JOHANNESBURG (miningweekly.com) – Contract mining company JIC Mining Services of Midrand is taking immediate steps to bring Pamodzi Gold's Orkney gold mine out of care-and-maintenance and back into production, initially restoring 1 200 jobs and later all 2 800.

Liquidator Enver Motala of SBT Trust said that production would take place under the supervision and control of the joint provisional liquidators, which included Allan Pellow of Westrust and Deon Botha of Corporate Liquidation, with JIC acting as a service provider.

This was, he said, not the conventional type of liquidation, in which assets were swiftly realised for onward distribution to creditors. Instead, production would be resumed on a staggered basis in the hope of full reemployment by July.

JIC had already been keeping the Orkney operation on care-and-maintenance using 120 employees.

“Rather than go for a fire-sale approach, the liquidators have taken the bold step to make every attempt to resuscitate the mine’s revenue cycle so that the workers and creditors can obtain some settlement,” JIC CEO Jagdish Parekh said, his company itself providing between R18-million and R20-million in interim funding.

JIC COO Henrik Kruger said that his company would ensure that every employee returning down the old and deep Orkney mine would be kept safe.

“We’re confident of returning to operation in a very short time and then bringing back the mine’s real operating potential in a period of three to five months,” Kruger said.

By the end of May, production would be brought to 99 kg to 100 kg of gold month and at the end of four months to 160 kg a month, which would be sufficient production to enable the mine to service all its commitments.

“In the first few months, there will not be any profits, because of the need to go back in safely, but at the 160 kg a month mark, we should be at a breakeven point,” Kruger said.

Pamdozi Gold manager Francois Naude said that Orkney had always been viable and had suffered only as a result of cash-flow problems.

“We are fortunate to continue to have a great underground orebody and the best human resources I’ve seen in the gold-mining industry,” Naude said.

The operation’s total liabilities amount to R337-million rand, Motala confirmed.

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