South Deep, the mechanised Gold Fields gold mine in western Gauteng, is putting remote loading to the test.

“We’re trialling remote loading from surface, where we have a person sitting in the control room that’s operating a loader 3 km under the ground beneath him. It’s very exciting to see that kind of technology being rolled out,” Gold Fields CEO Nick Holland said in his response on the strategy Gold Fields was adopting to bring South Deep up to speed with the company’s mines in Australia, Ghana and Peru.

The person in the control room on surface, Holland explained, can operate the loader continuously, without the loss of hours during shift changes, for example.

Responding during a conference call on the performance of the Johannesburg- and New York-listed company during the three months to March 31, Holland said remote loading from surface was just one of a multiplicity of the productivity-enhancing steps being taken at South Deep, which produced 61 000 oz at an all-in sustaining cost (AISC) of $1 227/oz.

Its performance was ahead of expectations and it generated meaningful cashflow, but it still had some way to go to outdo the group’s other operations. In Australia, Gold Fields mines produced 237 000 oz at an AISC of $876/oz. In Ghana, its mines produced 194 000 oz at an AISC of $1 105/oz. In Peru, Cerro Corona produced 62 000 oz at an AISC of $714 a gold equivalent ounce.

Last year, South Deep’s productivity rose by nearly a third and measures are now being taken to advance bulk efficiency.

“We have a strategy of looking at the whole value chain,” said Holland.

“Improving the productivity at South Deep is not just one issue because you have to open up the orebody, you have to mine it, you have to support it, you have to backfill it.

“It’s a matter of looking at how that whole mining cycle can be improved. So, we’re looking at every element and at the same time, we want to make sure that quality is maximised.

“It’s all very well moving more tonnes, but you’ve got to get the right tonnes, in the right area. So, there are many initiatives under way. I think we’re making good progress,” he said.

“As you’ve seen over last year, despite the fact that we took a third of the people out, towards the end of the year we were getting the same kind of output.

So, already last year, we saw about a 30% improvement in productivity. All the work we’re doing now on innovation technology is promising,” Holland said.

A control room on surface and sensors on underground vehicles in an area making up 20% of production are providing real-time information.

“That’s going to give us a lot of information, which we’re going to use to improve the overall cycle time of getting people to the face quicker.

“The other exciting thing is as we move more of our mining into the new mine areas that we’ve developed under our ownership over the past ten years, they’ve been properly set up so that we can do bulk, non-selective mining. In those new mine areas, we have infrastructure right there. We have bays where we can park equipment and check them quickly. We have ore passes in close proximity. We have a much better set-up than what we inherited. As we gradually move into the new mine area, we’ll find that productivity will improve as well.

“I’m pleased to say as well we’ve seen an improvement in availability of equipment, particularly drill rigs, where mean-time-before-failure has improved. We’re getting the rigs for a longer period of time and it’s taking less time to repair. We’re now rolling that out on to our trucks and our loaders.

“The team is working on multiple areas. I’m very excited about the developments and I’m sure they are going to have a positive impact on productivity and costs going forward,” said Holland

MECHANISED SKILLS

Gold Fields is sponsoring mining studies at the University of the Witwatersrand and working on the establishment of a bespoke training facility to satisfy its mechanised mining needs.

“Skills are an issue in our business particularly as mechanised mining is the future of mining in South Africa. Conventional mining, I think, is dying. Hand-held conventional mining, I think, has got really five, seven years, tops. I wouldn’t be too bold going beyond five to seven years. The youngsters just don’t want to do that stuff and mechanised mining obviously means there’s going to be a huge amount of demand for the right skills.

“We’ve realised we have to train up. We’ve realised that there aren’t enough skills in the industry and so one of the key strategies we’ve been working on is to have our own bespoke training facility where we can actually roll out mechanised miners. We continue to sponsor Wits University to make sure that we’re pushing out at least 100 mining graduates a year. I’m involved in that directly and that’s the kind of strategy, but it takes time, it’s not a one-year story,” said Holland.

“We’ve been able to withstand the early onslaught of the coronavirus pandemic reasonably well. The teams across the globe have reacted, putting people first in health and safety and we’ll continue to do that.

“At the same time, we’re very focused on ensuring that the business is sustained to make sure that when we come through this, we don’t spend 2021 or beyond getting back to where we should have been.

