CHATREE SUSTAINABILITY

Stakeholders are Vital to Our Business

Chatree Gold Mine is situated in a rural area of Thailand, straddling the border between Phichit and Phetchabun provinces. Though 250 km from Bangkok, there are many nearby villages and substantial rice growing areas. It is, therefore, imperative that we minimise our impact on our neighbours as much as possible and remain a good corporate citizen of our area and of Thailand. We focus on a safe and healthy workplace that has the minimum possible effect on the local area. Through regular meetings and active engagement with the community, we seek to work with our stakeholders for our mutual benefit.

The areas of most concern to our immediate community are water, dust, noise and cyanide.

In a rural agrarian area, maintaining quality water supplies is a central issue. Given the proximity of villages, where many of our employees reside, dust and noise have the potential to be a nuisance to the local way of life. Cyanide, of course, is an issue of concern to all who are involved with mining, from operators to local communities.

Minimising our water use and monitoring quality, including that of stored water, is a continual process. No water leaves the property, all being harvested for our operational needs. Twenty nine surface water quality sampling stations have been developed on the property, together with thirty three groundwater quality testing stations, of which fourteen are in local villages. No results have given cause for concern. Eighty groundwater level measuring stations are in operation on site and near local villages. Water levels rise and fall with the wet and dry seasons but no long term trends have become apparent.

Proper maintenance of roadways, including gravel sheeting, watering, construction of noise bunds and working only in daylight hours in some cases, reduces dust and noise to a minimum. Dust monitoring stations are operating in thirteen surrounding villages. Four of those were added this year to deal with our plant expansion. Quarterly monitoring is undertaken by qualifi ed third parties. With the exception of one location in one sampling period, all results were in compliance with the relevant air quality standards.

Our primary concern is to maintain a safe and healthy workforce. Through the efforts of all our employees and those of our contractors, we have enjoyed another year free of LTI’s, our eighth year in a row. While management can promote safety, only individuals can make it happen through their own actions and through the care of their workmates. Our Thai employees are to be congratulated for their unceasing efforts to maintain a safe workplace. Our zero alcohol policy and regular drug testing also promote our aims in this regard.

Many training courses are offered throughout the year, both in safety and vocational areas. Additionally, during the year we are sponsoring a further six employees as they undertake Bachelor degrees and ten employees studying for a Master’s qualifi cation. At Chatree, we consider that training employees creates an asset rather than incurring a cost.

Kingsgate’s Sustainability Policy

Chatree adheres to Kingsgate’s Sustainability Policy, a copy of which can be found on the website www.kingsgate.com.au.

We are committed to operating our business while respecting the safety, health, social, economic and environmental needs of our stakeholders. We strive to anticipate the needs of future generations in our operating area.

There is no value in espousing these policies unless systems are there to put them into effect. To this end, management systems support the policy and sustainability is an integral part of the agreed duties of all employees and contractors.

Focusing on the Important Issues

In adhering to Kingsgate’s Sustainability Policy, we analyse and review those issues of most importance to our stakeholders and ensure that management effort is directed to those areas of concern. These issues are:

1. water management;
2. cyanide management;
3. workplace safety and training;
4. building local capacity; and
5. continued economic growth for Chatree and Thailand.

They can be represented in a table (opposite)

OUR 2011 ACHIEVEMENTS

For our Employees

• 99% of the Chatree workforce is Thai.
• 81% of the workforce has been sourced from the local area. -39% of management positions are held by women.
• Another year without a LTI, bringing the total to eight years since the last, and only, LTI.
• Received second place in the Best Employer in Thailand 2011
  award, recognizing our performance driven culture, fi rst class people practices and strong organisational alignment.
• Achieving over 90% score for the standards assessed, we were awarded the Thailand National Occupational Safety and Health Award – 2011.

For our Communities

• We have maintained our SA8000 accreditation, fi rst earned in 2007. Chatree is one of the few miners in the world to achieve this Standard.
• 60% of the A$8.9 million mining royalties paid in Thailand go directly to local provinces and village councils.
• A$705,000 was spent in communities during the year, covering areas such as education, infrastructure and health.
• Business development assistance was provided to the Thepnimit mdrinking water factory.
• A 15 seat van was donated to Phichit Red Cross, the third such van we have contributed to that cause.

Environment

• No reportable incidents occurred while 14 minor incidents were recorded.
• Airborne dust levels remained low due in large part to watering and road maintenance.
• A total of A$13.0 million is held in the Environmental Levy Fund. This is fi nanced by an A$1.85 per ounce levy for mine closure and A$3.50 per ounce levy for ongoing environmental remediation.