In the media

DRDGOLD to maintain stability with Ergo gold tailings project

[Mineweb] - DRDGOLD SA and Mintails’ joint Ergo Mining venture on the East Rand of Johannesburg will replace lost ounces at DRD’s Crown Mines as it builds up to production of 75,000 ounces annually by the middle of 2009.

JOHANNESBURG - DRDGOLD SA and Mintails’ joint Ergo Mining venture on the East Rand of Johannesburg will replace lost ounces at DRD’s Crown Mines as it builds up to production of 75,000 ounces annually by the middle of 2009.

DRDGOLD chief executive officer Niel Pretorius told Mineweb today that production at the Ergo tailings retreatment operation at Brakpan was an evolution of the Crown Mines strategy and would not add to DRDGOLD’s surface gold production.

Pretorius said surface production from the Ergo tailings operation would eventually replace ounces lost from other areas of Crown Mines that closed down. DRDGOLD SA produced about 45% of its total production from surface.

For DRDGOLD, new surface production at Ergo would assist the company to maintain a balance between often troubled and vulnerable underground operations and less complicated surface operations.

Pretorius said the Ergo tailings operation was part of the company’s strategy to maintain a certain mix of assets comprising more volatile underground mines and surface operations. DRDGOLD has invested capital in surface mines to create consistency and stability as its underground mines were still hardest hit by interventions in the industry.

"The bottom line is that marginal mines are still most affected by safety issues and power cuts. They feel the impact more than the affluent mines do," he said.

Pretorius said efficiencies at DRD’s Blyvoor mine were affected by recent power cuts in South Africa as it had to adapt ventilation here, but DRD operations were currently running at full production with 95% of average power consumption supplied by Eskom.

At Ergo, tailings for re-treatment will initially be pumped from the Benoni Tailings Dam to the Ergo plant at Brakpan at a rate of 600,000 tonnes a month. A further 600,000 tonnes will be drawn from the Elsburg tailings complex from April 2009. This will take the annual tailings retreatment rate from 7.2m tonnes a year to 15m tonnes a year from mid-2009.

Total capital expenditure for this first phase of production is R477m ($59m). The first phase of production will see extraction efficiency of 49.8%, head grades of 0.32g/t and operating cost of R20.39/t ($2.53/t).

Studies are currently under way to determine the viability of refurbishing and re-commissioning the Brakpan plant’s second CIL plant to double the tailings retreatment rate to 30m tonnes a year and to produce uranium and sulphuric acid.

Ergo Mining is operated by Crown Gold Recoveries (Crown) a wholly owned subsidiary of DRDGOLD SA.