| Thu 7 Jun 2007, 8:45 | | DRD - DRDGold - Drdgold And Mintails Limited Annou |
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DRD
DRDD
DRD - DRDGold - Drdgold And Mintails Limited Announce East Rand Gold Tailings
Treatment Joint Venture And Agreement With Anglogold Ashanti Limited
Press Release
DRDGold Limited
(Incorporated in the Republic of South Africa)
(Registration number 1895/000926/06)
ARBN: 086 277 616
JSE trading symbol: DRD
ISIN: ZAE000058723
Issuer code: DUSM
Nasdaq trading symbol: DROOY
("DRDGOLD")
DRDGOLD AND MINTAILS LIMITED ANNOUNCE EAST RAND GOLD TAILINGS TREATMENT JOINT
VENTURE AND AGREEMENT WITH ANGLOGOLD ASHANTI LIMITED
DRDGOLD and Mintails Limited (ASX: MLI) today announced the formation of a new
joint venture ("the JV") between Mintails SA (Pty) Limited ("Mintails SA"), a
wholly owned subsidiary of Mintails Limited, and DRDGOLD South African
Operations (Pty) Limited ("DRDGOLD SA"), which is 74% held by DRDGOLD with the
balance being held by its BEE partners, Khumo Gold SPV (Pty) Limited and an
employee trust. The JV has acquired from AngloGold Ashanti Limited ("AngloGold
Ashanti") significant gold-bearing tailings materials created from historic gold
production and remaining infrastructure surrounding ERGO, a surface reclamation
operation on South Africa`s East Rand goldfields which was discontinued by
AngloGold Ashanti in 2004.
It is envisaged that the JV, together with the additional tailings resources and
infrastructure acquired from AngloGold Ashanti, will create significant
potential for the processing of surface gold tailings on the East Rand
goldfields.
Over its 25-year history, ERGO processed more than 890 million tonnes of
tailings material on the East Rand and produced approximately 8.2 million ounces
of gold through two plants, Brakpan and East Daggafontein. These two plants were
purchased by Mintails SA in 2006.
Following discussions initiated in the first quarter of 2007, the JV parties
agreed to pursue a strategy to consolidate certain of their assets on the East
Rand. Mintails SA will contribute one fully refurbished CIL circuit at the
Brakpan plant and DRDGOLD SA will contribute the Elsburg Tailings Complex,
comprising approximately 180 million tonnes of tailings.
Mintails SA and DRDGOLD SA will each own 50% of the JV. The JV will be managed
by Crown Gold Recoveries (Pty) Limited, a subsidiary of DRDGOLD SA, which has
treated more than 200 million tonnes of sand and slime and produced
approximately 2.8 million ounces of gold through its plants.
The initial phase of the project envisages the refurbishment of one CIL circuit
at the Brakpan plant which will have the capacity to treat an estimated 1.25
million tonnes of tailings per month. This is dependent on the outcome of the
current drilling and testing evaluation. Depending on the outcome of the
feasibility study, it is possible that the first gold production could commence
within 24 months. The process will involve the treatment of tailings from the
Elsburg Tailings Complex through the Brakpan plant with residue being deposited
on the East Daggafontein deposition site.
The JV has entered into a Sale of Assets agreement with Anglogold Ashanti in
terms of which the JV will acquire the remaining moveable and immovable assets
of ERGO. These assets will be operated by the JV, for its own account, under the
Anglogold Ashanti authorisations until new order mining rights have been
obtained and transferred to the JV. These assets, comprising servitudes (access
agreements), infrastructure, piping, equipment and the right to an additional 15
million tonnes of tailings material, provide a platform to consolidate these
tailings assets with the Elsburg Tailings.
If certain necessary criteria are met, the JV parties consider that the
consolidation and treatment of these remaining surface assets on the East Rand
could provide significant potential value-add to the JV and to the respective
participants.
On 26 April 2007, Mintails and DRDGOLD announced the formation of a separate
joint venture company to explore, evaluate and potentially mine gold and uranium
by open cast and underground mining methods on the West Rand. This West Rand
joint venture is a distinct and separate entity from the JV described above. The
West Rand joint venture is expected to list as a new company on the Australian
Stock Exchange in due course, once the Initial Public Offering is completed.
7 June 2007
Sponsor
BDO QuestCo (Pty) Limited
Date: 07/06/2007 08:45:00 Produced by the JSE SENS Department.
