The exciting new South African gold-mining technology that has the potential to change the face of South Africa’s struggling precious metals mining business has produced its first gold.

AngloGold Ashanti, South Africa’s biggest gold mining company, which produced this pioneering gold at its TauTona gold mine, intends going operational on a second site in April and a third site in July.

“I want to point out that this is not mechanisation,” AngloGold Ashanti CEO Srinivasan Venkatakrishnan (Venkat) told Mining Weekly at a media roundtable last week, when the company posted a strong set of third-quarter (Q3) results, which saw earnings rise on a 12% production increase and a 10% drop in total cash costs, compared with the previous quarter.

The JSE- and NYSE-listed company’s Q3 performance, which drew considerable praise from gold analysts, saw the share price lift by more than 6% to R158-plus per share in Johannesburg last week.

The reef-boring technology, which Venkat described as AngloGold Ashanti’s biggest single lever in the South African region, involves drilling a hole through the reef and extracting “all the gold, only the gold, all the time, safely”.

No gold is left behind because of the elimination of the need for pillars as a result of backfilling.

In the absence of drilling and blasting, there is no seismic shake-up.

AngloGold Ashanti COO Mike O’Hare flashed a picture onto a large screen, which showed a 30-m-long hole at a 27° dip, which was a perfect takeout of the gold reef.

“Every drop of water and every grain of rock that comes out of that hole are properly captured so we should not be talking to a mine call factor issue with this kind of mining,” O’ Hare told the presentation audience, which included Mining Weeky.

The picture showed the vast quantity of waste that would no longer be brought to surface.

Steps were now being taken to get the process to operate 24 hours a day, 365 days a year.

Hole number 15 just completed was drilled in a record 3.2 days using a purpose-designed 660 mm drill bit.

The target is to do that in two days to put it on a par with conventional mining systems.

The next key focus will be to drill the holes ever closer to test whether the backfill is as strong as the reef removed, and holes are currently at less than a metre apart.

“We’ve actually mined 35 kg of gold out of a shaft pillar area that we abandoned because of the danger we were experiencing using conventional mining,” O’Hare added.

The new technology opens up areas left unmined on current mine sites, shaft pillar areas and ultradeep mining.

AngloGold Ashanti’s South African gold reserves will double with its introduction; if it is left unintroduced, labour levels will fall.

“Importantly, it provides productivity, which enables us to address a number of issues that the industry currently faces,” Venkat reiterated to Mining Weekly.

The pace of introduction of the new technology, which is expected to produce 10% to 20% of AngloGold Ashanti’s South African production base in the medium term, will continue to be ramped up.

“We’ve got to get this to work to economies of scale and then we will have transformed the landscape in the mining sector completely,” Venkat told Mining Weekly.

A number of gold and platinum miners who also want to make use of the South African technology have already approached AngloGold Ashanti – the technology has to be adapted to fit specific orebody depth and width.

“We’ve not sought to keep this to ourselves. We’re looking at the greater good of South Africa,” Venkat commented to Mining Weekly.

At the end of the day, AngloGold Ashanti, which has been putting time and energy into developing the technology, will have an early-start advantage on the rest of the industry.