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May 2017
MODERN MINING
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MINING News
volatile political climate in the DRC at present,”
Bristow said.
“Randgold remains committed to the DRC
and is confident that its government, politi-
cians and civil society have the will as well
as the capacity to work together to secure
the country’s future. We therefore continue
to invest in exploration here and to lead the
way in developing the north-eastern DRC as a
major new gold mining region. Our engage-
ment with the country and its people is also
evident in our substantial investment in local
economic development and community
upliftment programmes. These include macro
and micro agribusinesses designed not only to
provide regional food security but to generate
surplus produce for export.”
It was a source of concern, however, that
the DRC government had once again signalled
its intention of reviewing the country’s 2002
mining code with the clear intention of maxi-
mising state revenue, Bristow said. This could
have a very negative impact not only on the
mining industry but also on the economy.
“Now more than ever the DRC should be
focused on retaining its existing investors and
attracting new ones. It’s certainly not the time
to harvest more from less for short term gain.
It’s my sincere hope that this time round the
government will engage the mining sector
fully in the proposed review to achieve an out-
come that will be in the best interests of the
Congolese economy as well as the country’s
mining sector,” he said.
“The existing code is in fact a good one
but it is not always being applied effectively
and there are still many mining operations
that do not operate under the code. There
are also a number of issues and challenges
which mining companies are having to face
which make operating in the DRC more chal-
lenging. In Kibali’s case, these issues include
more than US$200 million in unpaid TVA and
duty refunds.”
ASX-listed Acacia Coal has announced that a
Pre-Feasibility Study (PFS) has found that its
flagship Riversdale Anthracite Colliery (RAC)
project in South Africa will generate strong
financial returns for shareholders.
The study shows that the project is esti-
mated to cost just A$24 million to build on an
outsourced operational model, with sustain-
ing capital of A$7,85 million and is forecast to
generate an average 438 000 tonnes of sales
per annum for an initial eight-year mine life.
Based upon an average selling price of
A$125,1/tonne FCAmine gate and an effective
6 % royalty rate, the project study demon-
strates a cash margin after tax of A$34,40/t.
The PFS found that these financial
parameters would result in an outstanding
internal rate of return of 53 % and underpin
a net present value at a 10 % discount rate of
A$73 million.
Acacia Managing Director Hugh Callaghan
said the combination of the extremely high
quality nature of the RAC coal and the declin-
ing inventory of metallurgical coal in South
Africa was at the heart of the project’s strong
outlook.
Metallurgical test work conducted as part
of the PFS found the RAC coal was ideal for use
in South Africa’s ferrochrome industry, which
is struggling to source sufficient quantities of
low phosphorus and low sulphur anthracite.
Callaghan said these factors were respon-
sible for the strong price environment which,
when coupled with RAC’s low costs, would
enable the project to enjoy robust margins.
“The PFS shows that the RAC project ticks
every box, ranging from a premium-quality
product through to low costs and strong
margins,” he said. “The project is ideally
placed to capitalise on the strong supply-
demand fundamentals in the South African
premium metallurgical coal market. There is
also encouraging potential to grow the mine
life with further drilling of both the Gus and
Alfred seams.”
The PFS, led by VBKom, examined all
aspects of geology, mining, processing and
supporting infrastructure at market prices for
anthracite, to a nominal accuracy of ±15 %.
The trade-off and detailed optimisation
studies delivered an optimal development
scenario of an average 60 000 tonnes per
month underground mining operation using
conventional mining in a bord-and-pillar
configuration.
It is envisaged that three adits will be
developed and six sections established in a
phased ramp-up. The mining operation will be
undertaken by a contractor with 70 % of the
equipment fleet being provided by Acacia.
Pre-Feasibility Study indicates strong
returns for Acacia's Riversdale project