Modern Mining December 2017
December 2017 Vol 13 No 12 www.crown.co.za M ODERN MINING
IN THIS ISSUE… Fekola hits the ground running
Cooling system for historic gold mine Increase in Arcadia project’s ore reserve Feature: Bulk materials handling
MODERN M I N I N G
MINING NEWS 4 Fekola races into commercial production 4 Rainbow ships its first rare earth concentrate 5 Balama produces its first flake graphite 6 Pre-Feasibility Study on Malingunde now underway 6 Sizes determined for re-discovered kimberlites 7 De Beers puts Voorspoed on the market 8 ‘Smart Ore Movement’planned for Gamsberg 9 Firestone adopts a new mine plan for Liqhobong 10 Mutamba pilot plant officially opened 11 Danakali advances Colluli bidding process 12 GSR shines in Ghana Mining Industry Awards 13 Battery Minerals prepares for Montepuez development PRODUCT NEWS 36 Two new versatile tools in BMG range 36 Circuit breakers designed for harsh environments 37 Functional and affordable ‘comms’for underground 37 Valve sleeve changed in just 80 minutes 38 Heavy Kwatani screens for Gamsberg 39 Ranger drill rigs push the envelope 40 Vortex pump range from Becker Mining 40 SKF supplies dual solution toWest African gold mine COVER 14 TAKRAF Africa poised for further growth in 2018 COOLING AND VENTILATION 18 BBE Projects commissions cooling system at Fairview LITHIUM 20 Significant increase in ore reserve at Arcadia project TECHNOLOGY 22 Mechanisation gains momentum FEATURE – BULK MATERIALS HANDLING 26 Local engineering for a true ‘pit-to-port’ solution 30 Scientific approach to chute design lowers end-user costs 33 Training the key to the safe use of splicing equipment 34 Maptek provides the tools for stockpile measurement REGULARS
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Cover Installation of a 2,74mx 4,88m semi- mobile Bradford Breaker at Black Wattle Colliery in Mpumalanga. The breaker was supplied by TAKRAF Africa. See page 14 for a profile of the company.
Average circulation (July–September 2017) 4270
December 2017 MODERN MINING 1
Is 2018 likely to be a better year for Africa’s miners?
W ith 2017 drawing to a close as I write this, I have to say that the year was generally not a great one for mining in Africa – West Africa apart. Things in South Africa have gone from bad to worse with all the issues surrounding the proposed new Mining Charter unresolved, while Zambia, Namibia, Botswana, Zimbabwe and the DRC have all been quiet in terms of mining activity. In Zimbabwe the 51 % indi- genisation rule continued to deter new mining investment and in Tanzania radical and arbi- trary changes to mining legislation that were imposed mid-year have not exactly been posi- tive for the country’s mining sector. The situation in South Africa is particularly dire and there have been endless prognos- tications of doom over the past 12 months, with many industry leaders predicting that the industry will shrink further in the years to come unless urgent measures are taken to improve the regulatory climate in the country. Anglo American Chief Executive Mark Cutifani, for example, stated categorically in late November (at an Anglo American media function) that, in the absence of change, a fur- ther 100 000 jobs in mining would be lost in the next five to seven years. He said South Africa had to rebuild the industry and added that the country would not get any inward investment in mining “unless we can deliver a return.” What of prospects for 2018? Looking at South Africa, there are some biggish projects around. South32 has approved its R4,3 bil- lion Klipspruit Life Extension project at South Africa Energy Coal, Ivanhoe is working at full tilt on its Platreef mine near Mokopane, with Shaft 1 having passed the 500 m mark and early-works construction for the giant Shaft 2 underway, Exxaro has started work on its R3 billion plus Belfast coal project and SepFluor has begun development of its R1,7 billion Nokeng fluorspar mine. Other projects in progress include Gamsberg (which will start producing in mid-2018), Exxaro’s R4,7 billion GG6 project at Grootegeluk and Northam’s plus R4 billion Booysendal South expansion, which is now well into the construction phase. On the horizon is the Waterberg PGE project north of Mokopane, in which Impala is now involved. There are now no less than 17 drill rigs on site, which indi- cates the serious intent of the developers. Outside of South Africa, the change of lead- ership in Zimbabwe could lead to some sort of mining boom in the country (one hears that the
mining community in the country is in a buoy- ant mood) while in Zambia Vedanta Resources, which controls Konkola Copper Mines, is reportedly investing an additional US$1 billion in its operations in the country. Over the border in the DRC, Ivanhoe – what would we do without this company? – is pur- suing the Kamoa/Kakula and Kipushi projects, with Kamoa and Kakula both in construction (at least in terms of the mining infrastructure) and a new PEA on the combined projects hav- ing just been released. New investment is also on the way from Katanga Mining, which has just announced the approval of US$237 mil- lion in capital expenditure spread over 2018 and 2019 to construct a sulphuric acid and sul- phur dioxide production plant at its subsidiary Kamoto Copper Company (KCC) in Kolwezi. Further north in the country in North Kivu province Alphamin is moving into top gear with its Bisie tin mine. I can’t see too much in the pipeline in the immediate future in Tanzania but in Mozambique Battery Minerals is planning to be in production with its US$42,3 million Montepuez graphite project by the end of 2018. Also in Mozambique, the Savannah/Rio Tinto joint venture is continuing to make good progress on the Mutamba mineral sands proj- ect, which ultimately could represent a major investment in the country. On the other side of the continent in West Africa levels of activity should remain high, with Endeavour having started development of its big US$400 million Ity CIL project in Côte d’Ivoire, Perseus building Sissingué (the first gold pour is expected in March 2018), also in Côte d’Ivoire, Newmont busy with its Ahafo mill expansion in Ghana and Roxgold about to embark on the Bagassi South expansion at its Yaramoko site in Mali. There are, of course, any number of projects in the West African region (mostly gold) at an advanced stage, including – to name just three of the most significant – Yaoure (Perseus) in Côte d’Ivoire, Massawa (Randgold) in Senegal and Kalana (Endeavour) in Mali. Most of them are unlikely to go into execution until at least 2019 but it’s good to know they’re in the pipeline. Summing up, one feels that there is probably enough going on in Africa in mining to make 2018 a reasonably active, if not a boom, year. Let’s hope this is the case. The mining industry has taken some hard knocks over the past two or three years and now desperately needs some good news and a period of sustained growth. Arthur Tassell
The situation in South Africa is particularly dire and there have been endless prognostications of doom over the past 12 months.
