Central Rand Gold (CRG), the Operations Focus of the January issue has achieved total underground development for the year of 2,496 m with 372 m being reported for the month of October 2010. This will enable CRG to commence underground stoping in January 2011. The Atlas Copco Simba longhole drill rig has arrived in South Africa. On site delivery is expected in mid-December 2010. 6,809 oz have been produced in the current year to date and 2010 annual production target reduced to 9,000-11,000 oz, as a result of the delayed start to underground production (as per guidance given in October.
During September and October an evaluation exercise was undertaken to duplicate face sampling results using an underground diamond drill. To this end a 20 m long stretch of previously sampled reef development was drilled from the footwall tunnels immediately below the sampled reef at a depth of approximately 110 m below surface. Previous face sampling of the 1581 reef development returned an average grade of 16 g/t Au over 55 cm over the length of the reef development.
A conventional Kempe high torque underground diamond drill rig was used to drill 16 AX sized diamond drill holes toward the 1581 reef drive, aiming to intersect the Main Reef approximately 1 m up-dip from the reef drive. Of the 16 holes drilled, four intersected Main Reef voids, one encountered poor ground conditions and the remaining 11 holes intersected thin, but high grade Main Reef:
The average drilled grade of 13.74 g/t over 48 cm very closely approximates the face sampled grade of 16 g/t over 55 cm for the same 20metre stretch. This suggests that both techniques can be used for grade control purposes, allowing for a degree of flexibility in areas where ground conditions preclude on reef development. CRG is now exploring avenues of mechanising the diamond drill rig to match the underground mining and development cycle.
Exploration and Expansion
The company’s growth strategy initiatives remain on track and include:
- Independent Scoping studies into the feasibility of developing CMR East are currently underway and results are expected by the end of this calendar year
- CRG has also commissioned initial planning and scheduling studies to investigate the economics of the City Deep and Village Main mining projects
- Tender processes have commenced for surface diamond drilling at the new Crown Mines site. It is expected that this drilling programme will ultimately lead to an upgraded Resource Statement and allow for the development of Crown Mines as the next major CRG operation, which will enable the company to leverage its fixed cost base. Drilling is expected to begin late 2010/early 2011 and will run for most of 2011
- Studies are also underway to investigate the economic potential of subsidiary mineral assets such as the auriferous Kimberley and White Reef packages.
These largely unexploited and underexplored reefs are developed over a continuous strike distance of more than 25 km and remain a very substantial part of the CRG portfolio.
Mining
Pending receipt of the Simba (required for stoping) underground mining efforts have focused on footwall development. Monthly development with Sandvik twin-boom jumbos has continued at a good rate, with 372 m being achieved for the month of October 2010. Good progress and pre-stoping preparation have meant that the targeted 45,000 oz (annualised) production rate by year end 2013 remains on track.
Metallurgy
Gold production achieved between January 1 2010 and the end of October is 6,809 oz. Tonnes processed for the last three months remained relatively stable at around 23,000 t/month; however improvements were made on plant availability and most significantly on recovery. In October 2010, and following plant improvements the Bateman concentrator availability increased to 71%, above the YTD average of 60%.
The comminution upgrade initiated in October 2010 focuses primarily on the Bateman Concentrator with the objectives of increasing throughput to 45,000 t/month and achieving an 83% availability while eliminating stockpiles and unwanted material handling within the plant. This upgrade is in the detail design phase with long lead procurement packages being expedited to minimise any delays. Current planning schedules the upgrade to be commissioned in May 2011. CIP plant availability has been maintained on average at 85% throughout the year.
Lower than anticipated surface oxide ore grade from the newly opened surface slots eroded upside potential in September and October 2010, however, increased plant grade assays evident in early November 2010 could increase gold production above the 1,100 oz/month record if sustained to end December 2010. Anticipated annual production remains above the 9,000 oz range.
The optical ore sorter implementation has further progressed with the commencement of site infrastructure erection in October 2010. The Commodas Optical Sorter unit is expected in South Africa mid December 2010 with on site commissioning taking place in January 2011 coinciding with the ramp up of underground production which will feed this unit.
The South African Government has appointed an inter-ministerial task team to review the problem of Acid Mine Drainage (AMD) for the Greater Johannesburg Area. It is the Company’s understanding that the task team submitted a report to the Department of Water Affairs, in mid October 2010. The recommendations from the report have not been made public. The Department has announced that it will present the findings to Cabinet by mid December 2010. CRG will continue to support the interim solution, which requires the construction of a submersible pump station 400 m below surface and the refurbishment of an existing high density sludge (HDS) plant. CRG is not aware of any other solution that can halt and treat the rising water table level.
Currently the water level at the South Western Vertical Shaft, the area where the new pumping station will be situated, is at approximately 540 m below surface as compared to the approximate level of 570 m below surface in the Consolidated Main Reef area currently being mined. Furthermore the water level is currently rising at 0.3 m/day which is on the low end of the expected rate of rise of between 0.3 and 0.9 m/day.
