REG-Pan African Resources PLC: 2016 Abridged Mineral Resource & Mineral Reserve Report <Origin Href="QuoteRef">PAFR.L</Origin>
21/09/2016 07:05
Pan African Resources PLC
(Incorporated and registered in England and Wales under Companies Act 1985
with registered number 3937466 on 25 February 2000)
Share code on AIM: PAF
Share code on JSE: PAN
ISIN: GB0004300496
("Pan African Resources" or the "Company" or the "Group")
2016 Abridged Mineral Resource & Mineral Reserve Report
Pan African Resources, the African-focused precious metals producer, is
pleased to announce that the 2016 Abridged Mineral Resource and Mineral
Reserve Report ("MR&MR") has been released and is available on the Company's
website at www.panafricanresources.com. A summary of the report, including the
Group Mineral Resource and Mineral Reserve statement as at 30 June 2016, has
been provided below.
Overview
* 3.0 million ounces (“Moz”) or 9.4% gross annual increase in Group gold
resources to 34.9Moz (2015: 31.9Moz).
* 0.4Moz or 3.8% gross annual decrease in Group gold reserves to 10.0Moz
(2015: 10.4Moz).
* No material change in Group platinum group elements (“PGE”) resource,
0.6Moz (2015: 0.6Moz).
* 0.3 Moz or 60% gross annual decrease in Group PGE reserves to 0.2Moz (2015:
0.5Moz). Following International Ferro Metals Limited (“IFM”) being placed
in business rescue, the PGE mineral reserves at Phoenix Platinum declined
year-on-year by 0.3Moz.
* 23.3 million tonnes (“Mt”) of mineable tonnage in situ coal from
Uitkomst Colliery.
* Down dip extension of the high grade 11 Block of the main reef complex
(“MRC”) orebody by a further 70 metres. This extension to the MRC orebody
resulted in additional mineral reserves at Fairview Mine, thereby extending
the life-of-mine (“LOM”) of Barberton Mines to 22 years.
* Positive grade/tonnage profile for the 25-26 levels at Evander No. 8 Shaft,
thereby maintaining the LOM of Evander Mines to 16 years.
* Surface exploration drilling commenced at Evander Mines targeting the 2010
payshoot.
* Positive pre-feasibility study (“PFS”) of the Elikhulu tailings
retreatment project (“Elikhulu Project”), the Company mandated DRA
Projects (Pty) Limited (“DRA Projects”) to conduct a definitive
feasibility study (“DFS”) on the project. This study will be completed by
November 2016.
Gold
Group Gold Mineral Resources
The Group's attributable gold Mineral Resources increased from 31.9Moz in June
2015 to 34.9Moz in June 2016, equating to an annual increase of 3.0Moz, or
9.4%. This increase can be attributed to additional resources estimated for
the Elikhulu Project at Evander Mines and a higher gold price used for the
declaration of the Group’s gold Mineral Resource.
As at 30 June 2016
Tonnes Grade Contained Gold
Category (million) (g/t) Tonnes Moz
Mineral Resource Measured 6.6 10.27 67.8 2.2
Indicated 261.3 2.42 633.5 20.4
Inferred 69.4 5.56 386.0 12.3
Pan African Resources Total 337.3 3.22 1 087.3 34.9
Group Gold Mineral Reserves
The Group's gold attributable Mineral Reserves decreased from 10.4Moz in June
2015 to 10.0Moz in June 2016 - an annual decrease of 0.4Moz, or 3.8%.
As at 30 June 2016
Tonnes Grade Contained Gold
Category (million) (g/t) Tonnes Moz
Mineral Reserve Proved 5.0 7.78 38.8 1.3
Probable 77.3 3.51 271.8 8.7
Pan African Resources Total 82.3 3.71 310.6 10.0
The decrease in the Group’s gold Mineral Reserve can be attributed to mining
depletion for the year under review.
Platinum Group Elements
Group PGE Mineral Resources
The Group's attributable PGE Mineral Resources did not change materially for
the year under review.
As at 30 June 2016
Tonnes Grade Contained PGE’s
Category (million) (g/t) Tonnes Moz
Mineral Resource Measured 1.4 2.43 3.4 0.1
Indicated 1.3 2.65 3.4 0.1
Inferred 3.5 3.65 12.6 0.4
Pan African Resources Total 6.2 3.16 19.0 0.6
Group PGE Mineral Reserves
The Group's attributable PGE Mineral Reserves decreased from 0.5Moz in June
2015 to 0.2Moz in June 2016 - an annual decrease of 0.3Moz or 60%. This
decrease is attributed to the exclusion of the mineral reserves from the
Lesedi Mine, current arisings. Following IFM being placed in business rescue,
the PGE mineral reserve at Phoenix Platinum declined year on year.