December 2017 MODERN MINING 3
The processing plant at the Fekola gold mine. Recoveries are currently running ahead of budget (photo: B2Gold).
Canada’s B2Gold Corp reports that its new Fekola gold mine in Mali achieved com- mercial production on 30 November, one month ahead of the revised schedule and four months ahead of the schedule announced in the Optimised Feasibility Study (OFS). Ramp up to full-scale production at Fekola remains ahead of schedule with gold production well above budget in each of the ramp-up months, beating original recovery, grade and plant availability esti- Fekola races into commercial production mates in the OFS design. By 30 November this year, the mine had produced around 80 000 ounces of gold, approximately 158 % above budget (31 000 ounces). Gold production from the mine in 2017 is now forecast to be between 100 000 and 110 000 ounces, far surpassing the upper end of the original guidance of 45 000 to 55 000 ounces. B2Gold has declared commercial pro- duction at Fekola based on an internal commercial productionmeasure of 30 con-
secutive days of mill throughput at 65 % or greater of nameplate capacity (607 dry tonnes per hour). During the 30 consecu- tive-day commercial test, the mill achieved an average throughput of 626 dry tonnes per hour. This included an availability for the mill of 95 % (budget was 70 %) for the test period and a recovery that exceeded 95 % (budget was 91 %). The Fekola mill started processing ore more than three months ahead of sched- ule on 25 September 2017, with the first pour achieved on 7 October. In October, the first full month of ramp-up and pre- Production of this batch of concentrate was achieved prior to completion of final commissioning of the processing plant through a primary crushing circuit capable of treating undiluted run of mine ore with- out requiring the gravity separation circuits incorporated within the total processing plant. Rainbow expects to move to truck con- voy shipments on at least a weekly basis during Q1 2018 as production increases. Mining has continued to make good progress at Gasagwe and has already deliv- ered the targeted ROM ore stockpile for the commissioning period. Rainbow says it is continuing to advance its understanding of the Gasagwe deposit in order to maximise mining production. It has recently made additions to the mining fleet on a rental basis to accelerate the rate of waste strip- ping and provide access to the high-grade vein material.
Rainbow ships its first rare earth concentrate LSE-listed Rainbow, the rare earth element mining company, has exported its first 25-tonne shipment of rare earth concen- trate from the Gakara project in Burundi. Gakara is one of the highest grade rare earth element mining projects globally, with an estimated in situ grade of 47-67 % Total Rare Earth Oxide (TREO).
and we now look forward to growing our monthly production levels over the com- ing months targeting a 5 000 t/a run rate by the end of 2018. “Rare earths have a vital input in some of the world’s fastest growing markets including renewable energy, electric vehi- cles, telecommunications and defence and due to the demand of these important technology metals prices have strength- ened considerably this year. We are eager to further increase our production pro- file and as such have been exploring the Gakara licence area alongside our devel- opment work which has resulted in the recent exploration success identifying four large anomalies. With initial production now underway, we look forward to further unlocking the value of Gakara for the ben- efit of our shareholders.”
Martin Eales, CEO of Rainbow, com- mented: “Rainbow can now rightly claim to be the only producing rare earths mine in Africa, and the highest-grade producer globally. We have successfully delivered on our stated strategy, having devel- oped the Gasagwe mine, constructed our processing plant to the point of final commissioning and now exported our first shipment of mineral concentrate, all within 11 months of IPO. This is a proud moment for all involved in the company
4 MODERN MINING December 2017
Balama produces its first flake graphite
commercial production, the Fekola mill treated 324 525 tonnes of ore (as against 225 804 tonnes budgeted) at an average grade of 3,40 g/t (2,33 g/t budgeted) with a gold recovery of 95,4 % (90,0 % bud- geted), producing a total of 33 946 ounces of gold in the month (surpassing budget of 15 100 ounces). Gold production at Fekola in November 2017 was approximately 40 000 ounces from 426 836 tonnes of ore (budgeted 316 000 tonnes) at an average grade of 3,05 g/t (2,33 g/t budgeted) with gold recoveries of 95,5 % (budget 91 %). The higher-than-budgeted grade is a result of the early start to mining in April 2017, allowing the site to stockpile ore and blend mill feed for optimal production. Based on the life of mine (LoM) plan, in 2018 – the first full year of Fekola pro- duction – the company is projecting production of approximately 400 000 to 410 000 ounces of gold from Fekola with low projected cash operating costs and an AISC of approximatelyUS$354 per ounce and US$609 per ounce, respectively. For its first three years of operation, Fekola is projected to produce approxi- mately 400 000 ounces of gold annually at cash operating costs of US$357 per ounce and an AISC of US$604 per ounce. B2Gold also reports that positive drill results from its US$15,4 million 2017 exploration programme in the Fekola area indicate that the main Fekola deposit, with additional drilling, could extend sig- nificantly to the north. In addition, drilling below the extensive saprolite resource at the Anaconda, Adder and Mamba zones has discovered three, well mineralised bedrock (sulphide) zones, indicating the potential for large, Fekola-style miner- alised zones. Drilling is ongoing to further test the Fekola North Extension zone, infill the Fekola resource and further test the new bedrock mineralisation beneath the Anaconda, Adder and Mamba saprolite resource. The company is planning addi- tional, aggressive exploration drilling programmes on these targets in 2018. The Fekola project is situated in south- western Mali, on the border between Mali and Senegal, about 210 km south of Kayes and 480 km (by road) from Bamako, Mali’s capital. The project entered B2Gold’s port- folio in 2014 as a result of its acquisition of Papillon Resources.
