Modern Mining October 2016

October 2016 Vol 12 No 10 www.crown.co.za M ODERN MINING

IN THIS ISSUE…  Baobab ships its first phosphate  Liqhobong speeds to completion  Kakula resource estimate completed  Feature – Safety in Mining

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MODERN M I N I N G

CONTENTS

OCTOBER 2016

ARTICLES

REGULARS MINING NEWS 4 Nordgold launches Bouly heap leach operation 5 Joburg Indaba attracts a record turnout 6 Upgraded hydropower plant starts generating power 7 Alternative proposal secures FEED contract 9 Civils contractor kicks off at Yanfolila 10 Baobab ships its first phosphate product 12 MOD announces substantial maiden resource at T3 12 DRA Group appoints Chief Executive Officer 13 Maseve mine accesses key mining block 14 Akwasiso drilling delivers“highly encouraging results” 16 New management at Kimberley Diamonds PRODUCT NEWS 48 Victaulic systems can help mining industry reduce costs 49 Liner expert provides wear solution for chute project 50 DCD, Southwest give muscle to Gravico venture 51 PAT re-invents the slurry pump 53 Lightweight trommel for smaller producers 54 Mill liner optimisation can lower treatment costs 55 Innovative bifurcated chute system for gold project 38 Safety – how good (or bad) are we really? 40 MRS increasingly called on to assist at abandoned mines 41 Award winners unveiled at MineSAFE FEATURE – TRUCKS IN MINING 42 Bell celebrates the E-series evolution 44 Tippers handle tough conditions at Rhino 45 Gravico lightweight bodies for Namibian mine 47 Terex haulers perform for Atlantis Mining COVER 18 Rebuilt Cat 777 trucks more than double their productive lives DIAMONDS 22 Liqhobong speeds to completion COPPER 26 Kamoa/Kakula ranks as Africa’s largest ever copper discovery GOLD 33 Endeavour discovers potential heap leach satellite deposit at Ity FEATURE – SAFETY IN MINING 34 Booyco at the forefront of a crowded PDS market

Editor Arthur Tassell Advertising Manager Bennie Venter e-mail: benniev@crown.co.za Design & Layout

Darryl James Circulation Karen Smith Publisher Karen Grant

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Deputy Publisher Wilhelm du Plessis Printed by: Shumani Mills Communications

The views expressed in this publication are not necessarily those of the editor or the publisher.

Published monthly by: Crown Publications cc P O Box 140, Bedfordview, 2008

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Tel: (+27 11) 622-4770 Fax: (+27 11) 615-6108 e-mail: mining@crown.co.za www.modernminingmagazine.co.za

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Average circulation (April–June 2016) 4306

October 2016  MODERN MINING  1

COMMENT

Mining law – South Africa urged to go back to the drawing board

A lthough our government often congratulates itself on South Af- rica’s mining legislation, which it appears to believe is world beating, not everyone shares this view. Indeed, many industry experts believe that our mining law has serious shortcomings and has actually throttled growth in our min- ing industry. The latest commentator to find fault with the legislation is Dr Anthea Jeffery, who is Head of Policy Research at the South African Institute of Race Relations (IRR). A highly respected author (she has ten books to her credit) and an expert on modern South African politics, she argues in a policy paper – Back to the drawing board on mining law – which has just been published in @Liberty , the IRR’s policy bulletin, that the Mineral and Petroleum Resources Development Act (MPRDA) of 2002 has been deeply flawed from the start. She says the MPRDA is one reason why South Africa’s mining industry shrank by 1 % a year during the global commodities boom from 2001 to 2008 while the mining sectors of other countries expanded by 5 % a year on aver- age over the same period. She also notes that since the advent of the MPRDA South Africa has steadily lost ground as a mining invest- ment destination in the Fraser Institute mining survey – to the point where it is now ranked 66th out of 109 countries, behind most African countries including unstable jurisdictions such as the DRC, Eritrea and Ethiopia. In her paper, Dr Jeffery takes aim in par- ticular at the BEE requirements in the Mining Charter, which she regards as being particularly problematic. As she writes, “The 26 % BEE ownership requirement (which had to be met by 2014) has made it possible in practice for DMR officials to choose the ‘correct’ BEE inves- tors for mining companies to partner with by signalling that an application for a mining right is unlikely to succeed unless a specific BEE partner is brought in.” Dr Jeffery also takes issue with the ‘shifting goalposts’ in respect of BEE targets and recounts how in 2015, at the end of the 10-year charter period, the DMR used revised empowerment rules to claim that only 20 % of mining com- panies had met the BEE ownership obligation. This figure was contested by the Chamber of Mines, which said that all its members had at least 26 % black ownership, with the average black ownership level being 38 %. She adds that the MPRDA’s require- ments regarding social and labour plans have

