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Driefontein decline

The 2015 feasibility study indicated that this project had potential to extend Driefontein’s operating life from 2028 to 2042, producing an additional 2.1Moz of gold in addition to that expected from the current life-of-mine plan, following the first reef intersection and raise development from mid-2020 on 52 Level and the end of 2023 on 54 Level.

The estimated cost of the feasibility study project capital is R1,126 million in 2017 terms (R1,061 million in 2015 terms).

The feasibility study was approved by the Board for project execution in November 2015. In 2016, capital expenditure was R34 million with 370 metres developed.

For 2017, R125 million has been approved to complete 700m of development and all flat conventional mine development in preparation to hand over mining of the larger winder excavations, incline and the shaft-sinking project scope to a specialist mining contractor in 2018.

A process similar to that used at the Kloof project has been completed – specialist mining and construction contractor tenders are being adjudicated.

Improvements in the project schedule after accounting for significantly more stringent rock engineering design changes and mining extraction sequences indicate that 52 Level will be approximately nine months later than the feasibility study indicates with 54 Level 10 months ahead of schedule.

The potential to deliver robust financial returns, offsetting an increase in capital for a mining contractor to execute the project scope and develop the project, is indicated by the tendered contractor rates. A full motivation for consideration and approval of this change of scope will be considered in the third quarter of 2017. It is anticipated that contractor mobilisation would begin in October 2017 and development in January 2018.

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