Media releases

Ergo Mining JV breathes new life into East Rand tailings retreatment operation

Details

Published: Tuesday, 18 March 2008 02:00

75 000 ounces of gold a year, 200 jobs

Ergo Mining (Pty) Limited’s current Phase 1 refurbishment of the Ergo tailings retreatment operation at Brakpan, previously owned and operated by AngloGold Ashanti Limited, is targeted to produce 75 000 ounces of gold a year by mid-2009 and provide jobs for 200 people.

Ergo Mining is a joint venture between DRDGOLD South African Operations (Pty) Limited (DRDGOLD SA) and Mintails SA (Pty) Limited (Mintails SA). The former is 74% owned by JSE- and NASDAQ-listed DRDGOLD Limited and 26% by black economic empowerment partner Khumo Gold SPV (Pty) Limited and an employee trust. The latter is a wholly owned subsidiary of ASX-listed Mintails Limited.

Total capital expenditure for Phase 1 is R477 million. Some R62 million has been earmarked primarily for refurbishment of one of the two carbon-in-leach (CIL) circuits at Ergo’s Brakpan plant. It is planned to take the annual tailings retreatment rate from 7.2 million tonnes a year, starting from the fourth quarter of 2008, to 15 million tonnes a year from mid-2009. The average gold head-grade targeted is 0.32 grams per tonne, the extraction efficiency rate 49.8%, and the operating cost, R20.39 per tonne.

Tailings for re-treatment will be drawn initially from the Benoni Tailings Dam at a rate of 600 000 tonnes a month. A further 600 000 tonnes a month will be added later from the Elsburg Tailings Complex, which has an initial measured resource of 171 million tonnes. Retreated tailings will be deposited at first on Ergo’s landmark Brakpan tailings dam and subsequently on the adjacent Withok tailings dam footprint.

While conservative current financial and operating planning anticipates a life of 12 years for Ergo, the company has potential access to 1.7 billion tonnes of gold tailings on the East Rand, containing some 15 million ounces of gold. Treatment of these could extend the operation’s life to 25 years.

Studies currently under way and scheduled for completion later this year will determine the viability both of a second phase of refurbishment of the Brakpan plant to re-commission the second CIL plant, doubling the retreatment rate to 30 million tonnes a year, as well as uranium and sulphuric acid production.

Ergo Mining will be operated by Crown Gold Recoveries (Pty) Limited (Crown), a wholly owned subsidiary of DRDGOLD SA, and a 25-year veteran of gold tailings retreatment on the central Witwatersrand. Environmental management will be a priority, with particular emphasis placed on land clearance and minimising the impacts of wind-blown dust and ground water pollution. Environmental management programmes (EMPs) are currently being compiled in close co-operation with the relevant government departments.

Queries:

James Duncan
Russell & Associates
+27 11 880-3924