also generated a host of practical problems. “Applicants must develop plans that are accept- able to DMR officials; and show that they have provided, financially and otherwise, for the implementation of these proposals,” she writes. “In practice, social and labour plans commonly include undertakings by companies to improve living conditions and human capital in mining areas, but the MPRDA provides little guidance as to what they should incorporate. Uncertainty about these requirements has made it easy for DMR officials to approve or disapprove social and labour plans on arbitrary, and often spuri- ous, grounds.” On the subject of nationalisation, Dr Jeffery concedes that it is not a stated policy of the ANC but says the party has “skirted around the issue” and that many of the steps needed to embark on a wider process of mine expropriation or nationalisation “have quietly been taken.” She is in no doubt that nationalisation – or anything resembling it – would be disastrous for South Africa’s mining industry and to prove her point she quotes the examples of Zambia and Chile, countries of almost identical physi- cal size and population. In 1970 both had a copper production in the region of 680 000 t/a. At around this time Zambia nationalised its copper mines while Chile went in the opposite direction, liberalising its mining regime. The results were all too predictable. By 2012 Chile was producing over 5 million t/a of copper while Zambia’s production (though improving as a result of reprivatisation of the mines) was just 675 000 t/a. How to correct the situation? Dr Jeffery’s view is that we need to learn from Botswana which has got much of its mining law right. “Its rules for the granting and cancellation of mining licences are certain, clear, and stable,” she writes. “It does not impose BEE, benefi- ciation, or onerous socio-economic conditions on mining investors. It has not threatened the mining industry with nationalisation or expro- priation, whether direct or indirect. It has avoided corruption and other aspects of the resource curse, and generally used its mining revenues well to promote growth and increase prosperity.” She concludes by saying that South Africa “urgently needs to go back to the drawing board on its mining regime” and that it would be “well advised to follow the example of its Botswana neighbour which offers a sound way to bring its mining law into line with interna- tional best practice.” Arthur Tassell

“In practice, social and labour plans commonly include undertakings by companies to improve living conditions and human capital in mining areas, but the MPRDA provides little guidance as to what they should incorporate.”

October 2016  MODERN MINING  3

MINING News

A recent photo of the Bouly site. The operation is expected to produce 120 000 ounces of gold a year.

Nordgold launches Bouly heap leach operation

mine in July 2015 and invested US$140 million in the project (US$15 million less than initial capex guidance of US$155 million). According to Nordgold, the sig- nificant saving achieved was a result of earthworks being conducted in-house, as well as lower equipment prices combined with disciplined procurement and foreign exchange gains. In line with Nordgold’s development strategy, the project had been de-risked

prior to final board approval. According to the Feasibility Study, the IRR for Bouly is approximately 40 % at a gold price of US$1 250 per oz and approximately 26 % at a gold price of US$1 100 per oz. The payback period is expected to be 30 months at a gold price of US$1 250 per oz and 42 months at a gold price of US$1 100 per oz. Bouly is the company’s third operating asset in Burkina Faso and the second project Nordgold has developed from a greenfield stage in the country in the last six years. The launch of Bouly confirms Nordgold’s posi- tion as the second largest gold producer in the country, with total production of approximately 400 koz per year. “Bouly is another outstanding addi- tion to our global asset portfolio and once again highlights our ability to execute large mining projects on time and, in this case, under budget,” comments Nikolai Zelenski, Nordgold’s CEO. “Like Bissa, which we launched in 2013, Bouly is a best-in-class operation, which will not only increase overall production and efficiency at Nordgold, but will be another major economic contributor to our host country and its local community.” Approximately 1 000 jobs were created during the construction phase and 350 permanent jobs will be created over the mine’s 10-year life span. Direct benefits to the state will come mainly in terms of income tax and royalties, which are esti- mated to be US$120 million over the life of

LSE-listed Nordgold has announced that it has expanded its flagship Bissa mine in Burkina Faso with the launch of a heap leach operation at the nearby Bouly deposit. Bouly’s average annual produc- tion will be approximately 120 koz over a LOM of 10 years. In 2016, Bouly is expected to produce up to 20 000 ounces of gold. Bouly was completed in August this year on schedule and under budget. Nordgold started construction of the

The first Bouly gold pour (photo: Arnand van Heerden).

4  MODERN MINING  October 2016

MINING News

were well received, earning him a sus- tained standing ovation from the majority of delegates. At a gala dinner on the eve of the Joburg Indaba, South Africa’s very own Mining Hall of Fame was launched, bring- ing the country into line with other major mining jurisdictions such as Canada, the US and Australia which have had their own mining halls of fame for over two decades. The first inductees – announced by Bernard Swanepoel, Chairman of the Joburg Indaba – are Bobby Godsell, Patrice Motsepe, Sipho Nkosi, Gwede Mantashe, May Hermanus, Phumzile Mlambo- Ngcuka, Brian Gilbertson, Mark Bristow and Barry Davison.  Bissa mine on the border of the rural com- munes of Sabce and Mane, 100 km north of the capital, Ouagadougou. Operated by Bissa’s management team, Bouly is a single open-pit operation.The ore is crushed with primary jaw and secondary cone crushers, followed by agglomeration before stacking on an HDPE-lined pad – designed by Knight Piesold Australia – for irrigation with a sodium cyanide leach solution. Bouly utilises mining equipment and jaw crushers similar to those in place at Bissa to standardise stock holding and optimise maintenance costs. According to Nordgold, Bouly will ben- efit from low cost mining operations due to an excellent average LOM stripping ratio of 0,7 t/t and straightforward heap leach metallurgy with superior gold recovery at 83 %. The mine has its own all-season heap leach facilities with final processing stages, including desorption, electro-winning and smelting, taking place at the Bissa process- ing plant. 