We’ve got the liquidity to do it. We’ve got the balance sheet to do it and bear in mind, 80% of our production is continuing with minimal interruption. That puts us in a very strong position. We look forward to giving you an update and let’s hope that the next time we talk, the world is in a better position to deal with this pandemic,” he added.

South Africa’s Petra Diamonds (LON:PDL) has swayed bondholders to receiving an interest payment due Friday to a later date, which would allow it to borrow R400 million ($21m) in new debt, a key move to keep the miner afloat.

Petra, which has been hit by a triple whammy of weak market conditions, power emergencies in the home country and now the coronavirus pandemic, said on Friday that it has been able to secure a R1 billion revolving credit facility (RCF), with conditions.

The provisions set by Absa, Nedbank and Rand Merchant Bank, demand a temporary halt to the repayment of a black economic empowerment (BEE) scheme. They have also asked for a suspension of this year’s first installment of a semi-annual 7.25% interest payment on a $650 million convertible loan note.

Failing to pay interest after a 30-day grace period allowed (May 30) could see bondholders force the redemption of their bonds with interest. Such a move could only happen if it has the support of 25% of the company’s bondholders.

Investment banks are increasingly reluctant to extend credit to diamond producers, as inventory is not being sold and defaults are possible, analysts have warned.

“We are concerned about oversupply of rough diamonds following the reopening of economies as a lot of inventory could potentially be flooded into the system and the market might not be able to absorb all of it, resulting in increased pricing pressure,” Citi said in a note Friday.

Petra Diamonds has tried to turn around its fortunes after piling up debt to expand its flagship Cullinan mine in South Africa, where the world’s largest-ever diamond was found in 1905. The renowned open-pit mine produces about a quarter of the world’s gem-quality diamonds, and the vast majority of blue stones.

Financial crunch

The company’s share price collapsed to a record low amid falling diamond prices that forced it to write down the value of its mines in September by almost $250 million.

The financial struggles prompted the miner to launch a restructuring that ended in November with a number of organizational changes, including dropping the role of chief operating officer.

The restructuring saw the company’s founder and chairman for 23 years, Adonis Pouroulis, step down in March.

Around the same time, Petra had to declare force majeure at its Williamson diamond mine in Tanzania and scaled-down operations to a minimum level in South Africa.

The decision, the company said, was based not only on poor diamond prices, but also the effect the global coronavirus lockdown has had on sales.

Petra said on Friday that salaries for its chief executive and finance director have been cut by one-third from April to June, while its non-executive directors will see 25% reduction in their pay.

It also said that its South African operations has ramped up to a 50% labour capacity, but noted that Williamson remained on care and maintenance.

Perseus Mining (TSX: PRU; ASX: PRU ) is building its second open-pit mine in Cote d’Ivoire and its third in West Africa, and expects to pour first gold in December despite the COVID-19 pandemic.

Once built, Yaoure will produce 215,000 oz. gold per year at all-in sustaining costs (AISCs)  of US$734 per oz. over the first five years of an initial 8.5 year mine life.

On a recent conference call, managing director and CEO Jeffrey Quartermaine said development work on the Yaoure mine, 40 km from the capital of Yamoussoukro, was 52% complete, with US$29 million spent on development in the first three months of the year. In total, Perseus has spent US$129 million on developing Yaoure, or 49% of the project’s total capex of US$265 million.

“This has been one of the bright lights for us this quarter, and we continue to make progress on all fronts at Yaoure,” Quartermaine told analysts and investors on the call. “Our stretch target of pouring first gold by December 2020 continues to be within our capacity, provided we don’t have any unusual delays coming out of the virus later in the year.”

Fabrication of the SAG and Ball mills is complete and the equipment was delivered to site ahead of schedule in February, while other procured items have been moving efficiently through the port of Abidjan in Cote d’Ivoire and deliveries to the site have been taking place on a regular basis, unimpeded so far by COVID-19. It has completed 39% of its tailings storage facility, construction of the main Yaoure substation is 56% complete, and access roads are being upgraded.

“The pleasing news is that, notwithstanding COVID-19, cargoes are being efficiently cleared through the port of Abidjan and transported to site without too much delay,” he noted. “Yaoure is a very important project for Perseus and does underpin our future growth, and so we’re looking forward very much to delivering further progress on that.”

