Central Rand Gold goes back to basics

[miningmx.com] — CENTRAL Rand Gold (CRG) is to experiment with conventional mining operations after years spent implementing a highly mechanised mining system on various old mine workings near Johannesburg.

Previous management’s insistence on going the mechanised route caused major problems with the company’s “competent person’ – Australian consultants Snowden – which had a string of queries over the application of such technology to the mines CRG wanted to exploit.

The end result was an extended period of trial mining which CRG had to carry out to prove the process.

In an interim management statement released on Thursday, CRG said it is “currently engaged in discussions with a South African mining contractor to commence a three-month trial of conventional mining in our current mining area.

“The objective of the trial will be to understand whether conventional, handheld in-stope drilling can be undertaken safely, reduce dilution and improve grade selectivity. The trial is expected to commence by the end of June 2011. “

It seems some progress has been made concerning the acid water drainage issue which – more than any other factor – could sound CRG’s death knell.

According to CEO Johan du Toit, four meetings have been held with the department of water affairs (DWA) since March 29.

He said: “It must be noted though that although good progress has been made to date, until final engineering designs are available for the project the commencement date as well as at what level the water table can be stopped at unfortunately remain uncertain.

“The company therefore maintains its cautious view and will maintain its focus on the cash preservation measures.’

As part of those cash preservation measure CRG has issued Section 189 notices to its labour force regarding retrenchments.

Du Toit said: “Dependent on these operational requirements, a total reduction of up to 200 people (80%) is anticipated as the company moves into a care and maintenance phase.’

CRG wants to stop the rising water levels in the old workings beneath Johannesburg at a depth of 250m below surface, but notes the minimum level set by the DWA is at 150m below surface.

That minimum level would result in major flooding of the areas CRG had planned to mine.