Johannesburg gold to be mined at $320/oz cash cost - Central Rand Gold
miningweekly.com
By: Martin Creamer
Published on 7th October 2008
JOHANNESBURG (miningweekly.com) – Johannesburg's Golden City gold would be mined at a cash cost of $320/oz within an operational paradigm that was on track to become a lowest-quartile-cash-cost producer, Central Rand Gold (CRG) CEO Greg James said on Tuesday.
James told analysts and investors that the LSE- and JSE-listed company would extract more than four million ounces of gold in seven years from Johannesburg's old Consolidated Main Reef, Langlaagte and Crown Mines alone.
The company had one of the largest proven gold resources in the world at a time of renewed focus on gold as a safe haven during the global financial crisis.
Its board included stalwarts like the former BHP Billiton Miklos Salamon, Australian Nick Farr Jones, and former Gold Fields nonexecutive director Mike McMahon.
The CRG management team, James said, had a strong track record of building large-scale mining projects, "full political and community backing" and sufficient financial resource to generate positive cash flow in late 2009.
The low anticipated cash costs would be mainly a consequence of mining at shallow depths where there were lower stress and heat levels.
Plant and backfill positioning would result in lower haulage costs and there would be no need for slimes dam management.
Stoping would represent 20% of the cash costs at $64/oz, engineering 13% at $41,60/oz, water and electricity utilities 4% at $12,80/oz, labour 41% at $131,20/oz, metallurgical processes 17% at $54,40/oz, and the remaining 5% at $16/oz, taking the total cash cost to $320/oz.
Upside potential included uranium and sulphur opportunities.
Gold production was expected to start at up to 1 500 oz/m from November 2008, rising to 100 000 oz/y in the fourth quarter of 2010.
The new 18 000-t/m concentrator would be commissioned in April 2009 and the 10 000-t/m carbon-in-leach plant in the first quarter of 2009.
Underground trial mining was under way to confirm that the drift-and-fill method of mining was practicable on the orebody, to confirm that dilution could be controlled and to confirm that the backfilling methodology was cost effective.
CRG owned new-order prospecting and mining licences over 11 tenements in southern Johannesburg, which contained 35,6-million ounces of compliant gold resources.
The company had consolidated exploration permits over 280 km2 in the "most prolific gold producing area of the world", the Central Rand goldfields, where previous production amounted to 247-million ounces at an average mining grade of 8,2 g/t of gold.
Drilling had identified the "most important and immediately available" shallow gold-mining opportunities, with nine areas warranting further assessment. |