In the meantime, it continues to operate its Edikan open-pit mine in Ghana, a historic heap leach mine it brought into production in 2011, and its Sissingue open-pit mine in Cote d’Ivoire, which started production in January 2018.

 

Perseus Mining’s Yaoure development site in Cote d’Ivoire. Photo Credit: Perseus Mining

Sissingue produced 19,964 oz. gold at US$685 per oz. and AISCs of US$781 per oz. during the quarter, while Edikan produced 38,019 oz. gold at US$1,090 per oz. and AISCs of US$1,242 per ounce. (The higher costs at Edikan were mainly the result of lower recovery rates due to carbonaceous materials in the ore from one of the mine’s pits.)

Perseus is also pushing ahead with exploration and has earmarked an exploration budget for the next 12 months of US$15 million this year — the bulk of which will be spent on areas around Yaoure, where management see “enormous potential to add materially to our reserve inventory there.” The balance will be spent at its two other producing mines. “We are accelerating our efforts on exploration, not only to extend the life of our existing operations but to, hopefully, also discover our next mine. We have some interesting targets.”

While supply chains remain open in Ghana and Cote d’Ivoire, the movement of local and foreign employees has been impacted by government-imposed travel restrictions, while work rosters have been extended. No cases of COVID-19 have been reported by any of the company’s employees or contractors at either of its two mines or at the Yaoure development project.

“We’re living in pretty uncertain times, and the COVID-19 pandemic is creating some serious challenges for us, but so far we’ve met these head-on, and we’re ahead of the game,” Quartermaine said on the call. “What happens from here remains to be seen, but we are confident that by remaining vigilant and being proactive, we will successfully see this crisis through.”

Quartermaine also noted that the company had offered its expat staff at Yaoure the opportunity to fly back to their countries earlier on, before the airports were closed down, but virtually all of them declined. “Almost to a man they said, ‘No way, we’re going to see this through,’” he said, while those at its operating mines also declined the offer. “Our people are there because they want to be there. By and large, the team was very determined to get through this. Now whether they have this same level of enthusiasm in another three months remains to be seen.” In the event of a medical emergency, Quartermaine added, a charter flight could be arranged.

In an email to The Northern Miner, Quartermaine explained that part of the company’s success weathering in the current public health emergency is due to the company’s seasoned management teams at each of its operations in West Africa that have successfully managed several in-country crises in recent years, including the Ebola outbreak during 2014-2016. The deadly disease provided Perseus with tested crisis management capabilities and systems that are proving useful today, he said.

 

Perseus Mining’s Edikan gold mine in Ghana. Credit: Perseus Mining.

Several of its key executives, prior to joining Perseus, had spent the Ebola crisis on the ground in Sierra Leone where infections were rife, he noted. “These guys brought a lot of first-hand knowledge and experience to the table,” he explained, “and, under my leadership, our team has designed and implemented the systems that we have deployed with success to date throughout our business.”

“They had been part of a team that operated all of the way through Ebola without losing a day of production,” Quartermaine said. “The strategy that their former employee deployed was taken and refined for our situation. This is what we refer to as our ‘Island Mode’ business model.”

Essentially, the company has divided its mine sites into three zones – green, orange and red. The green zone contains all of the equipment, activities and people required to guarantee business continuity, he explained. “Access to this zone is only possible after a period of quarantine to demonstrate that people are COVID-free,” he said. “The orange zone is a little more relaxed – this is where the actual mining takes place – and the red zone permits interface with the community.”

“On top of this, we have deployed a lot of other protocols and practices aimed at making sure our supply lines remain open and ensuring that we will be able to continue operation, even if the virus spreads into our surrounding community – which pleasingly it has not. I would like to think that we are assisting this by procuring and distributing supplies to local health centres, undertaking disinfectant spraying in villages, funding publicity programs on local radio advising people how to avoid catching and spreading the virus, etc.”

The Island Mode system has not been fully deployed at Yaoure, however, as the development site “is simply too large and involves too many people – a large proportion of whom are residents of the local area, and we simply cannot house and feed all of these people in a quarantined area even if they were willing to go in there.”