View of the Balama processing plant looking west (photo: Syrah).
ASX-listed Syrah Resources has announced the first production of bagged saleable flake graphite from the Balama project in Mozambique. Shaun Verner, Syrah’s Managing Direc tor and Chief Executive Officer, said, “This is a significant achievement for Syrah, our subsidiary Twigg, and our host com- munities in Mozambique as the company moves into operations. The development of Balama has been achieved through an extremely dedicated construction, com- missioning and operations team, with great support from the local communi- ties, investors, suppliers, government and other stakeholders. We look forward to reli- ably and consistently supplying the global graphite market and our planned Battery Anode Material operation with the highest quality natural graphite.” He added, “Following the intermedi- ate concentrate produced in late October, Syrah has now successfully commissioned the final stages of the flake circuit includ- ing polishing, filtration, drying, screening and bagging. Flake graphite produced is within our expected grade range, in excess of 95 % fixed carbon. Remaining commissioning activities will focus on the fines circuit and further optimisation works. We expect our first shipment of flake product fromNacala Port in the com- ing weeks. First cash receipts are expected in early 2018 with production of 160 000 to 180 000 tonnes in 2018, following cus- tomer qualification processes.” According to Syrah, all major proj- ect construction works at Balama are essentially complete with remaining con- struction activities limited to electrical
and instrumentation works, completion of construction punch list items and veri- fication checklists for the fines circuit. Demobilisation of construction teams is well underway. Balama is a simple, low strip ratio, open-pit operation. Processing utilises conventional processes including crush- ing, grinding, flotation, filtration, drying, screening and bagging. The processing rate is 2 Mt/a with the nameplate capacity being 380 000 tonnes of graphite concen- trate per annum. Production restarts at Oena Tango Mining, listed on the TSX-V, has announced the recommencement of pro- duction at its Oena diamond mine located in the Northern Cape. Bluedust 7 Proprietary has mobilised and commissioned mining and processing equipment, including a Bourevestnik X-ray sorter (BVX), to Oena. The ‘Contract Mining and Diamond Recovery Agreement’ with Bluedust, with regard to processing run of mine (ROM) gravel, has been amended to include con- sideration for diamonds recovered from the processing of pan tailings and bantam material (Tailings) left on site from previous mining operations. Bluedust, at its own cost and expense, provides and maintains all the plant and equipment as required and the diamonds recovered will be sold at a designated tender facility in South Africa, of which 40 % of the gross income, less commis- sion recovered from Tailings, will be paid to Tango’s subsidiary for the duration of the 60-month contract.
December 2017 MODERN MINING 5
Pre-Feasibility Study on Malingunde now underway
that it has been granted additional ground directly along strike of the Malingunde deposit. The new ground is to the south-east of the deposit, extend- ing the prospective strike length of the ‘Malingunde Trend’ by approximately 25 km. Previous exploration is known to have intersected saprolite-hosted graphite mineralisation in this newly granted area. Commenting on the award of the new licence, Sovereign’s Managing Director, Dr Julian Stephens, said that the company now controlled the entire Malingunde Graphite Trend, providing significant scale and optionality upside to the exist- ing resource that has been defined at Malingunde. “Sovereign’s in-country team will commence targeted exploration along strike from Malingunde over the upcom- ing wet season (December – March) using the very cheap and effective hand-auger exploration tool,” he said. Malingunde is located just 15 km south- west of Lilongwe, Malawi’s capital city. The discovery was made in 2015 by Sovereign’s in-country geological team using hand-auger drilling techniques in an area of no outcrop. In April 2017, Sovereign reported a maiden mineral resource esti- mate (MRE) of 65,1 Mt at 7,1 % TGC (Total Graphitic Content) at a 4 % TGC lower cut-off grade (saprolite, saprock and fresh rock). The MRE, prepared by CSA Global, includes a high-grade saprolite compo- nent of 8,0 Mt at 10,0 % TGC. The next phase of work at the Free State project will consist of an analysis of the indicator mineral chemistry for each of the pipes to determine an economic interest rating which will prioritise further work. This follows field observations of exten- sive historical workings which suggest that these kimberlites are diamondiferous. This is planned for early in 2018. “The re-discovery of eight kimberlites in a highly prospective diamond area was very positive,” comments John Teeling, Chairman of Botswana Diamonds.“We now know the sizes of each pipe/dyke and we believe that each could contain diamonds. The next step is to evaluate the diamond indicator minerals in each pipe to decide priorities for drilling.” Koffiefontein is also well known for the high-quality gems it produces.
A drill site at the Malingunde graphite project (photo: Sovereign Metals).
