Gold miner announces first uranium reserve

4th April 2014

By: David Oliveira

Creamer Media Staff Writer


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JSE- and NYSE-listed gold mining company Sibanye Gold has announced a total uranium mineral resource of 418.5-million tons, containing 68.8-million pounds of ura- nium, with a mineral reserve of 406-million tons containing 43.2-million pounds of uranium.

The results, published in February, reflect the mineral resources and reserves at Sibanye’s Beatrix West Section – previously Oryx – on the Beisa reef, in the Free State, as well as at its West Rand Tailings Retreatment project, as at December 31, 2013.

“As a result of the fire that broke out at [the] Beatrix West Section of the Beatrix operation in February last year, which impacted on a large part of the gold production area, the econo- mic viability of the shaft came into question. This resulted in Sibanye restructuring the shaft, which halted a large portion of its development,” says Sibanye corporate affairs head James Wellsted.

He adds that Sibanye is reconsidering the potential of uranium mining at the Beisa reef at Beatrix West Section, as the infrastructure to do so is in place.

The company is still conducting prefeasibility studies and due diligence for uranium mining at its Beatrix operation, which will take up to three years to conclude.

“The inferred economic returns from these studies will determine whether Sibanye will construct a uranium plant near its Beatrix operation or whether it will construct a concentrator and ship all the uranium to be processed at the Cooke 4 Ezulwini plant in the West Rand,” explains Wellsted.

Sibanye announced in August 2013 that it would acquire midtier mining group Gold One’s Gauteng-based Cooke operation, which has uranium production assets such as the Cooke 4 treatment plant. This acquisition will put the company in a position to begin uran-ium extraction.

As a result of this transaction, Sibanye is also acquiring all of the underground and surface operations at Cooke, including the dumps. Sibanye is issuing Gold One with about 150-million shares, which constitutes about 17% of the company.

Wellsted notes that, prior to the Cooke acquisition, Sibanye did not have the necessary processing infrastructure to extract uranium, despite the presence of uranium resources at its various mine dumps. The company is investigating the possible returns on a high-volume dump retreatment plant as part of the West Rand Tailings Retreatment project. “This is partly the reason why the com- pany made the offer for the Cooke assets. The existing Cooke 4 plant will allow us to accelerate the extraction of uranium from the dumps and hence the project.

“In the past, uranium mined would be dumped with slimes into tailings dams. However, as part of the company’s tailing retreatment programme, both gold and uranium will be extrac- ted from the tailings facilities and depo- sited into a single, more inert and environment- friendly tailings area,” Wellsted says, adding that retreating the tailings will help Sibanye to reduce future environmental liability issues.

Beatrix: A History
“Uranium is closely associated with gold in the Witwatersrand basin, and AngloGold Ashanti is currently the only gold company operating in South Africa that is producing uranium as a by-product,” says Wellsted.

“Most gold mining companies decommissioned their uranium plants after the uran- ium price declined in the late 1970s and early 1980s,” he adds.

The Beatrix West Section of Sibanye’s Beatrix operation was originally developed by mining house Gencor – which later merged its gold operations with Gold Fields of South Africa to form the gold major Gold Fields – as a uranium mine, the Beisa mine, in 1981.

“Subsequent to the collapse of the uranium price, following the Three Mile Island partial nuclear meltdown, in the US, in 1979, Gencor closed the Beisa mine in 1984,” Wellsted highlights.

He adds that Gencor extended the mine shaft to extract gold from the deeper Kalkoenkrans reef and renamed it the Oryx gold mine, which started producing gold in 1993.

The gold mine was renamed Beatrix West Section, following the merger of the Beatrix and Oryx mines in 2002.

Edited by Samantha Herbst
Creamer Media Deputy Editor



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