low-grade gold deposit hosting mineral resources of 3,5 Moz at 0,57 g/t and ore reserves of 1,3 Moz at 0,56 g/t. It is located within 5 km of Nordgold’s

the mine, excluding state revenue derived from fuel tax. Bouly is the result of a successful explo- ration programme which identified a large,

Joburg Indaba attracts record turnout A scene from the recent Joburg Indaba, held at the Inanda Club in Johannesburg on 5/6 October. The event, now in its fourth year and increasingly popular, attracted a record turnout of around 550 delegates. Our photo here shows industry experts discussing ‘Innovation and new technolo- gies in mining: Mine of the future.’ Pictured (from left) are Andrew Lane of Deloitte, who chaired the session; Peter Turner, Senior VP, Health, Safety & Environment, Sibanye Gold; Bongi Ntsoelengoe, Technology Manager, Kumba Iron Ore; Fred Cawood, Director, Wits Mining Institute (WMI), Faculty of Engineering and the Built Environment,

University of the Witwatersrand; and Sietse van der Woude, Senior Executive, Modernisation & Safety, Chamber of Mines of South Africa. Among the many highlights of the Joburg Indaba was – as most readers will already know – a courageous address by AngloGold Ashanti Non-Executive Chairman Sipho Pityana, who said that cor- ruption was “spreading like an ugly oil slick across our society”. He blamed the ANC government and, in particular, President Jacob Zuma for this state of affairs and said “our young democracy is facing its sternest test yet on a number of fronts.” His views

October 2016  MODERN MINING  5

MINING News

The Mwadingusha dam on the Lufira River. The hydropower plant at Mwadingusha has begun supplying an initial 11 MW of power (photo: Ivanhoe).

Upgraded hydropower plant starts generating power national grid. The upgrading work is being undertaken by a partnership between SNEL and Ivanhoe Mines Energy DRC, a subsidiary of Kamoa Holding Limited.

Ivanhoe Mines’Executive Chairman, Robert Friedland, and the company’s CEO, Lars-Eric Johansson, have announced that ongoing upgrading work financed by the company at the Mwadingusha hydropower plant has begun supplying an initial 11 MW of power to the national grid in the DRC. Ivanhoe is developing the Kamoa cop- per project (see also page 26) near Kolwezi in the DRC which will ultimately be a sig- nificant user of electricity. The upgrading – part of a programme planned to eventually overhaul and boost output from a total of three hydropower plants – is being conducted by Ivanhoe Mines and its joint-venture partner, Zijin Mining Group, in conjunction with the DRC’s state-owned power company, La Société Nationale d’Electricité (SNEL). At Mwadingusha, electricity is now being produced by the No 1 turbine gen- erator, the first of six installed at the dam’s power plant that are being upgraded and modernised. It is the first step in a programme based on an initial 2011 memorandum of understanding, and subsequent 2014 agreement, between Ivanhoe and SNEL. The Mwadingusha plant was originally commissioned in 1930. Completion of the full upgrading and modernisation of Mwadingusha’s five other generating units that is now underway is expected to restore Mwadingusha to its installed output capac- ity of approximately 71MWof power for the

Nzilo 1 – is expected to begin once upgrad- ing work at Mwadingusha is completed. The Mwadingusha and Koni plants are in cascade, with Koni directly down- stream from Mwadingusha on the Lufira River at the mouth of Lake Tshangalele, north of Likasi and approximately 250 km north-east of Kamoa. The Nzilo 1 plant, commissioned in 1952, is on the Lualaba River, downstream of Nzilo Lake and north of the city of Kolwezi, approximately 40 km from the Kamoa mine development site. The three plants, once fully recondi- tioned, could produce a combined 200MW of long-term electricity for the grid, which is expected to be more than sufficient to launch copper production at Kamoa. Construction of a 20 km long, 120 kV transmission line to supply construction power to the Kamoa site from the Kolwezi- Kisenge line, where it crosses the northern boundary of the Kamoa mining licence, was completed in late August. In addition, a local company is constructing 8 kmof 11 kV overhead power lines, cabling reticulation and five mini-substations for distribut- ing 11 kV of electricity to the Kamoa mine development declines at Kansoko Sud, camps, offices and de-watering boreholes. Power from the national grid is expected to be available to the Kamoa site this month (October) after the final test- ing and commissioning of the 120 kV and 11 kV overhead powerlines and electrical substations at Kamoa. 

A ceremony recently marking the resumption of output from the first gen- erator was attended by prominent officials, including the Governor of Haut-Katanga Province, Jean-Claude Kazembe Musonda; Haut-Katanga’s Minister of Mines, Professor Willy Kitobo Samsoni; and members of the senior managements of SNEL and Ivanhoe Mines. Friedland said a dependable power supply was essential to planned produc- tion at the Kamoa copper project. “This first installation of modern power gener- ating equipment at Mwadingusha is an important milestone in helping to secure long-term, sustainable and clean electric- ity for the Congolese people and for the development of our major new copper mine at Kamoa. “Mining and the supply of reliable energy are inseparable and we are com- mitted to implementing energy-efficiency measures and supporting cost-effec- tive ways of generating clean energy. Hydropower, with the virtues of being clean and renewable, is among the best energy solutions for our industry liv- ing with the realities of climate change,” Friedland added. Upgrading of the other two existing hydroelectric power plants – Koni and

