5. DILUTING MATERIALS

The SAMREC code requires that reported mineral reserves are "inclusive of diluting materials and allow for losses that may occur when the material is mined". Guidelines to the code state that "mineral reserves are reported inclusive of marginally economic material and diluting material delivered for treatment or dispatched from the mine without treatment."

Harmony has adjusted the in situ mineral reserve, which is calculated over an anticipated stoping width, to account for those gold losses and other contributing diluting materials. Diluting or additional materials include sundries (tonnes ascribed to gully cuts, faults and waste), on-reef development tonnes (a wider cut with consequential diluting material), reclamation (tonnes from vamping operations in old mine areas) and shortfall (tonnes not called for by the survey department and ascribed no grade).

Each of these items has been ascribed a value based on current mining experience and has typically been calculated over 12 to 20 month periods. Where recent history has shown unusual or exceptional results, these have been adjusted to reflect more typical mining expectations.