REG-Pan African Resources Plc: Operational Update

Pan African ResourcesAnnouncement

12/07/2018 08:35

Pan African Resources PLC

(Incorporated and registered in England and Wales under Companies Act 1985
with registered number 3937466 on 25 February 2000)

AIM Code: PAF

JSE Code: PAN

ISIN: GB0004300496

(“Pan African” or the “Company” or the “Group”)

  OPERATIONAL UPDATE

Following the operational updates released in March and May 2018, Pan African
is pleased to provide preliminary production results for the financial year
ended 30 June 2018, production guidance for the 2019 financial year and
further information on the Group’s operations and organic growth projects.

Key highlights are summarised as follows:
*
Improved safety performance year-on-year with no fatalities (2017: three
fatalities).
 Barberton Mines commendably achieved one million fatality free shifts during
June 2018.
*
Group gold production of 160,421oz in the 2018 financial year, ahead of its
most recent production guidance of 157,000oz - 160,000oz.
*
Barberton Mines produced 90,628oz for the 2018 financial year, within its
production guidance of 90,000oz - 91,000oz. During the second half of the
financial year, Barberton Mines produced 50,017oz of gold, a 23% increase on
its first half production.
*
Evander Mines produced 69,793oz for the 2018 financial year, exceeding its
production guidance of 67,000oz - 69,000oz.
*
Construction of the Elikhulu Tailings Retreatment Plant (“Elikhulu”)
remains on track and within budget for first gold in August 2018, with
construction now entering the commissioning phases of the project.
*
The Royal Sheba Project feasibility study at Barberton Mines is expected to
conclude during September 2018.
*
Production guidance for the 2019 financial year is approximately 170,000oz,
excluding any production from Evander’s underground operations.With the
previous high cost ounces from the Evander underground now replaced by
production from low cost surface remining operations, production costs are
also expected to demonstrate a significant improvement.

Pan African Resources CEO Cobus Loots commented:

“The 2018 financial year was extremely challenging for the Group, both
financially and operationally.  However, during the past six months, we have
successfully addressed key deliverables that were critical to the future
sustainability of Pan African Resources. We are now re-positioned as a
lower-cost, long-life gold miner, consistent with stakeholder expectations.”

Group safety

The Group experienced no fatalities in the 2018 financial year (2017: three
employees fatally injured). The Group’s lost-time injury frequency rate
remained stable at 3.73 (2017: 3.51), while the reportable injury frequency
rate improved materially to 1.08 (2017: 1.53). In terms of safety
performances, significant progress was made over the past year with on-mine
safety improvement campaigns contributing to these results. Further, Barberton
Mines achieved its one million fatality free shifts milestone during June
2018. To ensure continued safety improvements, the Group will be engaging
independent safety experts to review each of the mining operations’ safety
systems and controls.

Barberton Mines

Barberton Mines produced 90,628oz of gold for the 2018 financial year,
comfortably within the production guidance of 90,000oz - 91,000oz. The
operation successfully produced 50,017oz during the second half of the 2018
financial year, which was an increase of 23% from gold produced during the
first half. Barberton Mines’ production performance during the second half
of the 2018 financial year was underpinned by Fairview Mine’s 11-block MRC
272 and 358 platforms.

Evander Mines

Evander Mines ceased its underground mining operations and concluded its
retrenchment process at the end of May 2018. Evander Mines produced 69,793oz
of gold for the 2018 financial year, above the production guidance of 67,000oz
- 69,000oz.

The Evander Tailings Retreatment Plant (“ETRP”) and surface sources
produced 19,874oz, marginally below the production guidance of between
20,000oz - 21,000oz.

Evander Mines’ underground mining operation concluded the 2018 financial
year with 49,919oz of gold produced, exceeding the guidance provided of
46,000oz.

Elikhulu construction

As previously communicated, construction at Elikhulu is progressing ahead of
schedule with first gold expected in August 2018. The construction teams are
now entering the commissioning phases of the project, in anticipation of a two
month ramp-up period to full production. The Elikhulu project is expected to
produce approximately 55,000oz of gold per annum, at an all-in sustaining
production cost of between US$650/oz and US$700/oz.

The transfer of the ETRP processing capacity into Elikhulu is on track and
scheduled for December 2018. Elikhulu, in conjunction with the ETRP, is
expected to produce approximately 70,000oz per annum.

Royal Sheba project

The Royal Sheba orebody at Barberton Mines has the potential to deliver
approximately 30,000oz per annum. The Company mandated DRA Global to undertake
a life-of-mine technical feasibility study on the orebody and the study is
expected to be concluded during September 2018.

The information contained in this announcement has not been reviewed or
reported on by Pan
African’s auditors and is the responsibility of the directors of Pan
African.

Certain information contained in this announcement would have constituted
inside information (as defined by Article 7 of Regulation (EU) No 596/2014)
prior to its release as part of this announcement.

For further information on Pan African, please visit the Company’s website
at www.panafricanresources.com

12 July 2018

 Contact information                                                                                                                                                                                                                                                                                                                                      
 Corporate Office The Firs Office Building 2nd Floor, Office 204 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 Pan African Resources PLC Chief Executive Officer Office: + 27 (0) 11 243 2900                                                                                                          Deon Louw Pan African Resources PLC Financial Director Office: + 27 (0) 11 243 2900                                                                  
 Phil Dexter St James's Corporate Services Limited Company Secretary Office: + 44 (0) 207 796 8644                                                                                                   John Prior / Paul Gillam Numis Securities Limited Nominated Adviser and Joint Broker Office: +44 (0) 20 7260 1000                                    
 Sholto Simpson One Capital JSE Sponsor Office: + 27 (0) 11 550 5009                                                                                                                                 Ross Allister/James Bavister/David McKeown Peel Hunt LLP Joint Broker Office: +44 (0) 207 418 8900                                                   
 Julian Gwillim Aprio Strategic Communications Public & Investor Relations SA Office: +27 (0)11 880 0037                                                                                             Jeffrey Couch/Neil Haycock/Thomas Rider BMO Capital Markets Limited Joint Broker Office: +44 (0) 207 236 1010                                        
 Bobby Morse Buchanan Public & Investor Relations UK Office: +44 (0)20 7466 5000 Email: PAF@buchanan.uk.com                                                                                                                                                                                                                                               
 Website: www.panafricanresources.com                                                                                                                                                                                                                                                                                                                     



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