Name and Location
Prestea underground gold project, Ghana.

Client
Golden Star Resources (GSR).

Project Description
Prestea is an underground mine, which has been in existence for more than a century and has historically produced an estimated nine-million ounces of gold.

A feasibility study on the project has demonstrated positive economics for the extraction of the West reef probable mineral reserves at the Prestea project using shrinkage stoping.

There is extensive infrastructure of surface and underground vertical shafts, inclined shafts, horizontal development, raises and stopes developed along the 9 km of strike length of the gold mineralisation at the mine. The primary access shaft for the West reef is the Central shaft, located in the town of Prestea; and the secondary shaft is the Bondaye shaft, 5 km to the south. The Central shaft will be used for personnel access, materials transport, dewatering and hoisting. The

Bondaye shaft will act as the secondary means of egress and for dewatering.

The feasibility study proposes shrinkage stoping, which is the mining method historically used at Prestea, but with the application of rock bolts and timber props to support the stope walls to maintain stope stability and control waste dilution.

The main haulage level will be established on the existing Level 24 to transport mineralised rock and waste rock to the Central shaft for hoisting to surface. An incline/decline system will be developed in the footwall of the mineralisation to access sublevels at a vertical spacing of about 35 m to 40 m between existing
l7 and 24 Levels, and 140 m below Level 24. Shrinkage stopes will be developed between open raises spaced 60 m on strike. Drawcones will be developed out of the sublevels into the stopes and will be equipped with chutes for controlled shrinkage mucking into rail cars in the sublevels.

The stopes will be advanced up dip, with only the swell material (30% of the total blasted) removed from the stopes during the mining phase.When the stope is mined up to the sill pillar below the upper sublevel, the remaining mineralised material in the stope will be drawn as required.

Metallurgical testwork results indicate that the Prestea West reef material is free milling, with about 96% metallurgical recovery using gravity followed by carbon-in-leach (CIL) processing.

The proportion of gravity recoverable gold identified in the testwork is high, at between 50% and 90%.

The processing facility will comprise a 500 t/d standalone plant using a standard comminution circuit, followed by gravity and CIL sections.

The recovered gravity concentrate will be treated in the existing Acacia circuit.

Gold recovered from the CIL circuit will be further processed in the existing elution circuit. DorÈ will be smelted in the existing gold room.

Net Present Value/Internal Rate of Return
The results of the feasibility study indicate a net present value, at a 5% discount rate, of $124-million and a post-tax internal rate of return of 42%, with a payback of 2.9 years from the start of development.

Value
Capital required to commercial production is estimated at $63-million, which includes $20-million in capitalised operating costs.

Duration
The project is expected to be brought into production by early 2017.

Latest Developments
The feasibility study has identified several opportunities. Those include an increase in project mineral resources by further drilling the areas up dip of West reef, above 17 level, and down plunge to the north of the West reef below 24 level; and further drilling that could convert existing inferred mineral resources to the measured or indicated resource category, potentially adding to the mineral reserves and extending the life-of-mine.

The feasibility study is based on all stope rib and sill pillars being left in situ after mining. It is estimated that indicated mineral resources within these pillars totals 287 000 t grading 18 g/t of gold.

Further stope design optimisation and placement of development waste into mining voids could lead to reduced internal and external dilution, and increased mill head grades.

Strong potential also exists to modify the existing processing plant, which could reduce the capital requirement and the construction schedule.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
GSR investor relations, Bruce Higson-Smith, tel +1 416 583 3800 or email investor@gsr.com.