Ann: Revised DFS Provides Improved Results for WBP, page-16

West Wits revises economics at Qala Shallows


4TH AUGUST 2022

BY: ESMARIE IANNUCCI
CREAMER MEDIA SENIOR DEPUTY EDITOR: AUSTRALASIA
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KALGOORLIE (miningweekly.com) – A revised definitive feasibility study (DFS) into the Qala Shallows deposit, at the Witwatersrand Basin gold project, in South Africa, has resulted in reduced all-in sustaining costs (AISC) and higher returns.
“We took the opportunity to revisit the 2021 DFS comes at a time when we have established our underground access which has de-risked the project considerably. The revised DFS shows that even with recent inflation and increased costs, especially diesel, the optimisation of the mine plan still yielded positive results and confirms our view of having a long-term robust project,” West Wits MD Jac van Heerden said.
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“The revised DFS has set the scene for exciting developments on our Project 200, which has the stated objective to further increase production at Witwatersrand Basin project to 200 000 oz/u gold.”
The revised DFS resulted in an $52/oz reduction in AISC, which is now estimated at $1 093/oz, with a steady-state AISC of $962/oz, deceasing from the $1 145/oz and the $1 028/oz respectively in the original DFS.
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Peak stead-state production has been estimated at 55 000 oz/y over a ten-year period, with the mine to average 43 000 oz/y over its 15.7-year mine life. West Wits has reported a 19% increase, or $29-million increase in the expected pre-tax net present value, which is n ow estimated at $180-million, while the pre-tax internal rate of return has increased from 35% to 38%.
A 12 000 oz increase to the declared ore reserve now placed it at 3.2-million tonnes, grading 2.81 g/t gold for 290 000 oz of contained gold.

The revised DFS estimates peak funding of $63-million over a three-year period. West Wits noted that although the total capital required is reduced, peak funding requirements increased from the $48-million estimated in the original DFS. This is mainly due to the accelerated production build-up which requires additional mining equipment and underground development at an earlier stage of the project.
The company said that the extensive work done during the early works program would enable West Wits to accelerate its multiple project financing initiatives to completion upon securing a long-term toll treating agreement.

West Wits recently announced an equity placement facility with SBC Global Investment to provide funding of up to $75-million. The equity placement facility is not seen as the main source of funding and the company, along with the appointed corporate advisory firm, Taurum International, will continue to pursue the optimum project financing solution for the WBP’s primary funding.
The company told shareholders on Thursday that a rapid production ramp-up is now planned for the fourth quarter of 2022 as part of a formal mine plan under the revised DFS.