JOHANNESBURG (miningweekly.com) – The long-awaited acquisition by Trans Hex of the Namaqualand diamond mines from De Beers has become effective.
The JSE-listed Trans Hex expects to receive cash flows of R653-million over the life of Namaqualand Mines, which have a resource of between 1.6-million carats and 1.9-million carats that could be economically mined over a mine life of some 14 years.
Trans Hex, headed by CEO Llewellyn Delport, said on Wednesday that the 40% Trans Hex-owned Emerald Panther Investments 78 had acquired Namaqualand assets and liabilities from De Beers Consolidated Mines (DBCM) and that all outstanding conditions precedent had been fulfilled.
This follows Trans Hex working with DBCM to conclude an amendment to the sale agreement detailing the housing of the State’s 20% interest in Namaqualand Mines in a special purpose vehicle.
Trans Hex has the management and marketing agreement with Emerald Panther to receive fees totalling 5.5% of sales, thus increasing its effective interest in Namaqualand Mines to 52%.
The transaction’s previously approved R189-million funding from the State-owned Industrial Development Corporation (IDC), was reapplied for to provide for changes in the sale agreement.
It has been reported earlier that Emerald Panther secured a R166-million Department of Mineral Resources-approved guarantee facility from an insurance company for the Namaqualand mine’s rehabilitation liability.
During the year ended March 2014, Trans Hex’s South African operations swung to a pretax loss of R8.9-million, from a profit of R88.2-million in 2013.
The operation’s output decreased to 52 081 ct, from 67 115 ct in 2013, owing to a 14.9% decrease in volume treated as a result of the termination of joint venture contractors, a 12.4% decline in grade and a 21-day strike over pay increases by members of the National Union of Mineworkers.
Delport said at the time that Trans Hex’s South African operations were not sustainable in their current form and would either have to close or be transformed.
Trans Hex sees the already tested Nxodap operating facility, in the Reuning project area, on the Orange river, as the future of its Baken mine, which would be converted into a similar smaller fit-for-purpose operation going forward.
The diamond miner expects its total South African production for the 2015 financial year to reach 55 000 ct.
During the visit of Mining Weekly Online in 2011, DBCM was going all out to create 5 000 non-mining jobs in the area of the Namaqualand diamond mines as preparation to pass the Namaqua diamond-mining baton on to Trans Hex.
De Beers Northern Cape Heritage reported during the visit that low-interest loans were being granted to non-mining enterprises to promote job creation and that an artisan training programme was under way.
DBCM, its black economic-empowerment partner Ponahalo and fish company Irvin & Johnson are part of an abalone project and land has been awarded to three independent power producers to build wind turbines in the area, where SANParks’ Namaqua National Park and DBCM own game parks.