As at June 2016 Tonnes Grade Contained PGE’s
Category (million) (g/t) Tonnes Moz
Mineral Reserve Proved 1.4 2.43 3.4 0.1
Probable 1.3 2.65 3.4 0.1
Pan African Resources Total 2.7 2.54 6.8 0.2
Coal
Group Coal Mineral Resources
The Group's attributable coal mineral resource was declared as 23.3Mt as at
June 2016.
Resources Raw Coal Qualities (ad)
Class MTIS (Mt) RD IM (%) Ash (%) VM (%) FC (%) CV (MJ/kg) TS (%)
Measured 15.0 1.50 2.5 23.5 24.3 49.8 24.75 1.23
Indicated 4.3 1.51 2.5 23.8 23.9 49.8 24.62 1.14
Inferred 4.0 1.50 2.4 23.4 23.4 50.9 25.02 1.03
Total 23.3
Resources 12% Ash Product
Class MTIS (Mt) Yield (%) IM (%) Ash (%) VM (%) FC (%) CV (MJ/kg) TS (%)
Measured 15.0 73.9 2.7 12.0 28.0 57.3 28.96 0.96
Indicated 4.3 76.2 2.8 12.0 27.5 57.8 29.00 0.97
Inferred 4.0 80.1 2.6 12.0 26.6 58.9 29.22 0.92
Total 23.3
The abbreviations used in the above table are as follows:
MTIS: mineable tonnes in situ; RD: relative density; IM: inherent moisture;
VM: volumetric moisture; FC: fixed carbon;
CV: calorific value; and TS: total sulphur.
Group organic growth
Current exploration drilling as well as accessing and developing of our
orebodies were maintained during the year. The strategy of converting Mineral
Resource to Mineral Reserve was progressed by moving organic projects further
up the mining value chain towards commissioning. The tables below reflect the
progress of near-mine growth projects that have contributed ounces to the
Mineral Resource for the year.
Group: Exploring the orebody - exploration drilling
Operation Total metres No. of boreholes Average channel width (cm) No. of intersections above cut-off Average grade (g/t) Total expenditure (Rm)
Barberton Mines 9 916 118 146 50 17.46 7.0
Evander Mines 567 9 27 1 16.20 0.6
Exploration drilling projects at Barberton Mines yielded positive results on
all three operations (see table below).
At Fairview Mine, exploration drilling confirmed a further 70m down dip
extension of the MRC orebody with a high-grade intersection of 125.80g/t
over 680cm.
Recent borehole results are detailed below:
Borehole number Channel width cm Grade g/t
Fairview Bh 5951 680 125.80
Sheba Bh SWR 15 100 28.90
New Consort Bh 14L19 100 22.80
New Consort Bh 33C2 100 17.00
Group: Accessing the orebody - on-reef development
Operation Total on-reef development (m) Average grade (g/t)
Barberton Mines 926 4.41
Evander Mines 330 41.59
Barberton Mines: Developing the orebody - capital ore reserve projects
Project Y/E 30 June 2016 (m) Y/E 30 June 2015 (m) Y/E 30 June 2014 (m) Potential resource (oz)
Sheba – pillar development 540 824 351 23 599
Sheba – Edwin Bray to Thomas and Joe’s Luck area 27 5 171 13 246
Fairview – 11 Level Royal Reef 0 (equipping old main shaft) 0 (equipping old main shaft) 0 17 000
Fairview – 1# ore reserve opening 131 84 154 14 821
Fairview – No. 3 Shaft deepening 64 26 0 1 600
Fairview – 64-68 Level 581 447 295 860 766
Sheba Western Cross 133 295 71 32 022
Royal Sheba 189 165 0 206 750
Consort – 33-45PC 387 258 193 10 000
Consort – MMR pillar development 0 0 173 (new target area)
8-3 # 17 327 253 900
Evander Mines: Developing the orebody - capital ore reserve projects
Project Y/E 30 June 2016 (m) Y/E 30 June 2015 (m) Y/E 30 June 2014 (m) Potential resource (oz)
2 Decline 24–25 Level 356 904 686 1 200 000
25 A block ventilation 87 10 925
Group growth projects
Elikhulu
Following receipt of a positive PFS for the Elikhulu Project, the Company
mandated DRA Projects to conduct a DFS on the project. The study will be
available by November 2016, after which shareholders will be appraised.
