IT IS ALL systems go for the construction of Gold Fields’ R660 million 40 megawatts (MW) solar plant at South Deep mine, south-west of Joburg, after it received the green light from the board, the company said yesterday.
Gold Fields said South Deep was currently finalising procurement strategies and contractor criteria for the construction of the plant, which would begin during the second quarter of 2021. The plant was expected to be commissioned during the second quarter of 2022, the company said.
Gold Fields chief executive Chris Griffith said South Deep was the first South African mine to build and operate its own solar plant of this scale. “This will ensure greater reliability of power supply and reduce the cost of electricity, which currently makes up about 13 percent of the mine’s operating costs,” said Griffith.
The group said the 40MW, which was granted a licence by the National Energy Regulator of South Africa in February, would provide 20 percent of the mine’s average power consumption. The solar plant would be constructed on the mine property, comprise 116 000 solar panels and cover 118 hectares, roughly the size of 200 soccer fields, the company said.
Gold Fields also said the use of self-generated, renewable energy would translate into savings of around R120m on the cost of electricity a year.
Mining companies have sought to invest in their own renewable energy capacity to mitigate the impact of rising electricity costs from the grid, reduce their future carbon tax liabilities and improve their environmental commitments. “Importantly, it will reduce our carbon footprint by around 100 000 tons of CO2 a year, not only enhancing the sustainability of South Deep, but also contributing to Gold Fields’ long-term commitment to carbon neutrality,” Griffith said.
Gold Fields, which also operates mines in Australia, Ghana and Chile, said during 2020, renewable electricity averaged 3 percent of the group’s electricity. It said once the South Deep project was commissioned, renewables’ contribution to the group total will rise to about 11 percent.
Gold Fields said the estimated capital investment for the plant was R660m, including contingencies and escalation which would be funded from the mine’s positive cash flows over the next two years.
Gold Fields said 240 jobs would be created during the construction phase, while a team of 12 people would be required to operate the plant once operational. As far as possible, goods and services required to build the plant will be sourced locally within South Africa.
“A broad range of stakeholders stand to benefit more from the mine’s activities. A profitable mine and a sustainable business can continue to employ and develop employees, contribute to community development, support the livelihoods of local suppliers and add to the fiscus in the form of taxes and royalties,” said Griffith.
South Deep, which is Gold Fields remaining South African mine, generated $34 million (R491.52m) net cash in 2020, more than double that generated in 2019.
Gold Fields shares fell 1.16 percent to R139.07 at the close of the JSE yesterday.
BUSINESS REPORT ONLINE