GOLDEN OPPORTUNITY
A revival of part of the liquidated Blyvooruitzicht gold mine is under way that, if successful, will re-employ some of those who lost jobs in 2013 and help tackle a major source of crime and pollution
Mining entrepreneur Peter Skeat is continuing to drive the partial revival of the bankrupt Blyvooruitzicht gold mine near Carletonville, where 1,700 miners lost their jobs when the company collapsed five years ago because of a weak gold price.
Skeat’s Blyvoor Gold Capital is finalising funding and the last regulatory approvals that are needed to resume underground mining at a single shaft — number five — and to treat gold remaining in old tailings storage facilities. The mine will operate two metallurgical plants, one for underground ore and the other for tailings material.
If everything goes smoothly, the mine will employ 800-900 people and operate for another 30 years.
Skeat has been working on these plans since 2016. Mining veterans who recall Skeat’s history of disputes with his partners will not be surprised to hear that Blyvoor has hit a few bumps already. His relationship with his first co-directors at Blyvoor ended up in court.
The company’s CEO is now Alan Smith, who was previously CEO of Sephaku Fluoride after spending 27 years at various companies in the Anglo American group. He says about R350m has been spent on the mine to date and progress is being made on raising the other US$62M needed.
“We are working on term sheets, and due diligences are under way,” he says.
The project timeline is 18 months from securing funding to pouring the first gold from underground.
When Blyvooruitzicht suspended operations in August 2013 there were about 6,000 people living in neat little mine houses, as well as two schools and a crèche. But with no money coming in, those who remained were unable to pay electricity and water bills, so services were discontinued. Illegal miners, or zama zamas, overran the mine, scavengers stripped everything of value and crime soared.
Smith says some illegal mining still takes place on the periphery of the dumps, but the tight security around Blyvoor Gold’s operations has been very effective.
As far as the villagers are concerned, there is an agreement with the municipality to continue supplying water and electricity. However, when there are problems with water or electricity infrastructure, Blyvoor Gold will help address them.
Blyvoor Gold’s relationship with the local community is good, and it has a blackownership structure that will benefit its employees and ultimately the community by funding community-related projects, Smith says.
According to the background-information documents prepared by Digby Wells Environmental for Blyvoor’s air emissions licence and the environmental authorisation application for the two metallurgical plants, no new infrastructure will be built, but existing infrastructure will be refurbished.
A public meeting in Carletonville was set for February 21 as part of the process.
According to the documents, Blyvoor has an estimated underground resource of about 169 Mt of ore containing 26.4m oz of gold at an average grade of 4.85 g/t. Initial production will be about 30,000 t/month, rising to 40,000 t/month with a recovered grade of more than 10 g/t.
Underground mining can be carried out for about nine years above the 29 level before dewatering will be necessary to mine deeper. About 18m oz of gold are accessible above the water level.
Projected employment in the first five years will be about 730 people, 70% of whom will be from Merafong municipality, according to the social and labour plan.
After five years, 842 jobs are envisaged.
Latest available data shows that just under half of the population of Merafong is employed. About 17% are described as “unemployed” and 33% as “inactive”.
Digby Wells says Blyvoor Gold’s operations will also remove sources of windblown dust and water pollution emanating from the tailings.
Mariette Liefferink of the Federation for a Sustainable Environment (FSE), a nongovernmental organisation that has spent years challenging the environmental devastation from careless mining, says the FSE is not opposed to the reclamation of Blyvoor, as long as it is done in a responsible and sustainable manner. It would address the social and environmental problems that have resulted from the closing of the mine.
The FSE is heartened that Blyvoor has about R140m to spend on rehabilitation.
Unfortunately, the organisation has had problems with this process. Its expert submission as part of the environmental impact assessment conducted last year — which cost the organisation R90,000 and identified various areas of concern — was not included in the final report. The FSE discovered only afterwards that the environmental management plan was approved without its input.
After the FSE protested, pointing out that if it filed an appeal it would delay Blyvoor’s plans to resume mining, Digby Wells undertook to include the organisation’s expert submission as part of the public consultation process for the environmental authorisation.
What it means: Once reopened, Blyvooruitzicht gold mine is expected to employ about 900 people and operate for 30 years