Name of the Project
Egoli project.

Location
The project is located in Mpumalanga, South Africa.

Project Owner/s
Pan African Resources.

Project Description
The Egoli project will be South Africa’s newest underground gold mine. The mine will capitalise on Evander Mines’ existing infrastructure, reducing the upfront capital investment.

The project is expected to contribute incremental production of about 72 000 oz/y over its minimum nine-year mine life at a head grade of 6.61 g/t of gold.

Life-of-mine (LoM) gold production is estimated at 570 000 oz.

The LoM excludes the inferred mineral resources of 6.26-million tonnes at 9.68 g/t of gold, which will be accessed once underground development is in place, and can potentially increase the LoM to 14 years.

The project initially requires about 560 m of underground development from the existing No 3 decline and will benefit from existing infrastructure such as vertical shafts, hoisting capacity and an operating metallurgical processing plant.

The existing Kinross metallurgical plant will be refurbished to process the ore.

Potential Job Creation
The project is expected to provide employment for about 1 200 people.

Net Present Value/Internal Rate of Return
The project has a net present value of R2.01-billion and an internal rate of return of 50.1% at a gold price of $1 650/oz. Project payback is estimated at 3.8 years

Capital Expenditure
Peak funding is estimated at R1.05-billion. Finalisation of the legal agreements for the implementation of the project’s debt funding package is under way.

Planned Start/End Date
The project is expected to take 20 months to complete. Ramp-up to steady-state production is expected to take 16 months thereafter.

Latest Developments
DRA Global is proceeding with project scheduling and planning as the next phase of development. Early works started in October 2020. The scope includes the defining of engineering, procurement and construction management (EPCM) documentation in preparation for the execution phase of the project.

The contract is expected to be completed in the third quarter of 2021.

Work currently in progress includes the optimisation of the ventilation and refrigeration design, dewatering designs and water balance for the project.

Requests for quotations on dimensional and nondestructive testing inspections on all winders have also been distributed to contractors.

Key Contracts, Suppliers and Consultants
DRA Global (feasibility study and EPCM).

Contact Details for Project Information
Pan African Resources, Juanita Maijsen, tel + 27 11 243 2900 or email ExecPA@paf.co.za.