Johannesburg, South Africa — MININGREVIEW.COM — 25 February, 2008 – Emerging South African resources company Simmer and Jack Mines Limited (Simmers) says its Mpumalanga-based subsidiary – Transvaal Gold Mining Estates Limited (TGME) – has been granted the mining rights for the Frankfort group of farms and the heap leach operation at Elandsdrift.
Making the announcement here today, Simmers said the mining rights for these farms would be executed by the Department of Minerals and Energy (DME) on 18 March 2008, upon completion of the relevant paperwork.
“Granting of the Elandsdrift mining right is an essential first step in Simmers’ plan to revive the Pilgrim’s Rest/ Sabie goldfields,” it added. “Simmers is currently engaged in an exploration project to bring low grade surface deposits such as those at Elandsdrift to account by using heap leach technology. This mining method is used successfully by some of the largest low-cost gold mines in the world to recover gold from low-grade deposits in an environmentally responsible manner,” the statement continued.
“We’ve done the test work and we’ve found that the low grade gold from these surface oxide deposits leaches very well, yielding good recoveries. This opens up a whole new avenue of mining in this goldfield,” says Simmers chief executive Gordon Miller.
“In addition to being low-cost and low-risk, heap leach technology requires no Eskom-generated power and provides good rehabilitation prospects, compared to conventional, deep level mining,” he added. “We are working in an area that has been substantially disturbed by mining and forestry, and the heap leach option provides us with excellent rehabilitation prospects afterwards,” said Miller.
The Elandsdrift heap leach pad is a pilot project designed to confirm the metallurgical parameters of the extraction process on a 300 000 t sand dump. Recoveries are estimated at 0.76 g/t with a total production forecast of 5 852 oz (182 kg).
The Company anticipates that it will take until the end of June 2008 to complete the construction of the site and load the remaining tailings onto the pad. The leaching process is expected to begin in July 2008 with the first gold production forecast for October 2008.
“The revenue from Elandsdrift will provide necessary income during the 15 month period to acquire and commission the BIOX process, and thus facilitate the development of TGME’s extensive underground resources,” Miller continued.
In addition to the surface deposits, TGME currently has underground resources of 979 000 ounces in the measured and indicated category, of which 392 000 ounces are reserve ounces, as per a preliminary independent technical report.
Elandsdrift is one of four pilot heap leach pads that the company has planned to commission in the next three years as part of a feasibility study to confirm the potential for surface mining in the area. The other heap leach targets sites are Glynns Lydenburg in Sabie, Hermansburg and a site designated as DG 2, near Pilgrim’s Rest. A mining application for the processing of the Glynn’s Lydenburg tailings dam has already been accepted by the DME.
“Production from the four pilot heap leach pads averages just under 14 000 oz pa, based solely on what has been defined to date,” said Miller.
Simmers is still in the early stages of a large exploration project in the area that has thus far delineated 133 312 ounces of compliant heap leach resources at a cost of US$29.82/oz. “The costs to process these ounces – including capital and operating costs – are currently estimated to be US$360 /oz, he concluded.
The results of the feasibility study are scheduled for March 2009, with a pre-feasibility due out by March this year.