Nevertheless, Quartermaine said, the company continues to make headway at Yaoure.

“We do continue to make very good progress, however, and are on track, but we may suffer schedule disruption in the future if we are unable to bring specialist construction technicians and commissioning people to site when needed due to international and local travel restrictions. We are not at that point, and hopefully the travel restrictions will be lifted before it becomes an issue.”

Quartermaine, who joined Perseus as chief financial officer in 2010 and was appointed managing director in January 2013, also praised the governments of both Ghana and Cote d’Ivoire for acting swiftly when the dangers of the pandemic became known, noting that statistics “are remarkably low by comparison to developed countries.”

He noted that reported cases in both countries were low by comparison to many other countries. (According to the World Health Organization, Ghana had 1,671 confirmed cases and 16 deaths and Cote d’Ivoire 1,238 cases and 14 deaths as of April 30.) “Whether this is a function of low levels of testing, misdiagnosis, etc., I really don’t know,” Quartermaine said. “What is clear though is that both countries acted very promptly and very firmly as soon as the problem surfaced (which not every country in the world did, to their great regret I am sure).”

“Obviously the resources available to these countries are much lower than elsewhere, but they seem to be coping well at the moment and are getting solid support from industries such as the mining industry.”

In a powerful move to connect and protect mining assets, improve data connectivity, and save lives, Africa-focused industrial IT solutions provider Sedna has partnered with telecom infrastructure powerhouse Globalstar.

Band 53/n53 is a mid-band licensed spectrum resource that Globalstar offers to partners and customers that otherwise would not have access. Spectrum is sorely needed for progress in Africa. In line with demand for faster and more reliable speeds, the 5G variant of Globalstar’s Band 53 is known as n53.

“Demand for wireless data solutions from heavy industrial uses in mines is on the rise, but access to reliable always-on solutions is a challenge,” says Anton Fester, Sedna managing director.

“Access to reliable data and connectivity is an imperative for miners and their managers, as reliance on Wi-Fi alone is not enough, while access to spectrum is a continuous challenge. Globalstar’s terrestrial spectrum offers an immediate solution and we are delighted to be joining forces with a renowned global innovator like Globalstar to bring secure, reliable and state of the art data connectivity solutions to mines across the continent.”

He furthermore describes the deal as “an extremely important and exciting development for Africa’s mining industry.”

“The addition of n53 and 5G status ensures we are in lock-step with the latest digital advances and the Fourth Industrial Revolution as new networks around the world will be built utilising 5G’s advanced technology. There is already a lot of demand for these solutions as spectrum is also critical to the deployment of private LTE solutions on mines, which we are already rolling out.”

Band 53 offers partners secure and reliable connectivity in any environment and utilizing the band allows customers to deploy considerably less access points than when relying on Wi-Fi, leading to superior security, performance and long-term value.

Globalstar vice president of strategy Kyle Pickens says, “We are excited to be working with Sedna to bring Band 53/n53 connectivity to their mining deployments in Africa and beyond. Mining is a critical endeavour for the global economy and ever more important in many of the countries in Africa where Sedna is focused.

“The ever changing landscape make network design difficult and the environment is dangerous adding value to automation. Private wireless networks like we can deploy with Band 53/n53 are great solutions for Sedna’s business and the mining industry.”

Founded in South Africa in 2006, Sedna has rapidly expanded its solutions and innovation to serve mines globally (it has active operations on three continents) with scoping, sourcing, installing, and supporting enabling operational technology (OT) network technologies.

Sedna installed Africa’s first licensed spectrum private LTE (pLTE) network in South Africa as well Africa’s first underground leaky feeder licensed spectrum pLTE network.

“We aim to expand our solutions broadly across the continent. This will include developing adequate use cases to address customer needs. Innovations include automotive solutions through the power of AI, mobile connectivity for sensors, and geofencing for workers’ safety, among many others. The world is truly in the network, and by harnessing these innovations Africa’s heavy industries can thrive, survive and grow,” says Fester.

Sedna continues to expand its trusted partnership eco-system. Last month it strengthened its partnership with Nokia to co-operate on the technological advancement and development of Africa’s mining sector. It is now Nokia’s main system integrator for Africa in mining and other industrial applications.

