Kumba

KUMBA IRON OREORE RESERVES AND MINERAL RESOURCES 2011

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KUMBA CONTINUOUSLY STRIVES TO DELIVER IN TERMS OF QUALITY, RELIABILITY AND CONSISTENCY:

In line with this ethos, Kumba corporate office as well as site Technical Service Departments have spent a considerable amount of effort on the annual estimation and subsequent reporting of Kumba’s Mineral Resources and Ore Reserves, as is evident when reading the ‘Year-on-Year Reconciliation’ and ‘Reserves and Resources per Operation/Project’ sections in this statement

The environment that we work in, now and in the future, is one of constantly rising costs. This means that profit margins are reduced, hence resource estimates have to be more reliable. Better data is the essential first step to better Ore Reserves and more reliable production planning. (Lewis, 1997).


INTRODUCTION AND SCOPE

This annual estimate of Kumba’s Ore Reserves and Mineral Resources is presented in summary format for a broad overview,
followed by a more detailed description of the site specific Ore Reserves and Mineral Resources of Kumba’s existing operations and growth projects:

This document serves as an indication of Kumba’s Ore Reserve and Mineral Resource status, remaining after the company’s financial year-end as on 31 December 2011. Ore Reserve and Mineral Resource (in addition to Ore Reserves) figures are not an inventory of all mineral occurrences drilled or sampled, but is a realistic record of those, which under assumed and justifiable technical and economic conditions, may be economically extractable at current and in future.

Ore Reserve estimates for the mining operations were updated within two months of the date of this report, whilst Mineral
Resource estimates, reported in addition to Ore Reserves, are estimated according to the latest available geological models which are typically updated six to eight months prior to the end of the year of reporting.

Kumba Iron Ore, as the parent holding company, has access to its iron ore Reserves and Resources through Sishen Iron Ore Company. Estimates, irrespective of whether Kumba’s attributable share in the specific mineral asset is less than 50% or not, are stated in full (100% shareholding). The shares attributable to Sishen Iron Ore Company (SIOC), Kumba Iron Ore (KIO) and Anglo American (AAplc) are summarised in Table 1.

TABLE 1: KUMBA AND ANGLO AMERICAN ATTRIBUTABLE PERCENTAGES FOR MINERAL ASSETS

  % attrib.
to SIOC		 % attrib. to
Kumba Iron Ore		 % attrib.
to Other		 % attrib. to
AA plc via KIO*
Kolomela mine 100 73.9 26.1 48.2
Sishen mine1 100 73.9 26.1 48.2
Thabazimbi mine 100 73.9 26.1 48.2
Phoenix project 100 73.9 26.1 48.2
Zandrivierspoort project 2 50.0 37.0 63.0 24.1

* The holding company Sishen Iron Ore Company (SIOC) is 73.93% owned by Kumba Iron Ore, which in turn is 65.22% owned by AAplc (as at 31 December 2011).
1) On 21 December 2011 judgment was delivered in the High Court regarding the status of the mining rights at Sishen mine. The High Court held that, upon the conversion of SIOC’s old order mining right relating to the Sishen mine properties in 2008, SIOC became the exclusive holder of a converted mining right for iron ore and quartzite in respect of the Sishen mine properties. The High Court held further that as a consequence, any decision taken by the DMR after such conversion in 2008 to accept or grant any further rights to iron ore at the Sishen mine properties was void. Finally, the High Court reviewed and set aside the decision of the Minister of Mineral Resources or her delegate to grant a prospecting right to ICT relating to iron ore as to a 21.4% share in respect of the Sishen mine properties. On 3 February 2012, both the DMR and ICT submitted applications for leave to appeal against the High Court judgment.
2) Zandrivierspoort is a 50:50 Joint Venture between AMSA and SIOC

© 2012 Kumba Iron Ore Limited