In March 2016, SRK Consulting (South Africa) (Pty) Limited independently
estimated the mineral resource of the Elikhulu Project at 178.7Mt @ 0.29g/t
(1.7Moz).
2010 Payshoot
A surface exploration drilling programme was initiated during the year to
define additional mineral resources for the 2010 payshoot. The 2010 payshoot
is a secondary payshoot originating from the main Kinross payshoot and can be
accessed from the No. 3 Decline at Evander No. 7 Shaft. Previous surface holes
in this area delivered results up to 36.04g/t over a Kimberley reef width of
49cm. The potential mineral resource of the 2010 payshoot is estimated at
6.3Mt @ 10.82g/t (2.2Moz).
The Company’s current generic growth projects are summarised hereunder:
Evander Mine Projects Category Tonnes (million) Grade (g/t Ounces (Moz) Depth below surface (m)
Elikhulu Project Resource 178.7 0.29 1.7 on surface
2010 Payshoot Resource 6.3 10.82 2.2 1 800 – 2 500
Reporting in compliance with SAMREC Code
To meet the requirement of the South African Code for the Reporting of
Exploration Results, Mineral Resources and Mineral Reserves ("SAMREC Code")
that the material reported as a Mineral Resource should have "reasonable and
realistic prospects for eventual economic extraction", Pan African Resources
has determined an appropriate cut-off grade which has been applied to the
quantified mineralised body. In determining the cut-off grade, Pan African
Resources uses a gold price of R550 000/kg. At our underground mines, the
optimal cut-off is defined as the lowest grade at which an orebody can be
mined to maximise total profits, under a specified set of mining parameters.
The Mineral Resource optimiser tool accordingly developed in-house was applied
to the Mineral Resource inventory.
The optimiser programme requires the following inputs to convert the Mineral
Resource to the Mineral Reserve:
* the on-mine database inventory of all mineral resource blocks;
* an assumed gold price - ZAR450 000/kg;
* planned production rates for each mine;
* mine call factor;
* plant recovery factors; and
* historical cash operating costs and other efficiency factors.
The Mineral Reserves represent that portion of the Measured and Indicated
Mineral Resources above cut-off in the LOM plan and have been estimated after
considering the modifying factors affecting extraction. A range of disciplines
has been involved at each mine in the LOM planning process including geology,
surveying, planning, mining engineering, rock engineering, metallurgy,
financial management, human resources management and environmental management.
Note: Mineral Resources are inclusive of the Mineral Reserve, unless otherwise
stated.
Rounding of numbers contained in this announcement may result in minor
computational discrepancies.
Competent Person
The competent person for Pan African Resources, Mr Barry Naicker, the group
Mineral Resource Manager, signs off the MR&MR for the Group and has reviewed
and approved the information contained in this announcement in writing. He is
a member of the South African Council for Scientific Professions (400234/10).
Mr Naicker has 15 years of experience in economic geology and mineral resource
management.
He is based at 1st Floor, The Firs, cnr. Cradock and Biermann Avenues,
Rosebank, 2196, Gauteng.
Johannesburg
21 September 2016
Contact Information
Corporate Office
The Firs Office Building
1st Floor, Office 101
Cnr. Cradock and Biermann Avenues
Rosebank, Johannesburg
South Africa
Office: + 27 (0) 11 243 2900
Facsimile: + 27 (0) 11 880 1240
Registered Office
Suite 31
Second Floor
107 Cheapside
London
EC2V 6DN
United Kingdom
Office: + 44 (0) 207 796 8644
Facsimile: + 44 (0) 207 796 8645
Cobus Loots Deon Louw
Pan African Resources PLC Pan African Resources PLC
Chief Executive Officer Financial Director
Office: + 27 (0)11 243 2900 Office: + 27 (0) 11 243 2900
Phil Dexter John Prior / Paul Gillam / James Black
St James's Corporate Services Limited Numis Securities Limited
Company Secretary Nominated Adviser & Joint Broker
Office: + 44 (0)207 796 8644 Office: +44 (0)207 260 1000
Sholto Simpson Matthew Armitt / Ross Allister
One Capital Peel Hunt LLP
JSE Sponsor Joint Broker
Office: + 27 (0)11 550 5009 Office: +44 (0)020 7418 8900
Jeffrey Couch / Neil Haycock / Thomas Rider
BMO Capital Markets Limited
Joint Broker
Office: +44 (0)20 7236 1010
Julian Gwillim Daniel Thöle
Aprio Strategic Communications Bell Pottinger PR
Public & Investor Relations SA Public & Investor Relations UK
Office: +27 (0)11 880 0037 Office: + 44 (0)203 772 2500
www.panafricanresources.com
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