Peter Skeat pushes ahead with Blyvoor Gold

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Peter Skeat, Blyvoor Gold

Mining entrepreneur Peter Skeat is pushing ahead with plans to re-open the former Blyvooruitzicht gold mine despite the recent political setbacks which have raised the cost of the project and pushed out the development timeline.
Interviewed by Miningmx in November, Skeat had flagged South Africa’s volatile political situation as a major uncertainty which could cause problems. He commented at the time he was looking to have the funding for the mine in place by May “but that is, of course, subject to no adverse political developments taking place.”
The “adverse political developments” of the past month involving the removal of finance minister Pravin Gordhan and the subsequent downgrading of South Africa to junk status by two major ratings agencies have pushed back Skeat’s estimate on when construction will start from June to “by September”.
The capital cost of the project has also been revised from the previous estimate of $70m to “between $80m and $85m”. Skeat said the revised figure included some cost escalation but the bulk of the increase could be attributed to the political setbacks..
Skeat is the major shareholder in the project – called Blyvooruitzicht Gold (Blyvoor Gold) – which is an unlisted company. He is proposing to resurrect the mine through two projects – the first to treat surface tailings dumps containing an estimated 1.3m oz of gold – and the second to re-start underground mining operations at an initial rate of 50,000oz of gold annually rising to 100,000oz annually after three years.
The Blyvoor mine has a chequered history in that former owners DRDGold sold it to Bernard Swanepoel’s Village Main Reef in 2011 but Village stopped mining operations and put Blyvoor into provisional liquidation in July 2013.
The mine was subsequently invaded by illegal miners who did major damage to the surface plant but were not able to get into the underground workings at the No 5 shaft where the new underground project will be developed.
The development had already been put back because of delays in getting the mining right granted which Skeat previously said he had been assured would be received by the end of December. He says the mining right has now been granted although the company has still not formally received it.
Skeat commented, “the minister has signed all the necessary approvals. The legal paperwork is still being processed through the Mining Titles office to complete the registration process. The remaining process is administrative as opposed to getting the approval itself.”
Skeat is looking to raise the finance required both directly with funders and through Cape Town institution Cadiz Corporate Solutions but he won’t provide details at this stage citing the tricky political situation.
He commented, “ we have had interest shown from ten potential backers from which a short-list of three has been drawn up but these investors have to get their damage control measures regarding their own shareholders in place given the developments in South Africa which have increased the due diligence burden.”

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