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Stonewall Resources to start mining in Mpumalanga in 2019

GEORGE JENKINS
Stonewall Resources expects its mineral resource to continue increasing through further reviews of other local mines in the company's portfolio

GEORGE JENKINS Stonewall Resources expects its mineral resource to continue increasing through further reviews of other local mines in the company's portfolio

29th June 2018

By: Donald Makhafola

Creamer Media Reporter

     

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Australian gold producer Stonewall Resources plans to restart gold production in the fourth quarter of 2019 at the Theta Hill and Vaalhoek mines, near the towns of Pilgrim’s Rest and Sabie respectively, in Mpumalanga.

The mines form part of Stonewall’s fully permitted Transvaal Gold Mining Estate (TGME) project, with a fully permitted plant and tailings dam.

Following small-scale production from 2011 to 2015 in Mpumalanga, the company is focusing on the planned refurbishment of the existing carbon-in-leach plant and other prospective mines in the area, such as the Rietfontein mine, to resume gold production.

Stonewall aims to create a solid production platform of more than 100 000 oz/y with first production targeted at 50 000 oz/y collectively from the TGME project, based primarily around shallow, opencut or adit-entry hard-rock mining sources.

In May, Stonewall reported that the yearly review of the group’s 2012 Joint Ore Reserves Committee- (Jorc-) compliant mineral resources had increased by 39% or by more than 1.43-million ounces in total gold mineral resources to 5.15-million ounces. The mineral resource is estimated at 34.7-million tonnes grading 4.62 g/t gold, of which 24% is measured and indicated, and 76% inferred.

This was the result of a 146% increase of about 975 000 oz in mineral resources at the Glynns-Lydenburg mine, and the inclusion of the Vaalhoek mineral resource, of about 581 000 oz.

“The largest contributors to this increase in the mineral resource category are the Vaalhoek and Glynns-Lydenburg mines, owing to the process of collating, capturing and digitising historical datasets accumulated over 130 years and re‐investigating the historical mining potential using modern geological modelling and estimation techniques,” says Stonewall Resources CEO George Jenkins.

The Vaalhoek and Glynns‐Lydenburg mines have not had a complete mineral resource estimation until now; the increase has generated improvements in resources and more confidence in the expansion programme, he adds.

The company expects its mineral resource for the entire TGME project to continue to grow once drilling at Theta Hill and DG4 has been completed and a maiden Jorc-compliant mineral resource has been estimated.

Up to three drill rigs are used at Theta Hill. Stonewall Resources deployed a reverse circulation drill rig to progress with the resource drilling at the DG4 area, says Jenkins, adding that the third rig has recently been modified to improve on the previous drilling performance to rapidly progress the development of a resource estimate on the area.

He says the drilling improvement is because of the experience gained from the previous round of reverse circulation drilling. “Drilling geology was very challenging and we had to change the drilling techniques and this will help us to get better results.”

Investment Attraction

Jenkins points out that the increase in mineral resources demonstrates that Stonewall Resources continues to grow and is gaining more interest from the market, which, in turn, will make it easier for the company to attract investment.

“Prospective investors are very interested in us, particularly when they consider our recent increase in mineral resources, as well as our independent investment research report, which demonstrates that our company is significantly undervalued from a share price perspective.”

Investors have shown increased interest when the company is moving towards low-cost, opencut mining operations in South Africa, as it presents a more viable investment opportunity, says Jenkins.

He adds that a global investment house has committed to invest A$5-million through a subscription agreement, with its shares escrowed for 12 months, to preserve its position as a cornerstone investor. This will be used for exploration expenditure and general working capital to complete the reserve drilling at the Theta Hill and Vaalhoek mines, as well as environmental and engineering studies.

Jenkins concludes that the company is now well positioned to complete reserve drilling for Theta Hill and other surrounding opencut targets, as well as feasibility studies, and secure the required funding to start gold mining and production next year.

Edited by Mia Breytenbach
Creamer Media Deputy Editor: Features

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