroj e

313、cts was transferred to the l ocal communi ti es and thei rrespecti ve structures,l ocal government or reputabl e NGOs asdeemed appropri ate.I t i s i ntended that thi s wi l l ensure thei rconti nued benefi t to the proj ect-affected communi ti es.ENVI RONMENTAL SUSTAI NABI LI TYEnvi ronmental manag

314、ement takes a hi gh pri ori ty wi thi nGem Di amonds and appropri ate pol i ci es and procedureshave been i mpl emented to ensure that each operati oncan/wi l l compl y wi th I SO14001,Worl d Bank and I FC standards.Materials,Energy and WaterWater,di esel and oi l are the maj or raw materi al s used

315、 atGem Di amonds operati ons.Vol umes of these materi al sconsumed duri ng 2008 are detai l ed bel ow.(EN1?)Gem Diamonds maintains open communication channels with its project-affected communities.(MM11?)During 2008,Gem Diamonds undertook the SEI A for the proposed development of a mine at Gope in t

316、he CKGR.A project communication strategy was compiled and approved by the Government of Botswana prior tocommencement of the project.This strategy was based on the I FC Stakeholder Engagement(2007)and I FC DoingBetter Business through Effective Public Consultation and Disclosure(1998)guideline docum

317、ents.The EI A Act of Botswana required the Company to hold one public meeting during the scoping phase of the EI A project.Due to the lack of reliable local transport,Gem Diamonds conducted public meetings in eight locations in andaround the CKGR as part of the scoping phase of the project.Approxima

318、tely 590 people attended these meetingsand shared their thoughts,comments and concerns around the project with the team.These comments wereincorporated into the scope of the twelve specialist investigations that formed part of the SEI A and SEMP.Uponcompletion of the specialist investigations,a seco

319、nd round of feedback meetings were held with the projectaffected communities.Project-affected communities expressed their overwhelming support of the project andalso expressed their gratitude to the project team for the consultation process and the open and transparentmanner in which information was

320、 shared.A positive record of decision for the SEI A was granted by the Botswana Government in late 2008.Sustainable Development Report continuedAnnual Report 200834Water rel ated i mpacts(EN8?;EN9?)are l i mi ted i n thedi amond mi ni ng process and i t i s consi dered to be anextremel y cl ean mi n

321、i ng process.Chemi cal s used i n thedi amond mi neral processi ng,i ncl udi ng Ferrous Si l i con(FeSi),fl occul ants and coagul ants are i nert and stabl e.Therefore,very l i ttl e pol l uti on resul ts from the di amond mi ni ngprocess,and water rel ated i mpact i s general l y l i mi ted toi ncr

322、eased sedi mentati on where i nadequate settl i ng faci l i ti esare provi ded for.Potenti al l y aci d formi ng mi neral ogi es are sel dom associ atedwi th di amond deposi ts.However,at Cempaka,pyri te doesoccur i n the al l uvi al deposi t,l eadi ng to a natural l y l owground and surface water p

323、H,whi ch i n turn resul ts i n thedi ssol uti on of heavy metal s.Water qual i ty management i s aA variety of I UCN Red List species do occur on and in the vicinity of most of Gem Diamonds operations.One suchspecies is the chimpanzee that occurs at the Mambr site in CAR.Gem Diamonds rescued a baby

324、femalechimpanzee that was orphaned as a result of the prolific bush meat trade.Staff at the operation have been caring for Claudine,nursing her back to health on a diet recommended by Chimp Eden(part of the Jane Goodall I nstitute).Gem Diamonds Centrafrique has been working with Chimp Eden to obtain

325、 the required CI TES permits to relocateClaudine to a suitable and accredited rehabilitation sanctuary.She is expected to be transferred to a sanctuaryduring the course of 2009,in order to ensure that she can live out her days as part of an integrated family group.key envi ronmental ri sk at Cempaka

326、 and an aspect that i scareful l y studi ed and managed.Water qual i ty management remai ns a l ow ri sk at GemDi amonds other operati ons but adequate managementpl ans are i n pl ace to ensure the preventi on and mi ti gati onof any i mpact on water resources.Hi gh l evel s of waterrecycl i ng have

327、 been achi eved at both the Leteng andEl l endal e mi nes wi th up to 70%of water bei ng recycl ed per annum.Where possi bl e,Gem Di amonds uses bul k power at i tsoperati ons.However,where sui tabl e i nfrastructure does notexi st,di esel generators are used to power staff camps,pl antand equi pmen

328、t.(EN3?)Annual Report 200835I n order to ensure that envi ronmental and soci al i mpactswhi ch occur as a resul t of the Company s operati ons are wel lunderstood,SEI As and appropri ate SEMPs have beencompl eted for al l of the Group s operati ons,except for Chi rii n Angol a,where an assessment i

329、s currentl y underway.(EN12?;SO1?).Rehabi l i tati on programmes have been devel oped for eachoperati on.Extensi ve rehabi l i tati on i s presentl y undertaken atsi tes that have been pl aced on care and mai ntenance.Theseprogrammes have been compi l ed i n such a manner that thesi tes can ei ther

330、be re-opened or fi nal cl osure practi ces beappl i ed wi th ease.Progressi ve rehabi l i tati on of operati onalsi tes i s ongoi ng.Emissions,Effluents and WasteConventi onal waste management practi ces are i mpl ementedat Gem Di amonds operati ons,but due to the remoteness ofsome of the Company s

331、operati ons,the devel opment andi mpl ementati on of i nnovati ve and i mproved waste reducti on,management and di sposal practi ces remai n an area of focus.The Company has set a target for al l operati ons to fi nal i seand i mpl ement appropri atel y i mproved waste managementpl ans duri ng the c

332、ourse of 2009.Research i nto i nnovati ve technol ogi es to reduce ai r emi ssi ons,especi al l y from heavy vehi cl es used i n open pi t operati onshave commenced and tri al s wi l l be undertaken i n 2009 to quanti fy the effecti veness of such products.Shoul d these prove successful,the technol

333、ogy wi l l be rol l ed out to al l operati ons.Envi ronmental pol l uti on i nci dents are acti vel y moni tored atal l operati ons.The most si gni fi cant i nci dents that occurredi n 2008 were the contai ned spi l l age of hydrocarbonsubstances of ci rca 60 l i tres at El l endal e and 21 l i tres atLeteng.Each of these spi l l s was bi o-remedi ated andappropri ate correcti ve acti on was taken