ASX-listed Sovereign Metals reports that the Pre-Feasibility Study (PFS) for the low cost Malingunde saprolite-hosted graphite project in Malawi has begun. The company says the PFS will build on the outstanding results delivered in the Scoping Study, which highlighted the potential for a very low capital and oper- ating cost operation with annual graphite concentrate production of approximately 44 000 tonnes over an initial mine life of 17 years. Sovereign reported the results of the Scoping Study in June 2017. A number of opportunities were identified in the study to further enhance the project economics. The company has completed a compre- hensive review of the Scoping Study to assess these opportunities and define
key work programmes for the PFS. Following completion of the review, the scope of work for the PFS has been finalised, with key activities including a 6 000 m infill and extensional aircore drilling programme; mine design, including optimisation of the mining schedule and mine-site layout; a substantial metallurgical programme, pro- cessing multiple samples to optimise the flotation regime, producing concentrates for evaluation by offtake partners and for further downstream test-work; and process design and engineeringworks based on the results of the metallurgy programme. Sovereign is targeting completion of the PFS in mid-2018, with certain work programmes designed to continue directly through into the DFS stage. The company has also announced gravity geophysical techniques, which has resulted in very strong images of the foot- prints of these kimberlites. The kimberlites occur along a north-west to south-east trending kimberlite feeder system along which the diamond mines of Jagersfontein, Koffiefontein and Kimberley are located. It is therefore inferred – says Botswana Diamonds – that the eight kim- berlites were formed at the same time as these mines. Recent whole rock geochem- istry shows similar compositions in the kimberlites to the surrounding mines. Jagersfontein is renowned for the blue gems it produced, and the Excelsior (972 carat) and Reitz/Jubilee (651 carat) dia- monds recovered from it are amongst the 10 largest diamonds ever discovered.
Sizes determined for re-discovered kimberlites Botswana Diamonds, listed on AIM, has announced results from its third ongo- ing exploration project in South Africa. The Free State project is situated between Bloemfontein and Kimberley, the historic centre of the diamond industry, where kim- berlite was first identified.
Following the company’s announce- ment in October 2017 regarding the re-discovery of eight Group 1 kimberlites, detailed ground geophysical survey work was undertaken by Geofocus. The survey work was aimed at determining the surface area of these kimberlites. Results indicate the sizes of these kimberlites to range from 0,3 to 1,15 hectares. The sizes were determined using a com- bination of magnetic, electromagnetic and
6 MODERN MINING December 2017
More good drill results from DRC gold deposit
Ortac Resources has announced further significant new gold assay results from the expansion and infill drill programme cur- rently underway at its Akyanga gold deposit, part of the Misisi gold project in the DRC. Highlights of the latest batch of drill results include 8,70 m at 3,90 g/t Au from 98,40 m, including 2,80 m at 10,62 g/t Au from 100,20 m; and 27,50 m at 2,86 g/t Au from 110,60 m. Nick von Schirnding, Ortac’s Executive Chairman, commented: “It is encouraging to see that the expansion and exploration drilling continues to intersect substantial thicknesses of mineralisation at grades of well over 2 g/t of gold. The results of this drill- ing will continue to fill the gaps in the current resource model and improve our geological understanding of the Akyanga deposit. “With the acquisition of CASA Mining Limited well underway, our executive team has shifted its focus and work in the DRC to better understand the rest of the large-scale project. Our gold belt licence extends to over 55 km where significant grades of gold have already been identified in previous drill- ing and trenching activities, which we are currently reviewing.We continue to see signif- icant upside potential to build a gold resource beyond our initial 2-million-ounce target.” Ortac recently announced a strategic review inwhich it decided to focus exclusively on its high-potential African exploration and mining assets, including CASA’s Misisi gold project in the DRC’s South Kivu Province. The company is in the process of complet- ing an offer to acquire all the outstanding shares in CASAMining Limited, a private com- pany focused on developing the Akyanga deposit, one of several potential resources within the Misisi gold project in the DRC.
The Voorspoed diamond mine (photo: De Beers).
De Beers puts Voorspoed on the market
De Beers Group recently announced it is seeking expressions of interest from potential buyers for its Voorspoed mine near Kroonstad in the Free State. After evaluating a range of options, the decision to place Voorspoed mine on the market has been taken to provide the opportunity for responsible lower-cost operators to employ a different operat- ing model. De Beers believes this could potentially extend the mine’s operating life beyond 2020. Potential buyers will be required to exhibit a record of success technically and financially and to meet all applicable regulatory and social requirements while economically and sustainably operating the mine. Phillip Barton, CEO of De Beers Consoli dated Mines, said: “I am very proud of the Voorspoed mine team, who have contrib-
uted so much to the operation’s success to date and ensured it has always operated to the highest standards of environmental and social performance. However, based on our experience with other operations, we believe the most responsible course of action is to give other lower-cost operators the opportunity to purchase the mine and potentially extend its life, as this will maxi- mise the benefit for the community and the mine’s workers.” The Standard Bank of South Africa Limited has been appointed as financial adviser to De Beers on the proposed dis- posal process of Voorspoed mine. In its South African portfolio, De Beers also operates the Venetia mine in Limpopo Province and is currently making its largest ever investment in South Africa with a R20 billion project to take the mine underground.
