New R1.7bn Gauteng fluorspar mine to rank in bottom cost quartile

28th July 2017 By: Mia Breytenbach - Creamer Media Deputy Editor: Features

New R1.7bn Gauteng fluorspar mine  to rank in bottom cost quartile

PRODUCTION VOLUME Nokeng’s orebody comprises a 12.2-million-tonne reserve, with the mine to produce an average run-of-mine feed rate of 630 000 t/y
Photo by: Duane Daws

The new R1.7-billion Nokeng fluorspar mine, near Rust de Winter, in Gauteng, which started development last month, is expected to be a leading fluorspar producer in terms of production volume and quality and rank “in the bottom cost quartile when it reaches full production in 24 months”, says SepFluor CEO Rob Wagner.

Nokeng’s orebody comprises a 12.2-million- tonne reserve that is compliant with the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves.

“This is large when compared with others associated with new fluorspar projects around the world,” Wagner noted at a media briefing in Johannsburg earlier this month.

Life-of-Mine

The openpit fluorspar mine and concentrator are being developed by Nokeng Fluorspar Mine, a wholly owned subsidiary of SepFluor. The mine’s estimated life-of-mine (LoM) is 19 years and it will have an average run-of-mine feed rate of 630 000 t/y.

The concentrator will produce up to 180 000 t/y of acid-grade fluorspar, and up to 30 000 t/y of metallurgical-grade fluorspar for the global markets.

Nokeng will mine two deposits, Plattekop and Outwash Fan, with a third deposit, Wilton, yet to be explored, possibly extending the LoM.

Wagner added that the grade of Nokeng’s ore – at an average of about 27% calcium fluoride – was considered high, which would ensure sound economics and locked-in markets.

Meanwhile, Nokeng presold 40% of its early production, “at today’s prices”, to several international fluorspar users for the first three years of production. Most of the material will be exported to the US and Europe, with the balance to be sold to an open market.

“We are in a position to participate in any market upturn in the first three years of production and we are open to the market beyond the first three years,” he said.

Marketing and Distribution

Moreover, a long-term agreement has been concluded with financial solutions pro- vider Traxys, which has a significant pre- sence in South Africa, for the marketing and distribution of Nokeng’s production.

Wagner highlighted the ease with which Nokeng’s surface and near-surface orebody could be mined, as well as the efficiency of the new concentrator plant, as key factors that would help position the operation in the bottom costquartile of producers.

Earthworks and civils for the mine and concentrator are expected to start next month, with first production expected by the first quarter of 2019.

The company aims to complete construction of the process plant by October 2018, with final handover of the process plant expected in February 2019.

Fixed-Term Jobs

According to Wagner, Nokeng is the first new mine to be built in Gauteng in 12 years, and is expected to create about 300 fixed- term jobs during construction and about 200 permanent jobs after construction.

In addition, Nokeng’s social and labour plan has committed about R26-million, including a R10-million education and training centre that will be built in early 2018, to serve the needs of the surrounding community. The centre will be modelled on the training facility of manganese miner United Manganese of Kalahari, at Kuruman, in the Northern Cape.

Funding for the mine comprises equity and debt, and involves local and overseas investors and lenders.

Wagner highlighted that, while funding was finalised ahead of the June announcement of South Africa’s new Mining Charter, the company was evaluating the potential impacts of the charter, should there be no change following the challenges in the wake of its contested gazetting.

“However, our priority is to expedite mine development and production, on time and within budget,” he concluded.