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West Wits brings uranium, gold to ASX and JSE
Allan Seccombe
Posted: Tue, 14 Aug 2007
[miningmx.com] -- WEST Wits Mining, an exploration and development company, will list on the Australian and South African bourses later this year to raise capital to explore for uranium and gold as it brings a tailings treatment project on stream that could produce 2.4 million pounds of uranium.
West Wits is a joint venture between South Africa's embattled gold miner DRDGOLD and Australia's Mintails, which is primarily a tailings treatment company operating in South Africa.
West Wits was intended to be a gold producer, but management has realised the revenues it will generate from uranium extracted from dumps owned by DRDGOLD and Mintails on the West Rand of the Wits gold basin will far outweigh that for gold, said Mintails' Dick van der Walt.
Mintails, which raised A$90m earlier this year, is spending R250m to upgrade its Mogale dump treatment plant to raise capacity to
one million tonnes/month from 220,000 tonnes currently. Gold output is 2,400 oz/month and no uranium is extracted yet.
The West Rand dumps have 300 million tonnes of sand and slimes containing 21.5 million pounds of uranium and four million ounces of gold.
Van der Walt declined to give uranium and gold production forecasts for the Mogale plant treating a million tonnes per month, but he said a plan to double capacity to two million tonnes could see uranium production of 2.4 million pounds of uranium provided recoveries were above 75%. The second phase will not begin before 2009.
The first phase gold and uranium production will begin in the first half of 2008 and ramp up to full production by the end of the year.
The doubling of capacity could see a uranium plant built either at Mogale, which lies between Krugersdorp west of Johannesburg and Randfontein, or some 20km southwest, where West Wits is negotiating with the government for the
establishment of a megadump.
The decision on the location of the plant will be taken in the next month.
The megadump site is planned to store 800 million tonnes of material. This is nearly three times what West Wits will process, which opens the door for other gold producers to dump tailings at the site.
West Wits will also begin a three-year exploration programme around the defunct
DRDGOLD mine shafts of Durban Roodepoort Deep Gold Mine, Rand Leases Gold Mine and East Champ d'Or Gold Mine.
DRDGOLD South Africa CEO Neal Pretorius said the most likely operation to come into production would be the old Durban Roodepoort mine, which is flooded to within 500 metres from surface. The mine was closed in 2000 when the gold price was at R60,000/kg, half of what it is currently.
There is said to be a chunk of virgin ground near the mine, which West Wits is keen to explore.
West Wits will spend a year assessing geological data before embarking on a drilling programme. Van der Walt said the company was hoping to find unexploited uranium reefs. There are hopes enough data will be compiled to begin a feasibility study after three years. The listing will raise up to A$10m towards the exploration programme.
DRDGOLD, Mintails and Harmony Gold are to set up a not-for-profit company called the Western Basin Environmental Corporation that
will pump at least 15 megalitres of water a day from the old shafts, treat it, use it on the dump retreatment operations, clean it again before transferring it to a water management company called Western Utilities Corporation, which will sell it to industrial consumers.
One of the scenarios is that pipes are laid to the platinum mines on the Western Limb of the Bushveld Igneous Complex for water supplies to the water-hungry region.
The water in the mines is heavily polluted with uranium, iron and other heavy minerals, which have adversely affected the Krugersdorp game reserve and nearby streams, dams and wetlands.
The pumping scheme is planned to lower the water levels in the mines to a level where water no longer decants into other areas.
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