December 2017 MODERN MINING 7
‘Smart Ore Movement’ planned for Gamsberg
available information about the state of the mine, the quality of ore, the conditions of the concentrator and the value of the product are not only made available to the mine management team in real-time, but that the information is presented in such a way that it allows for minute-by-minute decision-making. The ‘Smart Ore Movement’ initiative allows business information to be derived from spatial data which has its source in disparate and standalone systems that will provide the ability to blend near real- time and manage adherence to the plan; ensure effective grade control; and allow continuous spatial reconciliation of actual production against plan. The initiative will allow the Gamsberg management team to apply appropri- ate operational insight and to ultimately co-act with the mining contractor to effec- tively manage the mine’s key performance indicators which are critical levers influenc- ing the variance between the predicted and actual mine feed to plant. Ultimately, says VZI, the aim is for Gams berg to be a ‘best-in-class’ operation – one that is safe, efficient and sustainable, and that delivers benefits to a broad range of stakeholders. The first phase of the Gamsberg proj- ect is expected to have a mine life of 13 years, replacing the production lost by the closure of the Lisheen mine in Northern Ireland. Once commissioned, it is expected that the mine will take 9-12 months to ramp up to full production capacity of 250 000 t/a of zinc-in-concentrate. Cost of production is estimated at US$1 000 to US$1 150 per tonne. licence, which is consistent with our strategy to target raw materials and technologies geared to accelerating growth in the elec- tric vehicle market,” says Alexander Lemon, President of Mkango.“Both nickel and cobalt are increasingly in demand as cathodemate- rials for batteries in electric vehicles. “This new licence, when combined with the Songwe Hill rare earths project and our collaboration with Metalysis on neo- dymium alloys for permanent magnets, positions Mkango as a potential future supplier of the critical raw materials used in both batteries and permanent magnet motors in electric vehicles.”
A view of the Gamsberg site showing the plant area in the foreground and the access road to the mining area (photo: VZI).
Vedanta Zinc International (VZI) says that its Gamsberg zinc project near Aggeneys in the Northern Cape, currently under con- struction and due to start production in mid-2018, will be one of the most digitally advanced new mining projects in Africa. According to the company, Gamsberg’s design and construction has aimed to be at the forefront of this digitalisation revolu- tion from the start of operation. “For VZI, the digital transformation is not something that is planned in years to come, but one that is taking shape today,” says the company.“Great strides have been made in recent years in the development of smart technology and equipment. This has given impetus to VZI’s ‘Adapt and Thrive’
approach. The next wave in both invest- ment and implementation will be in the integration of these systems to enable our teams to make data-driven decisions to find efficiencies, improve planning, lower risk, create safer working environments and unlock more value from our resources.” In November 2017, VZI announced a significant collaboration initiative with global innovation giant, GE, and leading mining software developer, MineRP. The first component of this collaboration will be the launch of ‘Smart Ore Movement’ at Gamsberg, withmore developments to fol- low in the coming months. The concept of ‘Smart Ore Movement’ centres on the need to ensure that all indicate exploration potential for additional nickel/cobalt mineralisation Mkango will re-evaluate the Chimimbe Hill deposit in the context of geophysical data produced by the recent World Bank airborne geophysical survey of Malawi, as well as recent infrastructure develop- ments in the region. The company also sees potential synergies with its Songwe Hill rare earths project and Thambani uranium-tan- talum-niobium project, both in Malawi. “We are delighted to have been granted the Chimimbe Hill nickel/cobalt exploration
Mkango Resources awarded exploration licence Mkango Resources, listed on AIM and the TSX-V, has announced that it has been granted an exclusive prospecting right covering the Chimimbe Hill nickel/cobalt deposit and other targets in Mchinji district, central Malawi.
The Chimimbe Hill licence covers an area of 98,48 km 2 and features laterite- and saprolite-hosted nickel, cobalt, chrome and other mineralisation. Significant historical exploration has been completed, including pitting, drilling and metallurgical test work. Magnetic anomalies in the licence area
8 MODERN MINING December 2017
Firestone adopts a new mine plan for Liqhobong
In its recently released final results for the year ended 30 June 2017, AIM-listed Firestone Diamonds, which operates – and has a 75 % stake in – the new Liqhobong diamond mine in Lesotho says that com- mercial production at the mine was achieved on 30 June 2017. During the year, 365 891 carats were recovered and 310 376 carats were sold at an average price of US$90 per carat, generating revenue of US$27,8 million. Cash operating costs, says Firestone, were well managed at US$12,26 per tonne treated. Firestone notes, however, that the weak- ness in the diamond market and the lower than expected occurrence of larger, better quality diamonds have resulted in lower prices being achieved at its sales. This has resulted in the company adopting a shorter nine-year revised mine plan (previously 14 years) which it believes will deliver the best returns in the medium term at low risk. The plan, says Firestone, offers the optionality of taking advantage of the longer life of mine should the average diamond values received increase or should there be an improvement in market conditions. The lower average diamond prices achieved at sale to date have been disap- pointing but an improvement in average value per carat recovered is expected as mining progresses into all areas of the pit, says Firestone. Firestone recorded a loss before tax for the year of US$130 million, which includes an impairment charge of US$122,6 million reflecting a re-assessment of the carrying value of the Liqhobong asset. The com- pany says it is planning a potential capital raise of US$25 million to provide additional working capital and to sustain the com- pany at the current lower-than-expected average diamond values. Reviewing the year, Firestone notes that it saw the transition of the company from development to diamond produc- tion. “The transition was well managed and nameplate capacity of the plant was achieved early in the ramp-up phase. Steady state production targets for ore treated and waste mined were achieved from April 2017 onwards, only seven months after commencing operations,” says the company. “The ramp-up was not without its challenges, with recovered grade being
an initial issue. This, together with other commissioning issues which are normal in the ramp-up phase of a new plant, were resolved as far as possible by the end of March 2017 which enabled the plant to run at full production levels for a sustained Mining operations in progress at Liqhobong (photo: Firestone Diamonds). Katoro Gold commissions LiDAR survey AIM-listed Katoro Gold has commissioned a Light Detection and Ranging (LiDAR) sur- vey at its Imweru gold project in Tanzania to further strengthen the Pre-Feasibility Study (PFS), which remains on track for comple- tion in the near term.
