JOHANNESBURG - Mining company Northam Platinum said on Wedneday operations at the Kukama shaft situated at its Eland mine complex would recommence in the new financial year after the successful conclusion of a feasibility study for the project.
Northam purchased a 100 percent interest in the Eland mine situated in Brits in North West province from Glencore Operations South Africa in 2017 for R175 million.
Eland mine, situated on the south-eastern limit of the western limb of the Bushveld Complex, was placed on care and maintenance in 2015 and Northam continued to manage it as such whilst undertaking the feasibility study for the Kukama shaft.
Eland has a 19.3 million-ounce rhodium-rich resource and developed surface infrastructure.
Northam forecasts investment returns comfortably in excess of its current weighted average cost of capital, with positive free cash flow generated from the fourth year onwards and the creation of 2,800 permanent jobs as the life of mine is in excess of 30 years.
Whilst completing the feasibility study for Kukama and following positive feedback, Northam commenced early work in preparation for its recommissioning, which included refurbishing underground fixed and mobile equipment as well as sections of the concentrator.
It also commenced processing of the tailings storage facility at the Eland mine.
Northam said the next step was the conversion of the Kukama decline shaft into a footwall array that would start in the 2020 financial year, along with limited early stoping. Strike development and stoping build-up is scheduled to commence in the 2021 financial year.
Production is forecast to reach 100,000 ounces per annum by 2025 and steady state production of 150,000 per annum is forecast from 2029.
Total developmental capital expenditure is estimated at R2.2 billion over a five-year period, which includes a provision for working capital requirements during the development phase. The project will be fully funded from Northam’s own resources.
Northam chief executive Paul Dunne said the project further diversified the group’s operations and production capacity by utilising an extensive existing capital footprint.
"Kukama is a project that lends itself to scaling up or down and will form the production base for the broader Eland complex," he said.
"The mining method to be implemented at Kukama is well-known and well proven. Our focus will be on safe, quality, long-life production, whilst creating sustainable long-term employment in the platinum industry."
- African News Agency (ANA)