6  MODERN MINING  October 2016

MINING News

Alternative proposal secures concentrator FEED contract

WorleyParsons RSA credits an alternative proposal based on technology-driven design work and a one-team approach for successfully securing the Front End Engineering Design (FEED) contract for Royal Bafokeng Platinum’s second phase 100 kt/month Merensky concentrator at its BRPM (Bafokeng Rasimone PlatinumMine) operation. The first phase of the expansion, which is nearing completion, will increase the concentrator’s capacity to 250 000 tonnes a month from 200 000 tonnes a month. The second phase will update the concen- trator’s capacity at the BRPM concentrator complex to 350 000 tonnes a month to accommodate Merensky ore production from BRPM’s new Styldrift mine. “As this is a brownfield project in some areas, we had to take into consideration that we would need to work very closely with the existing operations and develop an engaged working relationship with the customer’s team,” says Ian Hendry, Workshare Manager, WorleyParsons RSA. “Our two-fold approach incorporating our in-house developed integrated design platform and a one-team strategy between ourselves and the customer played a major role in successfully winning the bid.” WorleyParsons’ integrated project plat- form combines sound engineering skills with computer gaming technology to produce high level 3-dimensional design models of a project coupled with cost and schedule to produce a real time 5-Dmodel. “We developed a 3-dimensional walk-through visual presentation of the proposed plant from existing 2-dimen- sional drawings produced by others as part of their feasibility study. By using 3-D virtual reality goggles in combination with Google Earth, the customer could walk through the proposed design of the process plant and easily identify areas for improvement in the current design that will have a material bearing on cost and schedule,” says Hendry. The 5-D model includes precise cost and schedule data using WorleyParsons’ integrated project platform that gener- ates a plant breakdown structure. This in turn interfaces with the Work Breakdown Structure, providing numerical values for the project, connecting every single component to an item on the schedule

Integrated technology drawing produced by WorleyParsons.

to ensure clear, efficient lines of commu- nication and ultimately successful and timeous project delivery. This is the second project for Worley­ Parsons at the BRPM concentrator as the project delivery company was previously contracted to provide detailed design, procurement, construction management, commissioning and project management for the Styldrift Merensky Phase 1 mine project.  Operational Excellence appointment by Advisian Advisian, the independent advisory busi- ness line of WorleyParsons, has appointed Steve Burks as its principal of Operational Excellence for the Sub-Saharan Africa region. Burks has over 30 years of experience in the environment of processing plants and mines, mostly gained working in the mining industry both in production and projects. He has recently marketed and worked on strategic optimisation, tactical business improvement, strategy development and operational readiness studies, interacting with executives but also with professionals and front line supervisors with direct respon- sibility for operational or project activities. Recently an Associate Director of MAC Consulting and, prior to this, MD of Whittle Consulting (Africa), Burks has worked exten- sively in providing value chain optimisation services to the mining industry. His profes- sional career further includes the role of CTO (Chief Technology Officer) of Bateman Engineering NV. 

from a time and cost perspective. Murray Macnab, Director for Mining and Mine Business Development for WorleyParsons, believes that this inte- grated project platform is the most advanced project management tool cur- rently available in the Southern African market and that it is setting the benchmark in delivering engineering projects. Macnab adds that brownfield projects often carry the risk of inaccurate existing 2-dimensional drawings that do not reflect topography and terrain in reality, posing time and cost implications to investors at a later stage. However, with the integrated design platform, these imprecisions are eliminated as the 3-D survey produces measurements capable of achieving accuracy within 4 mm, while aerial views providing exact elevations are incorpo- rated in the 3-D design model and viewed in virtual reality to enhance clash detection. “Our focus is on utilising technology to drive a better design in order to easily identify challenges and realise solutions prior to commencement of construction. Our integrated project platform provides for greater accuracy and efficiency, making project delivery within budget achievable and greatly reducing the risk of downtime,” says Macnab. Henry Jonker, General Manager, Mining Minerals and Chemicals for WorleyParsons RSA, adds that while the integrated 5-D model played a major role in WorleyParsons being awarded the con- tract, overall the customer was also very impressed with their one-team approach

October 2016  MODERN MINING  7

MINING News

Civils contractor kicks off at Yanfolila plant experience throughout Africa.

construction has now commenced, and we are on schedule for our first gold pour by the end of 2017 targeting 132 000 oz in the first year.” Hummingbird is developingYanfolila as a low cost, multi-pit mining operation with ore treatment via a simple gravity and CIL processing route. The processing plant will have a capacity of 1,24 Mt/a. 

AIM-listed Hummingbird Resources has announced that following the recent appointment of contractor IMAGRI-SARL, civil works have now commenced at the company’s Yanfolila gold project in Mali. According to Hummingbird, IMAGRI is an established specialist in the con- struction of world class mines in Mali. It was instrumental in the construction and expansion of Randgold Resources’flagship Loulo underground mine power plant and the associated Gounkoto open-pit mine. IMAGRI’s experience also includes work at Robex Resources’ Nampala gold mine (as general contractor), Toguna Agro-Industries’ phosphate mine, the Elephant Vert’s fertiliser plant, as well as a portion of ASX-listed Resolute Mining’s Syama mine. In July this year Hummingbird awarded the Engineering, Procurement and Con­ struction Management (EPCM) contract for Yanfolila to SENET (Pty) Ltd, a leading South African project management and engineering company with extensive gold

“We are now laying the ground work for our first gold mine in Mali with civil works having started,” comments Dan Betts, CEO of Hummingbird Resources. “ This is an important milestone for Hummingbird Resources as full scale mine

The start of civil works at the Yanfolila site (photo: Hummingbird).