three-month period, achieving commercial production by the end of the financial year.” A particular highlight of the year was the recovery of Liqhobong’s first plus 100-carat stone in April – a 109-carat gem- quality diamond.
estimation and optimised mine design. The airborne LiDAR survey will be exe- cuted with a Piper PA-32 Cherokee 6, which is modified for this purpose and approved by the Tanzanian Civil Aviation Authority. The approximate US$14 000 cost of the LiDAR survey will be satisfied through the issue of new ordinary shares in Katoro on delivery of the survey report. Additionally, Katoro recently completed Phase 2 of the ESIA, used for predicting and assessing the potential environmental and social impacts of a project, evaluating alternatives and designing appropriate management and monitoring measures. It has subsequently received approval from the National Environmental Management Council to proceed with Phase 3 (final phase) of the ESIA. Louis Coetzee, Executive Chairman of Katoro commented: “We are delighted to have commissioned the LiDAR survey, which will add integrity and confidence to the PFS. Thanks to completing previous milestones at Imweru ahead of schedule, we can deliver this supplementary survey without compromising the timeline for the PFS and at no additional cash cost.”
Katoro is advancing Imweru through a work programme consisting of the com- pletion of a PFS, a drilling programme, a feasibility study and the application for a mining licence, as well as an Environmental and Social Impact Assessment (ESIA). Accordingly, as a valuable addition to the PFS, a LiDAR survey has been commis- sioned without compromising the timeline or budget. The survey will use pulsed laser light to create a highly accurate data set over the entire envisaged Imweru mining area. The survey will measure the distance to a sur- face target area by illuminating that target with a pulsed laser light, and in doing so measuring the reflected pulses with a sen- sor. In the case of Imweru, this will be used to produce a digital topographical database to enable the creation of high-resolution topographical maps which will provide high accuracy data for the final resource
December 2017 MODERN MINING 9
as proof-of-concept for the future devel- opment model at Mutamba. Savannah is currently targeting first production in 2020 with an estimated average annual production of 456 000 tonnes of ilmenite and 118 000 tonnes of non-magnetic con- centrate over a 30-year life of mine. The Mutamba Consortium was formed late last year and partners Savannah and its wholly owned subsidiary, AME East Africa, with Rio Tinto. The consor- tium agreement combines Savannah’s Jangamo project with Rio Tinto’s adja- cent Mutamba project, which includes three deposit areas – Jangamo, Dongane and Ravene – and the Chilubane deposit, which is located 180 km to the south-west of Mutamba. Savannah is the operator of the proj- ect and can earn up to a 51 % interest in the combined project as it moves towards production through scoping, pre-feasibility and feasibility studies. The Consortium Agreement includes an offtake agreement on commercial terms for the sale of 100 % of production to Rio Tinto (or an affiliate). The project is located in the Gaza and Inhambane provinces of Mozambique in a world-class heavy minerals sands (HMS) region close to established infrastructure, approximately 450 km north-east of the capital city of Maputo. The global mineral resource estimate for the Mutamba project (Jangamo, Dongane and Ravene) currently stands at 4,4 Bt at 3,9 % total heavy minerals (THM) comprising both indicated and inferred category material and containing ilmenite, rutile and zircon This includes a high-grade portion of 92 Mt at 6,2 % THM, which was defined at Ravene. Kibo’s board believes that Mabesekwa presents a highly synergistic opportu- nity, being perfectly placed to address the chronic power shortages in Southern Africa. Furthermore, the project has many similarities to Kibo’s flagship asset, the MCPP, where a 300 MW‘mine mouth’power station is anticipated to be in production in 36 months from the date of achieving financial close. It is envisaged that with Kibo developing two similar power projects, considerable benefits will be realised including econo- mies of scale both in equipment, execution and project finance.
The Mutamba pilot plant (photo: Savannah Resources).
Mutamba pilot plant officially opened
Mutamba, which our fully owned subsid- iary AME is conducting on behalf of the Mutamba Consortium. The pilot plant will allow us to process samples and conduct tests on the extraction of minerals from the deposits. While things are still at a very early stage, a pilot plant is an important part of any project study and we look for- ward to the work ahead.” According to Archer, the overall market setting for TiO 2 feedstocks continues to improve and new supply of TiO 2 feedstocks will be required to meet forecast demand and to ease anticipated market tightness. The test work to be undertaken will act listed on the Botswana Stock Exchange. The transaction covers a 300 Mt subset of the current in situ 777 Mt coal mineral resource (SAMREC) defined by Shumba at Mabesekwa. The project is located approximately 40 km east of the village of Tonata and approximately 50 km south-east of Francis town, Botswana’s second largest city. Kibo envisages the project as a coal-based integrated ‘mine mouth’ power plant, with potential for incorporation of a solar component.
