Blyvoor Gold set to start construction in January

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Peter Skeat, Blyvoor Gold

Peter Skeat’s project to re-open the former Blyvooruitzicht (Blyvoor) gold mine should finally get the green light in January after a string of funding set-backs during 2017 which have delayed the start-up since May.

That was the original target set by Skeat in November 2016 but he – wisely – qualified his forecast at the time he made it stating it was “subject to no adverse political developments taking place.” The past year has been one of non-stop political set-backs for South Africa resulting in a string of investment ratings downgrades which have played havoc with Skeat’s foreign fund-raising efforts.

He told Miningmx, “ we had the funding lined up three times and then lost it three times because of the political situation in South Africa. Overseas investors that we approached typically gave us 10 out of 10 for the project but one or two out of 10 for the country risk.”

That forced a major rethink on strategy. Skeat has now approached the Industrial Development Corporation to come in as a key domestic investor providing 50% of the funds still required while he has lined up foreign investors for the balance.
He has also changed the development scope of Blyvoor Gold which had initially looked at developing two projects – one surface and one underground – in tandem.

Skeat commented, “ we have now decided to go for just one project initially and we assessed the underground mining project as being the more attractive for foreign investors.”

He added the funding required amounted to another $62m (about R800m) in addition to the R350m that has already been invested at Blyvoor. All going to plan the financing should be signed off in January after which construction will start targeting a first gold pour in October/November.

Skeat noted the production start-up could be pushed out to January/February 2019 depending on how well the mine construction goes along with the provision of infrastructure such as a new Eskom power line.

“It’s nearly all in place bar the funding. We have the mining licence. We can start operations using the old EMP (environmental management plan) while applying for a new one and we have good relationships with the local community whom we have brought on board as our BEE partner through a Trust.”

6 COMMENTS

  1. Again. Everything peachy on paper, but ……old habits die hard. Very hard. Then again, there’s one born every minute, right?😂

  2. Paper Skeat has always been good at finding opportunities, some good, some not so good, some C%$P!

    Problem is they are ALL good when he is promoting them and sucking in investors. I’m not sure his story about SA politics being the reason he has not raised funds stacks up. For a good project there is always funding. Speak to most respected mining guys and they will tell you what they think of his Blyvoor dream!

  3. Anonymous 1 has a good point. To assist in gaining a better underestanding of the project, here are some of the facts:
    1) Mining Right secured;
    2) 27 million ounces of SAMREC/JORC compliant Resources (confirmed with four recent and seperate CPR’s on the resource);
    3) Established underground infrastructure;
    4) Low tonnage target of up to 40,000 tpm set, notwithstanding that the infrastructure at No. 5 Shaft is designed for +100,000 tpm;
    5) BEE shareholding signed up for the future Black employees of the company and with the destitute Blyvooruitzicht Community;
    6) Intial 8 to 10 years of mining is above the water level;
    7) Significant South African underground Witwatersrand gold mining experience engaged to assist Peter Skeat with the feasibility assessment. Louis Lamsley, Dave Wittaker and myself have been committed for the last 15 to 18 months on this project;
    8) NI 43-101 published in November 2017 confirminhg the viability of the resource and declaring 1.5 million ounces of Mineral Reserve (first 15 years at 40,000 tpm) almost 50% of which is in the Proven Reserve Category;
    9) Significant expenditure already incurred to bring Blyvoor back into production – some R350 million – on winder electrics, security on the property, obtaining the mining right, environmental studies, commitments to the reinstallation of ESKOM power supply, cost reviews by third party consultants (three seperate reviews done, all confirming the Blyvoor inhouse cost estimates), other necessary Competent Persons Reports, site clean-up, recovery and repair of crucial elements of the surface infrasture and records, significant ongoing monthly overhead cost, etc… As anyone who has done a project like this before will know, the list of expenditure goes on and on. Importantly thiese expenditures are currently being contributed mainly by Peter Skeat with some help by way of salary sacrifice from the senior management team.

    There is much more that can be said, but I will refrain for going on and on about something that I have personally become quite passionate about!

    I guess its easy to sit under cover of anonymity and express a view, but hopefully the above list of facts will assist the readers to make a more informed decision.

    As regards the financial viability, I can only express my amazement that a quality asset such as Blyvoor was driven into liquidation.

    I am now the CEO of Blyvoor and am proud to stand up and be recognised as one of a few people who will be credited in the comming years, together with Peter Skeat, for taking a long hard look at Blyvoor and concluding that this was an asset that could simply not be overlooked. Its remaining financial capability is significant, and if approached dilligently, will not only satisfy the requirements of the investors (current and future investors), but will also assist in putting the Blyvooruitzicht community back on its feet.

    • Hi Alan – If this creates employment, especially in that region, then so much the better. We should all hope this is a raging success. Lord knows, we need a few more of them. David

  4. Since the Company can open anytime soon,what about the employees who got removed during the liquidation of the company,can they be assisted to get their jobs early and can they be refunded since they were not?

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