EPCM contract for antimony roaster in Oman awarded Strategic Precious Metals Processing (SPMP) has contracted WorleyParsons Oman Engineering, with support from WorleyParsons RSA, to execute the engi- neering, procurement and construction management (EPCM) for the world’s first major antimony roaster outside of China in decades, designed to modern environ- mental standards. The plant location is ideal for the trading facilities available to SPMP. The OAR project will be a commer- cial plant where the feed to the plant will originate from across the globe. The plant involves a roasting, gas treatment and smelting process. The main product streams of the processing plant include high grade antimony ingots, powdered antimony trioxide, gypsum and gold doré. WorleyParsons RSA will execute the The Oman Antimony Roaster (OAR) will be constructed in Sohar, located within the Free Port Zone of the Sultanate of Oman.

engineering and procurement scope from South Africa in conjunction with WorleyParsons in Australia (Adelaide and Perth). The WorleyParsons Oman Engineering team, which played a key role in pursuing this strategic customer and which provided support and advice to the customer throughout the discus- sions leading to the award, will be fulfilling the construction management scope with strong support from both WorleyParsons RSA and Australia. 

October 2016  MODERN MINING  9

MINING News

Baobab ships its first phosphate product Open-pit mining at the Baobab phosphate project (photo: Avenira).

A mining contract was signed with a Senegalese contractor, Agromines, in December 2015. The contract was struc- tured to allow continuation of mining after the Stage 1 open pit, allowing opera- tions to be continuous once pre-stripping commenced. Mobilisation of the mining fleet to the Baobab site was undertaken through January and February 2016, with pre-strip- ping commencing for the Stage 1 open pit in March. The first phosphate horizon was uncovered in July 2016 and the first phos- phate was mined at the end of August. Mining of the phosphate mineralisation demonstrated that efficient grade control can be achieved visually during daylight hours, with the mining geology team trained to supervise phosphate mining. Design and engineering for the pro- cessing facility was developed with South

ASX-listed Avenira Limited reports it has achieved another important milestone at its 80 %-owned Baobab phosphate project in Senegal with the first trucking of phos- phate product to the stockpile at the Port of Dakar. Avenira’s strategy to develop the proj- ect is based on an initial, US$15 million, Stage 1 operation producing 500 000 tonnes per annum of phosphate product, with later stages allowing for production expansion. Maiden shipping of product is currently planned for the fourth calendar quarter of 2016. Avenira’s Managing Director, Cliff Lawrenson, commented: ‘‘The Baobab phosphate project continues to progress steadily and it is excellent to see the first trucking of phosphate product to the

stockpile at the Port of Dakar, some 145 km from the mine site. The project is nowmov- ing into operational stage with appropriate procedures and protocols in place. “As expected, the annual wet sea- son slowed processing and drying of the phosphate product and initial trucking operations. However, wet conditions are now easing allowing for more routine operations with first shipping our priority. We thank the whole Avenira team for their commitment in reaching this important milestone.” Baobab employs straightforward open- pit mining to access the mineralisation through the unconsolidated sand over- burden. The processing plant is similarly effective, employing a simple wet-screen- ing process to beneficiate to final product.

The product drying area at Baobab (photo: Avenira).

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MINING News

Africa’s Consulmet. This initial plant com- prises a contract screening and crushing plant and an ‘ultrafine’ wet screening plant. Future modular processes for owner crushing and magnetic separation can be readily added to the existing plant design. Following the execution of the Consulmet contract in January 2016, fabrication of the equipment was under- taken in Johannesburg from January to May 2016 and then pre-erected to ensure minimal delays upon site installation. Consulmet construction teams mobilised to site in May and completed construc- tion during July with wet commissioning completed at the end of July 2016. First phosphate product was stockpiled at the end of August 2016. Avenira has been involved with Baobab, in conjunction with Agrifos, since 2014. Agrifos originally launched the project in 2011. A Small Mine Permit (SMP) was granted in May 2015 and Avenira subse- quently acquired 100 % of the asset from Agrifos in September 2015. 

Stefanutti Stocks selected for Boikarabelo ASX- and JSE-listed emerging coal pro- ducer Resource Generation (Resgen) says that significant progress has been made towards securing final approval for the development of the company’s major proj- ect, the Boikarabelo coal mine in South Africa’s Waterberg coal field.

appointment is another important step towards validating the Base Case Financial Model and the financial close of our debt funding arrangements. This brings us one step closer towards the development of the Boikarabelo mine.” Updating on the funding of the proj- ect, Resgen says it advised the market on 8 August 2016 that it had agreed commer- cial terms with a Financing Syndicate for the development of Boikarabelo subject to a number of Conditions Precedent. The Financing Syndicate convened a series of due diligence presentations and a visit to the Boikarabelo mine during the week of 29 August 2016. The outcome of the presentations and site visit were satisfactory and no serious flaws were iden- tified, says Resgen. Ledjadja Coal has reported probable reserves of 744,8 Mt of coal on 35 % of the tenements under its control. Stage 1 of the mine development targets saleable coal production of 6 Mt/a. 