AIM-listed Savannah Resources has announced that construction of the 20 t/h pilot plant for its bulk metallurgical test work programme at the Mutamba mineral sands project in Mozambique has been completed. The plant was officially opened on 7 December by Daniel Chapo, Governor of Inhambane Province. Savannah’s CEO, David Archer, says the company has been delighted to see the continuing strong support for the project both from the Governor and all levels of government and local communities. “The commissioning of the pilot plant is an important step forward for our studies on
Kibo Mining to acquire interest in Mabesekwa KiboMining, listed on London’s AIM and the AltX in Johannesburg, has announced the agreed acquisition of an 85 % interest in the Mabesekwa coal independent power proj- ect in Botswana in an all share transaction. This is a major part of Kibo’s new strategy focused on re-positioning itself as a strate- gic regional electricity supplier on the back of its flagship Mbeya Coal to Power Project (MCPP) in Tanzania.
Kibo’s interest in Mabesekwa is to be acquired from Sechaba Natural Resources, a subsidiary of Shumba Energy, a company
10 MODERN MINING December 2017
Danakali advances Colluli bidding process
ASX-listed Danakali and its Joint Venture partner, the Eritrean National Mining Corporation (ENAMCO), have announced that following a comprehensive bidding process for the Colluli potash project min- ing contract, the technical and commercial compliance process is complete. Conforming bids have been processed through the Front End Engineering Design (FEED) mine plan, and evaluation of the technical and commercial compli- ance, in combination with an assessment of the overall value proposition, has resulted in a shortlist of two competitive bids. The technical and commercial com- pliance was evaluated and confirmed by AMC Consultants. Bid results will be included in the FEED economics. Final commercial negotiations advancing to the preferred service pro- vider will commence shortly. Bidders participating in the process visited Eritrea, the Port of Massawa and the future Colluli mine site. The bidders also conducted a comprehensive review of the Colluli mine plan and selected mining method. The FEED phase is well advanced and drawing to a conclusion. Final reviews of direct and indirect development capi- tal costs are underway and a revised ore reserve will be completed in December/ January in accordance with the require- ments of JORC-2012. “We are very happy to have progressed our bidding process and commercial and
The proposed Colluli processing plant.
technical evaluation of the mining bids,” says Danakali’s MD, Paul Donaldson. “We are also very happy to have real bids sup- porting the FEED economics and that they are very well aligned to our DFS estimates. We are now looking forward to the comple- tion of commercial negotiations to identify our preferred service provider as we con- tinue to advance the Tier 1 Colluli Sulphate of Potash (SOP) project. In addition to firm- ing up the project economics as the project advances towards construction, the opera- tional contracts are key inputs to support our ongoing funding discussions.” Colluli is located in the Danakil Depres sion region of Eritrea, and is approximately 75 km from the Red Sea coast, making it –
says Danakali – one of the most accessible potash deposits globally. Mineralisation within the Colluli resource commences at just 16 m, making it the world’s shallowest potash deposit. A definitive feasibility study (DFS) for the production of potassium sulphate was completed in November 2015. The DFS utilises a modular development approach whichmitigates risk while enhancing fund- ability and economic return. Phase I of the project is expected to pro- duce approximately 472 kt/a of premium SOP product with commissioning currently targeted for Q4 2018. The capital cost of Phase 1 is estimated at US$332,7 million. Phase II will double SOP production.
December 2017 MODERN MINING 11
Golden Star shines in Ghana Mining Industry Awards
of the Year (which was the inaugural award in this category) while the award for Best Graduate Research went to Ahmed-Salim Adam, Process Manager at the Prestea operations. A student of the Golden Star School in Bogoso village, Winifred Korankye Amoah, was also awarded first prize in the essay- writing competition, which was open to school children across Ghana. Sam Coetzer, President and Chief Executive Officer of Golden Star, com- mented: “We are delighted that GSBPL has been named Mining Company of the Year at the Ghana Mining Awards. Judged and awarded by Ghanaians, this award reflects the strong commitment to excellence demonstrated by all of our team. I am also very proud that our Chief Operating Officer, Daniel Owiredu, received the first ever Mining Personality of the Year award. Over his 11 years with Golden Star, Daniel has been at the forefront not only of our efforts to develop two high-quality min- ing operations but also to deliver a best in class approach to corporate responsibility.” Apart from Prestea, Golden Star also owns the Wassa gold mine in Ghana. It is developing high-grade, low-cost underground mines at both properties in conjunction with existing open-pit opera- tions. The Wassa underground gold mine commenced commercial production in January 2017 while the Prestea under- ground gold mine is expected to achieve commercial production shortly. Gold pro- duction in 2017 is expected to be between 255 000 and 280 000 ounces with cash operating costs of US$780-860 per ounce. In addition to the Ghana Mining Industry Awards, GSR has recently been honoured by the Prospectors and Developers Association of Canada (PDAC), being named as the recipient of the Association’s 2018 Environmental and Social Responsibility Award. This will be formally presented to GSR at PDAC’s annual convention in Toronto in March 2018. The award recognises an organ- isation that demonstrates outstanding initiative, leadership, and accomplishment in establishing and maintaining good relations with local communities and in protecting and preserving the natural environment during an exploration pro- gramme or operation of a mine.
Prestea is one of Ghana’s oldest mines, having produced in the region of 8 Moz in over a century of operation. Seen here is the Central Shaft, which has been refurbished as part of GSR’s development of a new underground operation at Prestea. It now has the capacity to hoist 1 500 tonnes/day (photo: Golden Star).
