Modern Mining January 2020

MINING News

Sibanye-Stillwater ups its stake in DRDGOLD

holding in DRDGOLD, a leading surface mining and processing company, we con- tinue to create value for all stakeholders in line with our vision. We are thrilled that the value of our initial shareholding has already increased by 147 % over 17 months.” The FWGR acquisition increased DRDGOLD’s total mineral reserves at the time by approximately 82 %. Its Phase 1 development, costing R330,7 million, entailed the upgrading of the existing Driefontein 2 plant to retreat 500 000 tonnes per month (tpm) of material reclaimed from the Driefontein 5 tailings dam and of the Driefontein 4 tailings stor- age facility to cater for additional volumes. Phase 1 reached commercial pro- duction on 1 April 2019 and planned throughput of 500 000 tpm during the first quarter of FY2020, within budget and time parameters. Phase 2 has begun with conceptual studies to evaluate options to treat the remaining reserves acquired from Sibanye- Stillwater. One option is to construct a new retreatment plant and tailings storage facility to exploit a larger, regional mineral resource, producing more gold over a lon- ger period and rehabilitating a much larger footprint.  DRDGOLD’s Far West Gold Recoveries DP2 plant near Carletonville (photo: DRDGOLD). interest of 50,96 % in the MFC project. Paul Johnson, CEO of Power Metal Resources, commented: “Progress achieved at the MFC project has been very encour- aging in 2019, with the helicopter airborne electromagnetic work delivering 17 sub- surface conductor targets and the ground geophysics highlighting five key targets for initial drilling. “In recent weeks we have held a number of meetings and discussions with the KKME team and there is clear and growing confi- dence in the potential of the MFC project for a nickel discovery. We are now working with the KKME team on preparations and options for an upcoming drill programme and will provide further updates to the market as material developments occur. “I would like to be clear that exploration drilling of the nature we plan to support is

DRDGOLD, listed on the JSE and NYSE, has announced that its 38 % shareholder, Sibanye Gold Limited, trading as Sibanye- Stillwater, has exercised its option to acquire an additional 12 % interest in DRDGOLD. DRDGOLD acquired the gold assets of Sibanye-Stillwater’s West Rand Tailings Retreatment Project – now known as Far West Gold Recoveries (FWGR) – in July 2018 in return for a 38,1 % stake in DRDGOLD. Sibanye-Stillwater had a 24-month option to acquire an additional 12 %. DRDGOLD CEO Niël Pretorius com- mented: “Sibanye-Stillwater has been our largest shareholder for just over 17 months now and its support has been invaluable in the success of our implementation of the first phase of development of FWGR. “This latest transaction marks the sin- gle largest investment that has ever been made by an individual shareholder in the capital of our company, and it bears testi- mony to a shared vision for the future of our enterprise. “It will come in very handy in accel- erating the further unlocking of value in DRDGOLD’s business and will go a long way to fund the early-stage development of FWGR Phase 2.” Commenting on the exercise of the option, Neal Froneman, CEO of Sibanye- Stillwater, said: “By securing the majority

high risk, albeit the in-depth preparatory work undertaken by KKME helps to mitigate that risk and increase the chance of suc- cess,” Johnson continued. “That said, I also want to be clear why we are enthusiastic and have decided to pro- ceed with the earn-in opportunity. It is rare for investors in the junior resource space to have exposure to near-term drill cam- paigns that could have the potential to yield a large-scale nickel sulphide discovery and we believe that the MFC project is one such opportunity. “If exploration work proves to be success- ful, the potential valuation of the MFC project could rise dramatically and the project could attract considerable interest from larger min- ing companies, as evidenced by the interest already shown to date and by the companies that hold ground in the vicinity of the MFC project.” The MFC project consists of three

Power Metal to earn in on MFC project in Botswana Power Metal Resources (POW), the AIM- listed metals exploration and development company, reports it has provided writ- ten confirmation to Kalahari Key Mineral Exploration Pty Limited (KKME) that it has elected to earn in to a 40 % interest in the Molopo Farms Complex (MFC) project in Botswana, currently 100 % owned by KKME.

To earn in to the 40 % MFC project inter- est, POW must expend US$500 000 on project related expenditure to support drill- ing of key nickel-copper-PGM targets in 2020. This spend requirement is fully cov- ered by POW’s existing cash resources. In addition to the 40 % direct project interest that will be allocated on completion of the earn-in, POW also holds 18,26 % of KKME equity and therefore, upon earn-in completion, will hold an effective economic

4  MODERN MINING  January 2020