“Our aim is to be a next-generation solutions provider to mines and other heavy industries across Africa. Technology has the power to ensure Africa’s growth trajectory is accelerated and with partners like Globalstar, we will continue to drive this growth with tailored, cutting edge solutions,” concludes Fester.

Judging from interactions with mining customers at Electra Mining Africa 2022, Weir Minerals Africa notes that there is a growing demand for digital integration, which provides mines with data to develop strategic improvements to their operations.

“Several customers spoke about the need for real time management of important operational parameters at their operations. Mines are moving away from human assumptions to using actual data points for tracking key indicators that make equipment reliable,” says Tiisetso Masekwameng, General Manager – Comminution at Weir Minerals Africa.

To respond to this growing need for digital solutions, Weir Minerals Africa showcased its Synertrex® intelligent platform which provides mines with insights into actual costs of running their plants, data to develop strategic improvements to mining operations and the opportunity to performance benchmark every part of their operations.

“Synertrex is a complete digital ecosystem that continually monitors equipment’s performance and integrates with customers’ distributed control systems. This means that advanced analytics are conveyed through a digital interface, making sure our customers have all the indicators delivered to their devices with accuracy and in real time, even if they aren’t at the mine” explains Masekwameng.

As part of Synertrex® condition monitoring, she adds, sensors are applied to processing equipment and the data they provide is captured and continuously analysed. Customers are therefore able to eliminate guesswork from their operations by having detailed real time insight into how their equipment is performing. Information is displayed on a simple, easy to understand dashboard which can be accessed via any device or integrated into existing operational systems. It will convey real time fact-based insights into machine performance and health, remaining useful life and other crucial operational indicators.

“As mining companies redefine their investment strategies, the Synertrex intelligent platform can help customers transform their operations. This is because it also assesses their machinery’s performance, including potential improvements, such as optimising the equipment’s energy efficiency or throughput. The Synertrex intelligent platform remotely manages maintenance from monitoring wear and tear, to scheduled servicing and repairs, to keep mining equipment at its most productive, thus ensuring maximum equipment uptime and profitable operations for mining companies,” concludes Masekwameng.

Sperrgebiet Diamond Mining (Pty) (SDM) this week confirmed a majority equity investment by Global Emerging Markets Group (GEM). The new shareholders, the company’s board and management stated they eagerly look forward to operations at SDM to restart and for the company to become a sustainable development partner to the local community, the Lüderitz economy and Namibia at large.

The diamond mine is now gearing up during the fourth quarter of 2022 to start up operations at the historic production levels under Namdeb. The immediate next aim is to double production by mid-2023 by implementing an infield pre-treatment facility as the second phase. The company is amidst an aggressive recruitment drive, aiming to employ up to 180 people by the end of 2022, with a further increase during phase two.

SDM is a Namibian company that owns a combination of four onshore and offshore diamond mining licences in the restricted diamond areas around Lüderitz. Its mainland based operation is located at Elizabeth Bay, 40km south of Lüderitz.

Among other investments, the resources division of the GEM Group holds mining and energy assets in Zimbabwe. Their vision is to expand their footprint in the southern African mining and energy sectors and the larger continent in the longer term.

Their current African investments include a majority shareholding in RioZim, which is one of the biggest gold producers in Zimbabwe. RZM Murowa, which is one of the world’s leading diamond producers, is an affiliate of RioZim.

The company also owns a base metal refinery and an energy business unit focused on generating green energy and minimising the carbon footprint of its mining operations. Through this latest acquisition, the group aims to expand its business with the newly acquired mining asset in southern Namibia.

Meanwhile, SDM acquired the mining asset from Namdeb Diamond Corporation in October 2020 and invested in the project through an environmental clean-up campaign and the care and maintenance of the existing main processing plant with the aim to recommission it.

Additional capital investment has been solicited by the shareholders, culminating in a share sale transaction between the Namibian shareholders being the founders, Lewcor Holdings, and its minority partners, David Sheehama, MSF Commercials, and the GEM Group.

“The equity transaction was well received by the government of Namibia and received approval from the Namibian Competition Commission and the minister of mines and energy. The deal was finalised on May 20, 2022, with GEM group subsidiary obtaining 78% of the shareholding and Namibian shareholders retaining 22% inclusive of an Employees Trust of 2%,” reads a statement from SDM.