Rob Lowe, Chief Executive Officer of Resgen and its BEE operating subsid- iary, Ledjadja Coal, said the company was advancing in parallel a number of inter-related agreements which together provide for long term risk management and financial confidence in the mine development. In a key step forward, Ledjadja Coal has selected Stefanutti Stocks Mining Services (SSMS) as the preferred mining contractor. Commented Lowe: “The appointment is in line with our execution strategy to appoint contractors with good track records and strong balance sheets and thereby reduce the company’s exposure to operating risks inherent in a self-operated mine. This

October 2016  MODERN MINING  11

MINING News

MOD announces substantial maiden resource at T3

ASX-listed MOD Resources has com- pleted a substantial maiden copper/silver resource at its T3 deposit within six months of discovery. T3 forms part of a joint ven- ture between MOD Resources (70 %) and AIM-listed Metal Tiger (30 %) in the

Kalahari Copperbelt of Botswana. Combined indicated and inferred resources using a 0,5 % Cu cut-off consist of 28,36 Mt at 1,24 % Cu and 15,7 g/t Ag, containing approximately 350 200 tonnes Cu (772 Mlb copper) and 14,27 Moz Ag. This includes a high-grade resource using a 1,5 % Cu cut-off grade which consists of 8,48 Mt at 2,16 % Cu and 30,6 g/t Ag, con- taining approximately 182 900 tonnes Cu and 8,34 Moz Ag. Importantly, 64 % of the total resource tonnes are in the indicated resource category demonstrating the excellent continuity of the mineralisation drilled on a 100 m by 100 m grid pattern. MOD Resources’ Managing Director, Julian Hanna, said the maiden resource represented a tremendous milestone for the joint venture and a major step towards MOD’s objective of becoming a long-life, copper producer in Botswana. “To be able to report 350 000 tonnes of contained copper and more than 14 mil- lion ounces of silver in the first resource from a new discovery in a relatively unex- plored region is a great achievement for the whole team,” said Hanna. “The unusual geometry of the T3 deposit with wide and continuous zones

of shallow dipping mineralisation provides the opportunity for potential low cost open-pit mining. An additional bonus is the large amount of silver (>14 Moz) which is expected to be able to be recovered into the copper concentrate, assuming the project goes into commercial production. “Success at T3 has been achieved in a short time frame and to a very high stan- dard – a credit to all the people on-site, including our many Botswana employees and contractors who have worked hard to achieve this excellent result,” Hanna said MOD’s open-pit scoping study is pro- gressing well with a separate, highly experienced team to manage all facets of the process. Drilling is currently testing for potential extensions to high-grade veins north-east of the resource and targeting an IP target approximately 500 m down dip from the resource. Exploration will also step out along the T3 Dome and surrounding areas to test potential for other deposits of this type. The copper and silver mineralisation which is the basis for the T3 Phase One mineral resource is interpreted by MOD to be a Proterozoic or early Palaeozoic age, vein-related sediment-hosted deposit which is different to other known depos- its and mines in the central Kalahari Copperbelt in Botswana. The mineral resource has been defined along a 1,4 km long strike length at T3 and the copper and silver sulphide mineralisa- tion occurs in veins and disseminations within mudstone, siltstone, sandstone and marls as host rocks. The resource occurs in sediments and veins considered part of the D’Kar Formation. The footwall to the resource is generally defined by lower grade disseminated Pb and Zn mineralisa- tion within the host rocks, still considered part of the D’Kar Formation. Mineralisation is very continuous at the T3 deposit and is dominated by mainly chalcopyrite with chalcocite and bornite copper sulphides occurring in lesser amounts. Mineralisation extends from shallow depth (approximately 35 m depth) to the limit of drilling at approxi- mately 274 m depth. Minor malachite and chrysocolla oxide mineralisation occurs near surface between approximately 10 and 25 m depth. 

A drill site at the T3 deposit (photo: Nick O’Reilly, QP for Metal Tiger).

DRA Group appoints Chief Executive Officer DRA Group Holdings has announced the appoint- ment of Wray Carvelas (left) as CEO, with imme- diate effect. Tim Netscher, Carvelas replaces Andrew Naudé who acted as interim CEO from May 2016, in addition to his role as Chief Financial Officer and Strategy Director. Wray also embodies DRA’s values with his unwavering conviction and commitment,” Netscher says.

Chairman of DRA, s a y s t h a t t h e DRA board went

“We thank Andrew for his excellent leadership over the last few months,” says Netscher. “Together with the Global Executive Committee, he has ensured that our organisation continued to move for- ward both strategically and operationally.” Naudé will continue to work with Carvelas and the DRA Group Executive Committee in the next few months to ensure a smooth transition. Carvelas assumed the role as Group CEO on 1 October 2016 and he will officially be appointed to the DRA Board in November 2016. He will be embarking on a global roadshow over the coming weeks to for- mally introduce himself to DRA’s teams and clients in all regions. 

through an extensive recruitment process interviewing high calibre internal and external candidates. “Wray was the outstanding candidate for the role,” says Netscher. “This is evident in his considerable experience in both busi- ness and engineering, with a strong track record of success throughout his career.” Carvelas has been with DRA for 15 years, having joined the company in 2001. He pre- viously held the role of Projects Director and was appointed as CEO of DRA’s Americas operations in 2011. He holds an MBA cum laude from the University of Stellenbosch. “In addition to his impressive career,

