Name of the Project
TGME underground project.

Location
Mpumalanga, South Africa.

Project Owner/s
Theta Gold Mines.

Project Description
The project aims to restart historical underground gold mines in Mpumalanga, a prolific gold-mining region.

The project is targeting the Beta, Rietfontein, Frankfort and Clewer-Dukes Hill-Morgenzon (CDM) mines.

In the base case, the project has a mine life of 12.9 years, delivering production of 1.24-million ounces of contained gold over the life-of-mine (LoM)at a processing rate of 540 000 t/y to initially recover 1.08-million ounces of gold.

The project aims to produce 30 000 t a month from the Beta mine, 15 000 t a month from the Rietfontein mine, 15 000 t a month from the Frankfort mine and 10 000 t a month to 20 000 t a month near the end of the CDM mine LoM. The existing mining infrastructure will be used, with the addition of new accesses, underground development and predevelopment of the mining grids to access the planned mining areas at Beta, Frankfort and CDM.

At Rietfontein, the existing adits and underground development will be used with the addition of new development ends, a new decline and the extension of an existing decline.

The mining strategy for the underground operations is to apply mechanised longhole drilling to narrow-reef mining to selectively mine out only the reef channel, with minimal dilution at Beta, Frankfort and CDM.

Rietfontein will be mined conventionally using shrinkage stoping, with hybrid loading methods between trackless load-haul-dump and rail-bound locomotives.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
In the base case, the project has a net present value, at a 10% discount rate, of $324-million at an average $1 642/oz and an internal rate of return of 65%. Based on these figures, the project has a forecast payback period of 31 months.

Capital Expenditure
The project will require a total investment of A$232-million to bring the project into production. Phase 1 is estimated at $77-million.

Planned Start/End Date
First gold production is targeted for the second quarter 2024. Beta is scheduled as the first operation to start production, followed by Rietfontein and then the CDM and Frankfort mines, which will start production simultaneously.

Latest Developments
Theta Gold Mines has entered into a nonbinding streaming term sheet with Sprott Resources Streaming and Royalty Corporation worth A$110-million, in return for a gold stream on the TGME gold project.

The TGME stream will be a significant milestone on the path to achieving first gold production at the mine, and will cover about 90% of the TGME gold project’s first stage of $77-million peak funding requirement.

The project is expected to deliver Sprott up to 100 000 oz/y of gold over its LoM, for which Sprott will pay 10% of the gold price per ounce delivered under the stream. Theta has the option to buy back 50% of the stream, based on a pre-agreed price, following which Theta will deliver 2% of the ongoing gold production.

Prior to the initial gold delivery, Theta will pay, either in cash or shares, 9.5% a year interest to Sprott for the funds advanced.

“Once the Sprott funding is closed, the company may commit to further upgrading our ore reserve base, as well as to potentially further expand our total mineral resource . . . to increase production scale and life-of-mine from the existing Stage 1 definitive feasibility study mine schedule, hence creating ongoing significant value growth for our shareholders,” Theta executive chairperson Bill Guy has said.

An environmental-impact assessment is ongoing with the local authorities and is expected to be completed later this year, along with the final approvals for two water-use licences under application.

In September, Theta received the Atmospheric Emissions Licence from the South African Department of Forestry, Fisheries and the Environment (DFFE), and a State Forest Licence, allowing for the operation of the gold processing plant and the Frankfort mine.

Key Contracts, Suppliers and Consultants
Met63 (detailed design and costing of processing plant designed for a feed capacity of 45 000 t a month).

Contact Details for Project Information
Theta Gold Mines, tel +61 2 8046 7584 or email info@thetagoldmines.com.