Engineering & Mining Journal

MAR 2013

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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REGIONAL NEWS - AFRICA De Beers Commits to New Mine Development at Venetia ter of 2013. The construction period is planned at 15 months, with first gold production anticipated during the fourth quarter of 2014. Allana Potash Project Cost Pegged at $642M Workers conduct a pre-shift inspection on an RH200 shovel at De Beers' Venetia surface diamond mine in South Africa. De Beers plans to invest about $2 billion for a new underground mine beneath the current pit. The De Beers Group announced in midFebruary 2013 that it will invest approximately R20 billion ($2 billion) to build a new underground mine beneath the currently operating open-pit Venetia diamond mine in Limpopo province, South Africa. When completed, the underground mine will extend the life of Venetia until 2042 and replace the open pit as South Africa's largest diamond mine. The announcement followed the receipt of the final outstanding regulatory clearances earlier in February. The development and build phase of the Venetia underground mine is expected to create 1,000 jobs over the next nine years while open-pit mining operations continue. Underground operations will begin production in 2021, yielding approximately 96 million carats during the life of the mine and securing more than 3,000 jobs. The project will employ semi-skilled and skilled workers drawn primarily from the region and trained for the project. The bulk of all equipment and services will be sourced in South Africa. Philippe Mellier, CEO of the De Beers Group, said, "Our investment in Venetia enables us to provide greater certainty around long-term supply for our sightholders, particularly those with manufacturing operations in South Africa. Our sightholders have significant investments in the local cutting industry, and this new underground mine will provide a large and predictable supply of rough diamonds for decades to come." 18 E&MJ; • MARCH 2013 Banfora Receives Positive Feasibility Study Gryphon Minerals, an Australian junior company headquartered in Subiaco, West Australia, has reported the results of a bankable feasibility study (BFS) that demonstrates the viability of developing its Banfora gold project in southwest Burkina Faso. The study is based on a conventional 2-million-mt/y CIL processing plant and open-pit mining operation using contractor mining, with the potential to expand to 4 million mt/y. The Banfora BFS considers initial proven and probable ore reserves of 1.05 million oz contained in 16.7 million mt grading 1.95 g/mt at variable cut-offs of 0.5 and 0.6 g/mt. The project has an estimated global resource of 4.89 million oz in 112 million mt grading 1.4 g/mt at a cutoff of 0.5 g/mt. The reserves and resources are 90% above 150 m in depth and remain open at depth and along strike, with a strong likelihood of further increases through ongoing drilling. Banfora production is estimated at 151,000 oz/y of gold at production costs of $734/oz during its first five years of operation, processing ore grading 2.38 g/mt. Capital costs to develop the project are estimated at $208 million, plus contingencies. Base case economics are based on a $1,300/oz gold price. Gryphon has initiated the Banfora project permitting process, with expectations that it will be completed by the third quar- Allana Potash has announced positive results from an independent feasibility study of its Danakhil potash solution mining project in Ethiopia. The study considers commercial operations that will produce 1 million mt/y of a standard grade muriate of potash (MOP) product from sylvinite reserves over an initial estimated operating life of 25 years. Capital expenditures to develop the Danakhil project, including production, port, logistics and contingency, are estimated at $642 million. The estimate includes all infrastructure required to operate a potash solution mine and bring the product to market, including cavern and wellfield installation, three-stage processing plant, product storage facilities, load out, trucking fleet and port storage facilities with all necessary infrastructure. Solar evaporation of Danakhil's saturated brine solution is possible due to yearround hot temperatures averaging 34°C daylong, with very little rainfall. Salts harvested from the ponds will be processed by standard flotation to create an MOP product of a grade sufficient for direct application as fertilizer or as feedstock for processed or blended fertilizers. Allana will have its own storage facility and conveyor system at the new port of Tadjourah in Djibouti. The main portion of the port, primarily the quay, ship loader, and associated infrastructure, is under construction and will be completed by the Djibouti Port Authority. Danakhil operating costs, including transportation to port and port handling, are estimated at $98.75/mt. Initial production could begin in 2015 and full production of 1 million mt/y could be achieved by the end of 2017. The Danakhil feasibility study was prepared by Ercosplan Ingenieurgesellschaft Geotechnik und Bergbau, a specialist potash engineering company headquartered in Erfurt, Germany. www.e-mj.com

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