12  MODERN MINING  October 2016

MINING News

Maseve mine accesses key mining block

Block 11 is planned to be installed, which will greatly improve the ability to move good grade tonnes out of the mine. Monthly production at Maseve is increasing. During the month of August, the mine produced 1 893 ounces 4E. Production is expected to double in September, 2016 from August levels and then continue to increase monthly into 2017, says Platinum Group. Guidance for concentrate production for the Maseve mine (100 % project basis) from April 2016 to April 2017 has been amended from 110 000 4E to 91 500 ounces 4E. 

duction from September 2016 into 2017. Direct Platinum Group Metals over- sight of the underground contractors has been increased in the past 60 days. Underground equipment maintenance management has been changed and equipment availability is improving. A conveyor from underground has been commissioned that feeds directly to the overland conveyor and into the primary crusher and mill. In the months ahead, a final conveyor leg directly to

In an update on its South African operations, Platinum Group Metals, listed on the TSX and NYSE MKT, reports that primary development at its newMaseve mine accessed mining Block 11 in mid-August. Block 11 hosts some of the best grade thick- ness ore at Maseve and is an important part of the next several years of scheduled mining. Seam thickness where accessed is approxi- mately 2,0 m, with a well-developed and near flat dipping Merensky Reef present as mod- elled. Vertical channel sampling has returned assays of 7,4 g/t platinum, palladium, rhodium and gold (4E) over a true width of 193 cm. This block is amenable to room and pillar stoping utilising efficient mechanisedminingmethods. “Access to Block 11 has been a primary objective for the last two years,” comments R. Michael Jones, Platinum Group’s CEO. “We are very pleased to find the reef in this area as good as or better than expected. We are currently driving primary access along Block 11. Breakaway drives for mining are also in process. We are excited to mine the excellent tonnes and grade available in Block 11 as we continue to drive for volume.” Block 11 is a large, well-drilled and stable mining block estimated to host more than 545 000 4E Merensky Reef ounces (3,06 Mt at 5,53 g/t 4E indicated). The Maseve mine is fully constructed and is in the ramp up phase of production. Development has established approximately 20 ends where the Merensky Reef is exposed and of these 18 are currently working ends. Recent efforts have been focused on primary access development. Active stoping areas are increasing as development and set up is com- pleted on Merensky Reef ends. Recoveries and performance of the mill have been at or above design criteria and the plant can handle throughput in excess of the nameplate 110 000 tonnes per month utilising the current MF1 circuit. According to Platinum Group, production challenges have related to the ramp up of stoping tonnes. Project construction savings have offset some but not all of the costs result- ing from the delay. Difficulties and delays have been experienced in certain areas of under- ground infrastructure, causing bottlenecks in the movement of waste and ore out of the mine. Completion of the first underground silo top, the addition of a belt loader at this silo and future top and bottom completions at silos two and three are expected to increase pro-

October 2016  MODERN MINING  13

MINING News

Asanko Gold Inc, listed on the TSX and NYSE MKT, has announced highly encour- aging results from the new exploration target, Akwasiso, which is located approxi- mately 4 km from the processing facility at the Asanko Gold Mine (AGM) in Ghana. The drilling programme at Akwasiso Akwasiso drilling delivers “highly encouraging results” forms part of the company’s near-mine exploration strategy to source additional ore resources that will utilise the excess capacity in the processing plant during 2017 and 2018 until Phase 2A is built and commissioned. Akwasiso lies on the Nkran shear cor-

ridor which hosts the AGM’s main pit, Nkran, as well as the Nkran Extension and Dynamite Hill satellite deposits. A 10 000 m drilling programme has been undertaken to validate the geology and grade continuity of at-surface mineralised oxide zones defined by a previous opera- tor. In addition to confirming this historical work, significant mineralisation has now been discovered below and on the west- ern flank of the previous drilling. “We are very excited about the poten- tial of Akwasiso, which is displaying similar geological features and mineralisation to the Nkran deposit, our main resource,”com- ments Peter Breese, President and CEO of Asanko Gold. “The first set of results shows the potential to be even more significant than previous near-mine discoveries at the Adubiaso and Nkran Extensions. With the mineralisation still open at depth and along strike, we will plan to initiate a further drilling campaign and prepare a maiden mineral resource estimate.” 

The Nkran pit in September this year. Akwasiso is displaying similar geological features and mineralisa- tion to the Nkran deposit (photo: Asanko Gold).

