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CRG reports strong production for first four months of 2013
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7th June 2013
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JOHANNESBURG ( – LSE- and JSE-listed gold miner Central Rand Gold (CRG) on Friday reported total mining production of 83 597 t for the first four months of the year, against a target of 83 604 t.

The overall mined grade was 3.25 g/t gold, marginally lower than 3.92 g/t in 2012. CRG noted, however, that the drop in grade was not permanent and that it would continue to fluctuate depending on the mining area. The company remained confident that the overall resource grade of 3.57 g/t was achievable over the life of the mine.

The challenges experienced owing to the lack of availability of the smaller Bateman mill continued through January and February and, albeit to a lesser extent, in April. Gearbox modifications were again undertaken in April and early May to improve the reliability of the mill, which was running well on a single gearbox and offering availability in excess of 80%.

CRG attributed the drop in its cash and cash equivalents balance at the end of April to $2.1-million, from $4.5-million in December 2012, to a loss of production through poor plant performance in January, February and April.

The recent drop in the gold price had also put additional strain on cash reserves; however, this was somewhat offset by the weakening rand/dollar exchange rate and the miner’s improving mine-call factor, with operations retaining a solid 74% of gold from working face to gold pour in April.

The miner was investigating the procurement of a second 9 ft x 12 ft ball mill to serve as a backup and potential replacement for the Bateman mill.

The 9 ft x 12 ft carbon-in-leach mill continued to perform well during the period with average availability exceeding 90%. Low availability of the mill during January was attributable to a planned swap-around of a pinion gear that overran the scheduled time frame as a result of unforeseen complications.

Gold production increased to 1 205 oz in April as a result of a relatively stronger performance by the company’s ore processing plant and a significant step-up in tolling tempo.

Grades showed a steady increase as improved waste-sorting techniques were adopted to cope with thin, but high-grade reef production. This trend continued through May with indications of belt grades in the mid-2 g/t range.

Meanwhile, potential retrenchments in terms of Section 189 of the Labour Relations Act, which CRG had planned as per its strategic review, had been suspended. This was brought about following a reassessment of the capital cost required to meaningfully increase the availability and capacity of the gold process plant beyond the current capacity.

Further, a high-capacity crushing circuit would be implemented in July, coupled with the option of adding the 9 ft by 12 ft mill to complement the current milling arrangement. CRG indicated that this would significantly reduce the unit operating cost of its mine to well below commercial tolling rates, while allowing for superior plant availability.

On another front, the Simmer & Jack Mines prospecting right was executed on June 5, following a lengthy administrative delay. The right covered a South African Mineral and Resources Committee- (Samrec-) compliant shallow main reef leader resource of 190 000 oz of indicated resource and 40 000 oz of inferred resource, as well as a Samrec-compliant main reef leader exploration target of 3.16-million ounces.

CRG pointed out that there was also a considerable unmined potential in the Kimberley and White Reef horizons in the area, which offered good targets for further development.

The execution of the right marked the start of a new five-year exclusive prospecting term, and granted CRG the sole right to apply for a mining licence during the term on the back of positive prospecting results.

Meanwhile, construction on the high-density sludge treatment plant was on track, with commissioning set for early November. The treatment plant was expected to be fully operational by early 2014.


Since 2009, CRG had been disputing with black-empowered Puno Gold Investments, who was seeking an interdict to prevent CRG from carrying out trial mining at the Consolidated Main Reef, Langlaagte, City Deep and Crown Mines tenements.

In November 2012, the Deputy Judge President issued a directive letter to Puno and CRG setting out requirements for the further prosecution of the matter, including, but not limited to, the date upon which Puno was required to serve and file its heads of argument, which was April 15.

However, four days before the deadline, Puno terminated the mandate of its then attorneys of record. This was followed by a request to the office of the Deputy Judge President seeking an indulgence for the late filing of Puno's heads of argument, on April 19.

At the end of May, CRG was informed that the Judge President was deciding on the special allocation of a further hearing date of the application to expedite the matter.

Edited by: Chanel de Bruyn


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