Name of the Project
Far West Gold Recoveries Project (formerly West Rand Tailings Retreatment Project).

Location
Gauteng, South Africa.

Client
DRDGold's acquisition of Sibanye's Far West Gold Recoveries (FWGR) assets was finalised on July 31, 2018.

Following the successful implementation of the transaction between the two companies, Sibanye-Stillwater now owns 38.05% of the issued share capital of DRDGold.

Under the terms of the transaction, entered into in November 2017, Sibanye agreed to exchange selected surface gold processing assets and tailings storage facilities (TSFs) for shares in DRDGold.

Sibanye also has an option to subscribe for further shares in DRDGold, enabling it to potentially hold up to 50.1% of DRDGold within 24 months at a 10% discount.

Project Description
The FWGR will be rolled out in a phased approach.

According to DRDGold, the first phase, including early-stage production, design and planning over a 24-month period, will involve upgrading the Driefontein 2 and 3 plants to process tailings from the Driefontein 5 dump at between 400 000 t/m and 600 000 t/m, depositing the residue on the Driefontein 4 tailings dam.

Phase 2 envisages the construction of a high-volume central processing plant capable of processing 1.2-million tonnes a month and the development of a new regional TSFs.

In this phase, reclamation will initially be from the Driefontein 3, Libanon and Kloof 1 dumps, and then from the Ventersdorp North and South dumps. The scale of the infrastructure established in this phase will allow for reclamation from other sources in the region.

As an alternative to Phase 2, or if Phase 2 is delayed, Phase 1 can be extended by blending in material from the Driefontein 3 dump. Envisaged is the treatment of 77.7-million tonnes from the Driefontein 3 and 5 dumps, and a further upgrade of the Driefontein 4 tailings dam.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
DRDGold estimates the net present value (NPV) of the entire FWGR at R2.1-billion.

The estimated NPV of the alternative option is R2.7-billion, assuming a capital outlay of R397-million in addition to the initial Phase 1 capital outlay.

Value
Phase 1 will require a “modest” upfront capital investment of R288-million.

The cost of Phase 2 will depend on its size, lining requirements and the technology used, which could be between R400-million and R800-million.

The alternative option would require a capital outlay of about R397-million.

Duration
Phase 1 is targeted for commissioning within 12 months of implementation of the acquisition.

Latest Developments
The high quality of the gold tailings retreatment infrastructure that DRDGold has acquired on the Far West Rand in partnership with Sibanye-Stillwater is enabling the company to get into production very quickly, DRDGold CEO Niél Pretorius has said.

The securing of long-lead items well in advance has enabled the company to hit the ground running, he adds.

The first gold pour is scheduled for the first quarter of next year.

DRDGold, which has its main base on the East Rand at Ergo, has been in the saddle on the Far West Rand since the start of August, increasing its accessible, on-surface gold reserves by a high 82% to nearly six-million ounces of gold, with yields expected to be 25% higher than those on the East Rand.

There is no waiting for a large and expensive tailings treatment plant and deposition facility to be built at this “nicely concentrated” Far West Rand gold recovery area, which is providing optionality at relatively modest capital cost.

The company has secured a R300-million revolving credit facility for Phase 1 and expects self-generated cash flow to help with the development of the project.

Reclamation from the Driefontein 3 and 5 tailings dams, which are referred to as the first phase of the FWGR operations, has a 12-year life.

DRDGold has also undertaken to investigate the incorporation of that footprint into a larger one, which will be the subject of a two-year study from when production begins in the first quarter of next year, and could mean a far longer life-of-mine.

“There is a 15-year model and then also an 18-year to 20-year model,” Pretorius has told Mining Weekly Online.

Although the current focus is on assets the company has acquired, many dumps in the area are not owned by DRDGold. Many of those are attractive dumps, taking in the Western Deep Levels belt and the Driefontein-Kloof belt.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
R&A Strategic Communications James Duncan on behalf of DRDGold, tel +27 11 880 3924, fax +27 11 880 or email james@rasc.co.za.