14  MODERN MINING  October 2016

MINING News

Yaramoko gold mine achieves commercial production Roxgold Inc, listed on the TSXVenture Exchange, reports that commer- cial production at the Yaramoko gold mine in Burkina Faso has been achieved, effective October 1, 2016. “We are pleased to have reached yet another significant mile- stone at Yaramoko and look forward to continuing our track record of meeting expectations and to a bright future. Total gold production at Yaramoko reached 47 469 ounces at an average mill feed grade of 15,6 grams per tonne as of September 30, 2016,” commented John Dorward, Roxgold’s President and CEO. “Bringing Yaramoko into pro- duction ahead of schedule and under budget is an achievement we can all be proud of, and I want to thank Roxgold’s employees and con- tractors for their continuing hard work and dedication.” From July 1, 2016 to September 30, 2016, Yaramoko produced 32 987 ounces of gold. During the same period, 34 594 ounces were sold at an average realised price of US$1 334 per ounce. The second stope (MD_5219-53) was extracted successfully in September 2016. This double height stope remained stable and dilu- tion, at 17,9 %, was below the Feasibility Study assumption of 20,5 %. The first stope (MD_5219-38) has been filled with cemented rock fill in preparation for the extraction of the adjoining stope. Roxgold says it is encouraged by the efficiency with which stoping operations have been established at Yaramoko.  Mineralisation occurs in three zones identified to date: theWestern shear zone, a Central sandstone and granite contact zone, and an Eastern granite contact zone. Further drilling is planned which will test all three zones and mineralisation is still open at depth and along strike.  Moabsvelden granted water licence Keaton Energy reports that its Moabsvelden project has been granted an Integrated Water Use Licence by the Department of Water and Sanitation. The project is now fully permitted, having already been awarded its Mining Right and environ- mental authorisation in terms of the National Environmental Management Act. Moabsvelden is adjacent to Keaton’s existing successful, long-lifeVanggatfontein colliery andwill benefit from shared infra- structure and reduced operating costs. It is envisaged that some 4 Mt/year of coal will be produced from the combined operation. “We are pleased that the Integrated Water Use Licence has been awarded,”said Mandi Glad, Keaton’s CEO.“We can now final- ise offtake negotiations with the various parties who expressed an interest in purchasing coal fromMoabsvelden. This in turn will allow the washing plant configuration to be finalised and funding for the development to be closed.”  The Akwasiso target is situated immediately north-east of the Nkran Extension deposit and the Tailings Storage Facility. The target sits on the company’s existing Abriem mining lease, but until recently had been designated as ‘small mining concessions’ and owned by small scale alluvial miners. Asanko Gold acquired the concessions, which had been previously explored by a prior operator, earlier this year. 

October 2016  MODERN MINING  15

MINING News

New management at Kimberley Diamonds

ASX-listed Kimberley Diamonds Ltd (KDL), which operates the newly recommissioned Lerala diamond mine in Botswana, has announced that Noel Halgreen, previously Managing Director of KDL, has resigned from the board and will be leaving KDL in six months after serving out his notice period as a consultant. Alex Alexander becomes Executive Chairman during the transition stage, while KDL searches for a new MD. Brett Thompson, KDL’s current Chief Technical Officer, has been appointed to the newly created role of Chief Operating Officer, and will be responsible for all min-

ing, operations and corporate functions of the company and its Botswana subsidiary, Lerala Diamond Mines Limited. Thompson is a mining engineer with over 30 years of operational, technical and corporate management experience in Africa, South America and Australia with 15 years in the diamond industry and sig- nificant experience in coal, gold/silver and base metals operations. Prior to joining KDL in March 2015, Thompson worked for five years with Anglo American. Before this, he was the CEO of AIM-listed diamond company, Pangea DiamondFields, and has held

senior positions with a number of other diamond juniors operating in Africa. He began his mining career as a gradu- ate engineer at Mount Isa Mines before moving to De Beers in South Africa in 1988 where he gained experience at Koffiefontein Mine and the Namaqualand Mines alongside a later stint as Assistant General Manager at De Beers' Kimberley Mines. The management changes come at a time when Lerala is struggling with its ramp up. In its latest presentation on the project, KDL reports that average daily head feed has steadily increased over the

ramp-up phase and the plant has proven capable of operating at and above its designed capacity of 200 t/h. KDL nevertheless notes that “operating the recom- missioned plant for three months has revealed shortcomings in some pre- existing elements of the plant. This, combined with the highly abrasive char- acter of the internal waste within the kimberlite ore, has significantly impacted the plant’s ability to oper- ate at maximum capacity on a consistent basis.” KDL says it is hoping to address these issues over the next four months and estimates the cost of remedial measures at A$1,57 million. 

The process plant at the Lerala diamond mine in Botswana. The plant was recommissioned earlier this after a major upgrade (photo: KDL).

Finance facility for Kabwe tailings project secured AIM-listed BMR Group, which is focused on the recovery of lead and zinc from the tailings deposits of Zambia’s oldest mine at Kabwe, says that – in conjunction with its subsidiary Enviro Mining Limited (EML) – it has now entered into the anticipated project construction and trade finance facility for up to US$5,2 million with African Compass International Limited (ACI). The lat- ter is a private South African group engaged in mining, energy and agri-business.

Alex Borrelli, Chairman of BMR, com- mented: “This facility represents a defining moment for the company as the financing has underpinned our planned cost of the plant at Kabwe. We are pleased to have delivered this facility for the benefit of our shareholders who have supported the management team in our endeavours for processing the Kabwe tailings. The facility also provides us with the funding necessary for exercising the option agreement on the Star Zinc licence. Our continuing progress on our schedule of works at Kabwe remains in line for completing the plant construc- tion for commissioning in 2017.” 

various milestones – through to commis- sioning of the Kabwe plant and proof of saleable product – up to US$4,2 million for use in connection with the plant, andmate- rials processed, at Kabwe. In addition, the facility provides for the drawdown of US$1,0 million to sat- isfy the consideration payable to exercise the option agreement with Bushbuck Resources Limited for the acquisition of its Star Zinc Large Scale Prospecting Licence 19653-HQ-LPL in Zambia, as announced on 16 August 2016.

The facility provides that ACI will make available to EML upon achievement of

16  MODERN MINING  October 2016