Golden Star Resources (GSR), listed on the NYSE American and TSX, has won five awards at the Ghana Mining Industry Awards, including Mining Company of the Year for its local subsidiary, Golden Star Bogoso/Prestea Limited (GSBPL), which operates the Prestea open pits and the Prestea underground gold mine (Prestea Underground) in south-western Ghana. Judged by a panel of industry pro- fessionals, the Mining Company of the Year award recognises an organisation that has achieved the highest aggregate
All five holes targeted the Koaltenga zone, an approximately 800 m long active orpaillage “We’re pleased with what is an excellent start to this programme,” said Nexus senior geologist, Warren Robb. “We are encour- aged with the extent of these intercepts and will continue to test these structures along strike.” The 250-km 2 Rakounga concession borders the company’s 38 km 2 Bouboulou concession. Nexus recently announced results from its maiden diamond drill pro- gramme at Bouboulou, with nine of the first 10 holes successfully intersecting gold. To date, a total of eight gold-bearing zones have been identified at the Bou boulou and Rakounga concessions. Golden Star was also selected as the Best Performer in Corporate Social Investment for its breast cancer aware- ness programme that involved screening over 10 400 women in Ghana during the past three years and was Runner Up in Occupational Health and Safety. In addi- tion, its Chief Operating Office, Daniel Owiredu, was named as Mining Personality performance results in the categories of environmental management, occupational health and safety, corporate social invest- ment, innovation and local content.
“Excellent start” to Rakounga drill programme Nexus Gold Corp, listed on the TSX-V, has announced assay results from the first five reverse circulation (RC) drill holes con- ducted at the Rakounga gold concession, located 109 km north of Ouagadougou in Burkina Faso.
Gold mineralisation was intersected in four of the first five holes drilled on the prop- erty. Significant results were returned from holes RKG-17-RC-001 and RKG-17-RC-002, which returned extended intercepts of 26 m grading 0,82 g/t Au, including 2 m of 4,11 g/t Au, and 32 m of 1,01 g/t Au, includ- ing 2 m of 5,65 g/t Au, respectively. The current drill programme is designed to test the mineral-bearing potential of the artisanal workings (orpaillages) referred to as Koaltenga, Porphyry and Gounga.
12 MODERN MINING December 2017
Battery Minerals prepares for Montepuez development sible, Battery Minerals has also initiated an extensive recruitment campaign. This will be aimed at identifying key development and technical personnel for roles in Perth and Mozambique.
from investors,” he continued. “As the Value Engineering Study showed, Montepuez will generate out- standing returns, including low quartile operating costs of US$337/t and a payback period of less than two years.” Battery Minerals is completing detailed grade control drilling to underpin daily mining plans ahead of the grant of the mining licence, expected shortly. Final approvals are due in the March quarter of 2018 to facilitate the scheduled start of construction in April 2018. The company says it remains on track to commence mine commissioning in the December quarter of 2018 with first graph- ite concentrate exports scheduled for the March quarter of 2019. The SMB-Winning consortium is to launch feasibility studies early in 2018 for the con- struction of an alumina refinery in Guinea as well as a railway to open up the Boffa corridor and to carry bauxite to the refin- ery and the Dapilon river port in the Boké region. The total investment planned for the whole project is estimated at US$3 billion. The construction phase – planned to start in 2019 – will create 10 000 jobs. Completion is expected by 2022. Founded in 2014, the SMB-Winning con- sortium brings together three partners in the fields of bauxite mining, production and transportation: Singaporean shipping company Winning Shipping Ltd; UMS, a French-owned transport and logistics com- pany that has been present in Guinea for over 20 years; and Shandong Weiqiao, a leading Chinese company in aluminumproduction. Railway and refinery planned for Guinea
ASX-listed Battery Minerals reports it has taken a series of key steps in preparation for the development of its Montepuez graphite project in northern Mozambique, ensuring the project is on track for produc- tion late next year (2018). The first phase of the project is designed to produce 45 000 to 50 000 t/a of graphite concentrate at a grade mined (TGC) of 12 %. The company has placed an order for a new primary crusher, which is already under construction and expected to arrive on site in March 2018. The primary crusher has a capacity of more than twice Montepuez’s requirements, giving it ample ability to meet the company’s needs for the planned expansion in 2020. According to Battery Minerals, it will be delivered at a significant discount to quotes received as part of the Value Engineering Study com- pleted in November 2017. Battery Minerals has also appointed highly experienced lead design engi- neers DRA and Minnovo to complete the detailed design work on the process plant for Montepuez. To help ensure the development of Montepuez can proceed as quickly as pos- South32 has approved the Klipspruit Life Extension project (KPSX) at South Africa Energy Coal. Development activity is expected to commence in the current quarter with first coal expected from the open-cut operation in FY19. Graham Kerr, South32’s Chief Executive Officer, said: “Approval of the R4,3 bil- lion Klipspruit Life Extension project will secure the future of the colliery for at least
The Montepuez project development preparations follow the completion of Battery Minerals’ highly successful capital raising in November 2017, in which the company raised A$20 million in a heavily over-subscribed share placement. Battery Minerals Executive Chairman David Flanagan said the demand for the capital raising reflected the financial strengths of Montepuez. “We have now secured a primary crusher with capacity of more than twice Montepuez’ require- ments, and sufficient for our planned expansion, but with no increase in fore- cast operating costs,” he said. “The lower than expected cost of the crusher augurs well for the company’s ability to build the project within the budget estimated in the Value Engineering Study “The low capital cost of just US$42,3 million and the short lead time of just 13 months to production has seen the com- pany and the project win strong support another 20 years, ensure employment for 740 people and create 4 000 jobs during construction. “The investment is expected to gen- erate an internal rate of return (IRR) on investment of more than 20 % by unlock- ing 616 Mt of resource at the Klipspruit South and Weltevreden deposits, and fulfilling around half of our current rail obli- gations with Transnet.”
South32 approves Klipspruit project
December 2017 MODERN MINING 13
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