Simmers chief executive officer Gordon Miller has announced that the company’s Buffelsfontein mine – in conjunction with First Uranium Corporation – has commissioned an initial technical assessment to investigate the deepening of Buffelsfontein’s Strathmore Shaft. The shaft is located on the down dip southern-most extent of the mine, approximately 2 km south-east of its number 10 shaft, near Klerksdorp in North West province.
The initial technical assessment (ITA) is already underway, and it is anticipated that Simmers will be able to report on the findings by the end of 2007. Subject to the results, a further feasibility will be commissioned.
Questioned on a definitive time plan to move through a full feasibility to an eventual decision to go ahead with the project, plus production targets and estimated costs, senior Simmers spokesmen were not willing to commit to specifics. They made the point that it was too early to make any predictions at this stage, and undertook to announce details as soon as they were able – almost definitely not before completion of the feasibility study towards the end of 2008.
The Strathmore shaft deepening project is part of Simmers’ bid to continue converting its substantial resources to reserves. Buffelsfontein Gold Mine is a wholly-owned subsidiary of Simmer and Jack, which in turn has a 65.49% stake in First Uranium Corporation.
SECOND BUFFELSFONTEIN PROJECT
The new project comes in the wake of the re-opening of the high-grade Number Five Shaft at Buffelsfontein at a cost of R170 million. The shaft was damaged by a seismic event in early 2005, but after conducting risk assessments and reviewing the reserve/resource situation, Simmers went ahead and raised the capital needed to repair the shaft and will be back in production by the first quarter of 2008.
Number Five Shaft is expected to deliver 12 000 ounces by March 2008 at a cash cost of US$378 per ounce. Its resource base features measured and indicated resources of more than 11 million ounces, coupled with excellent conversion potential.
This project is expected to extend life of mine, which currently stands at 20 years. The re-opening of Five Shaft will result in a 5% increase in the overall life of mine grade; an improvement in peak production forecast to 318 000 ounces by 2014/15; and a 12.5% increase in total life of mine ounces from 4.5 million to 5.1 million.
“While we continue on plan and on budget with the development of First Uranium’s Buffelsfontein uranium and gold tailings recovery project – and are proceeding with the opening up programme at Buffelsfontein gold mine – we believe we have significant opportunities on this site to grow beyond those projects, and we are actively exploring the possibilities,” Miller contends. “At current gold and uranium prices the rock value should be significant, which enhances the potential viability of the Strathmore project. In the event that it does prove viable, it has the potential to boost Simmers’ proven and probable resources by up to 50%,” he points out.
SIMMERS REVIEWING EARLIER STUDY
During May 1989, the mine’s previous owners, Genmin, completed a full, stand-alone concept study and capital cost estimate of the Strathmore project. Now Simmers has commissioned an independent study to review the 1989 study using current cost and gold price assumptions.
As part of the 1989 study, eight diamond core holes were drilled, of which seven intersected the Vaal Reef. Deflection holes drilled from the seven holes resulted in a further 35 reef intersections. The mineable area is estimated to be 2.7 million m2 with reef at depths of between 3 500 and 4 100 m having an average dip of 28 degrees.
The 1989 study estimated the expected average gold grade at 1.297 cm g/t with an expected yield of 7.3 g/t. The area under consideration is approximately 1 000 m deeper than the workings and infrastructure of the Buffelsfontein mine. To unlock the value of this project, it would therefore require the deepening of the Strathmore Shaft by that additional 1 000 m to drop it down in excess of four kilometres.
“The Vaal Reef is the dominant reef mined in the Klerkdorp goldfields and contains attractive uranium values to the order of 0.60 kilograms per tonne,” reveals Jim Fisher, executive vice president and chief operating officer of First Uranium. “It was displaced by the Jersey fault, which cuts across the Klerksdorp gold field and impacts similarly on the down dip extension of AngloGold Ashanti’s Great Noligwa mine, west of Buffelsfontein,” he adds, “and AngloGold has developed its Moab Khotsong mine in the same displaced down dip extension of the Vaal Reef.”
Simmers is a leveraged gold and uranium company with a diverse range of projects encompassing deep level pillar mining, shallow, low-cost mining and surface operations. A development company with the aim of becoming a tier one, low-cost gold and uranium producer, Simmers is focused on sustainable expansion through the organic growth of its large resource base, coupled with a targeted exploration programme.