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Witwatersrand basin project – Qala Shallows Phase 1, South Africa – update

Location map of the Witwatersrand basin project

Photo by West Wits Mining

10th May 2024

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

     

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Name of the Project
Witwatersrand basin project (WBP) – Qala Shallows Phase 1.

Location
At the northern edge of the Witwatersrand basin, in the Central Rand goldfield, south-west of the City of Johannesburg, in Gauteng, South Africa.

Project Owner/s
West Wits Mining.

Project Description
Qala Shallows forms part of the WBP.

The updated results of the definitive feasibility study (DFS) have further enhanced the project’s promising outlook. The project has contained ore estimated at 1.01-million ounces.

The two Kimberley reefs – K9A and K9B – will be processed during the life of the project.

The Kimberley reef ore produced will be treated at an existing nearby plant on a toll treatment basis. A toll treatment agreement has been signed with the Ezulwini process plant facility and all ore produced will be truck-hauled to this plant, which uses the carbon-in-pulp process for gold recovery.

The updated DFS envisages production of 10.1-million run-of-mine tonnes, compared with 7.6-million in the DFS. Maximum production has increased from 699 000 t/y in the DFS to 839 000 t/y in the updated DFS, for overall production of 924 000 oz from 688 000 oz.

Steady-state production is estimated at 70 000 oz/y.

The mining method has been left unchanged from that used in the 2022 DFS. The only difference between the mining plans pertains to mining sequence and timing.

The updated DFS has determined that conventional breast mining in an underhand configuration is the optimal method for the deposit.

Life-of-mine (LoM), from construction to relinquishment, has increased from 15.7 years to 17.7 years.

Potential Job Creation
The project is expected to generate about 1 000 jobs over 18 years.

Net Present Value/Internal Rate of Return
The updated DFS has a pretax net present value (NPV), at a 7.5% discount rate, of $367-million and an internal rate of return (IRR) of 38%, with a payback of five years, compared with an NPV of $180-million and a payback of 4.1 years, in the August 2022 DFS. The IRR remains the same.

Capital Expenditure
Peak funding has decreased from $63-million in the August 2022 DFS to $54-million in the June 2023 updated DFS.

Planned Start/End Date
Phase 1 is expected to be completed in 2026.

Latest Developments
To strengthen its balance sheet and fund its ongoing operations, West Wits Mining has secured firm commitments from unrelated existing and new sophisticated and professional investors to raise A$1.4-million, before costs, through a share placement.

It intends to issue about 107.69-million fully paid ordinary shares at A$0.013 a piece.

The proceeds will be used for site maintenance, engineering and production planning at its Qala Shallows project, as well as for project finance activities, including due diligence, and to meet general corporate and working capital requirements.

Key Contracts, Suppliers and Consultants
Calgro M3 (secure potable water supply for the mine); and Modi Mining (labour and skills).

Contact Details for Project Information
West Wits Mining, tel +61 3 8692 9049 or email info@westwitsmining.com.

Edited by Creamer Media Reporter

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