West Wits expects updates to the Witwatersrand Definitive Feasibility Study to provide a material improvement in the South African project’s production and economic outcomes.
The updating of the DFS by Bara Consulting will include new information gained from underground survey works, optimisations of the mine plan and updated market assumptions with results expected in July.
Given that the Witwatersrand project already boosts a resource of 4.28Moz grading 4.58 grams per tonne (g/t) gold with attractive economics, a material improvement is likely to be a real sight to behold.
West Wits Mining (ASX:WWI)has also received Environmental Authorisation approval from South Africa’s Department of Mineral Resources & Energy for the prospecting right following completion of the 30-day community consultation period.
This will reintroduce areas reported under the project’s previous Prospecting Rights which were removed upon granting of the Mining Right which has a reduced tenement footprint.
As such, the project is expected to see a material increase to its current gold resource.
“The company continues to progress initiatives to optimise and grow the WBP whilst advancing discussions with potential funders,” chairman Michael Quinert said.
“The underground survey work, optimisation of the mine plan and anticipated granting of the Prospecting Right application are expected to have a material impact on the WBP’s resource and production metrics.
“Coupled with the favourable movements in gold price and exchange rate, the quality of the asset continues to improve.”
Qala Shallows update
West Wits noted that the ability to access underground via the refurbished decline shaft atQala Shallowshas allowed its technical team to undertake detailed measurements of the ore body characteristics, including reef dip and widths.
This information enhanced the data set for the area to be mined over the early years of the project and enabled further refinement and optimisation of the mine plan.
Importantly, the team has identified potential opportunities for improving economic outcomes at Qala Shallows, which will be combined with changes to the gold price and exchange rates in the updated DFS.
Seeing as the DFS had previously estimated pre-tax Net Present Value and Internal Rate of Return, both measures of profitability, at US$180m and 38% respectively using a gold price of US$1,750/oz and an exchange rate of ZAR15/USD, this is likely substantial given that gold is trading well past the US$1,900/oz mark while the rate is now ZAR18.2/USD.
West Wits has also progressed discussions with several prospective funders to secure the optimum funding solution for the project and is confident of securing commitments to finance the re-commencement of operations in the near-term.
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