| Thu 20 May 2010, 7:05 | | CRD - Central Rand Gold Limited - Interim management statement |
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CRD
CRD
CRD - Central Rand Gold Limited - Interim management statement
Central Rand Gold Limited
(Incorporated as a company with limited liability
under the laws of Guernsey, Company Number 45108)
(Incorporated as an external company with limited liability
under the laws of South Africa, registration number 2007/019223/10)
ISIN: GG00B24HM601
Share code on LSE: CRND
Share code on JSE: CRD
("CRG" or the "Company" or the "Group")
INTERIM MANAGEMENT STATEMENT
HIGHLIGHTS
Metallurgical plant upgrade and optimisation completed
Decline development 952m from portal
Second decline two months ahead
Additional surface exploration target identified.
US$11.2 million cash balance at the end of March 2010
Progress towards further equity fund raising on track
OPERATIONAL UPDATE
Mining
Decline development within the high grade eastern payshoot is now 155m below
surface and advanced an estimated 952m. The second decline development targeting
the high grade western payshoot has started two months ahead of schedule and has
already advanced 85m and is 153mbs. A total of 271m of reef development has been
completed to date.
Both mining and processing personnel have now converted to a continuous 12-hour
shift roster. This change in shift hours is expected to significantly improve
efficiencies and reduce costs compared to the previous 8-hour shift cycle
Metallurgy
A number of initiatives were implemented on the Metallurgical plant to improve
recovery and production. This was undertaken mainly during March 2010 when the
plant was shut down while the necessary changes were made.
The steady feed into the Bateman concentrator was resolved by implementing a
live stockpile with withdrawal tunnel underneath to enable a controlled
vibrating feeder to consistently feed the optimal tonnage into the crushing
circuit and eliminate the lumpy feed issues to date. This has improved
throughput in the Bateman plant.
The CIL plant has been successfully converted into an increased capacity CIP
plant by the addition of a 150 cubic metres pre-leach tank with a shear reactor
to increase effective retention time and improve dissolved oxygen levels that
are critical to the leach process. Improved direct feed arrangements into the
CIP plant have also enabled a step increase in throughput through the circuit
and already a steady state 13 500 tpm has been achieved at current mining rates.
We are currently processing the oxide material from open pits through the plant
while the underground development opens up new stoping areas for sulphide ore
scheduled for the latter part of 2010.
From a production perspective the Bateman concentrator is achieving an excellent
recovery on the oxide material, however, throughput and availability is still
being optimised.
The CIP has been performing very well to forecast and is achieving both expected
recovery and throughput on the oxide material. Availability has since start up
in March exceeded forecast.
During processing of underground sulphide material we achieved consistent tail
grades of around 0.2g/t on both the flotation plant and leach circuit which are
confirming the expected recoveries once steady state sulphide production is
underway later this year.
The gold produced for year to date is 2 312 oz to 10 May 2010. This includes
both bullion smelted on site and loaded carbon sent to Rand Refinery for
processing.
Exploration
The Company has put in place several strategies to leverage off the current high
gold price and provide additional ore material to ensure that the process plant
continues to operate to capacity during the ramp up to underground stope
production.
Current Expansion of Open Pit Operations
The company has recently secured permission to extend open pit operations,
approximately one kilometre from the process plant. Three open pits are
envisaged for this area providing approximately four months of production. The
highly weathered nature of the Main Reef, Middling and Main Reef Leader material
targeted by the company allows for extraction through free mechanical digging to
depths of around 20m. The pits will be rehabilitated concurrently with mining.
An estimated "Exploration Target" of between 30 000t and 40 000t at a grade of
between 2.8 g/t and 3.2 g/t has been identified to depths not exceeding 20m.
The new open pit operations in the New Unified Area are close to the existing
Process Plant at CMR.
Optimisation Studies underway for New Pits
Systematic mechanical trenching and geological mapping and sampling has
identified significant open pit "Exploration Target" potential in the "White
Reef, approximately two kilometres from the processing plant. Current work has
suggested that unlike the free digging Main Reef material in the immediate
vicinity of the plant, limited drilling and blasting may be required. The White
Reef is particularly well suited to open pit operations in that up to four gold
bearing units are present in widths of up to 2.5m.
Trench results are tabulated below:
Trench Top Band Mid Top Band Mid Basal Basal Band
Id Band
TR1 0.67g/t/70cm 0.34g/t/30cm 3.86g/t/90cm 0.08g/t/74cm
TR2 2.74g/t/52cm 0.45g/t/82cm
TR3 Cavity
TR4 1.16g/t/145cm 10.08g/t/47cm
TR4a 3.10g/t/200cm 3.45g/t/54cm
TR5 2.40g/t/195cm 0.88g/t/36cm
TR5a 2.59g/t/148cm
TR6a 2.54g/t/260cm
TR6b 4.1g/t/160cm
TR6c 10.04g/t/98cm 0.08g/t/55cm
TR6d 3.67g/t/130cm 0.49g/t/100cm
TR6f 0.37g/t/40cm 2.72g/t/280cm
TR6g Dyke
TR6h 2.09g/t/191cm 3.82g/t/65cm
TR6i 3.20g/t/200cm 2.46g/t/100cm
TR7 4.05g/t/102cm 3.72g/t/133cm
TR8 1.73g/t/84cm 4.43g/t/54cm
TR8a 1.18g/t/80cm 3.93g/t/50cm 2.26g/t/77cm 0.22g/t/90cm
TR9 1.37g/t/66cm 0.89g/t/123cm
TR10 2.26g/t/83cm 1.79g/t/45cm 0.61g/t/35cm 0.21g/t/20cm
TR10a 2.33g/t/132cm 1.26g/t/40cm
TR10b 1.10g/t/120cm 1.28g/t/120cm
TR11 1.44g/t/30cm 4.12g/t/30cm 0.79g/t/30cm 0.19g/t/40cm
TR12 0.63g/t/92cm 2.16g/t/40cm 0.61g/t/171cm
TR13 Dyke
TR14 0.39g/t/79cm 1.44g/t/35cm 0.23g/t/37cm 0.35g/t/40cm
An estimated "Exploration Target" of between 190,000t and 210,000t at an
approximate grade of around 2.1 g/t has been discovered to date.
Footnote:
The potential quantity and grade described by the term "Exploration Target" is
conceptual in nature and there has been insufficient exploration to define a
Mineral Resource and it is uncertain if further exploration will result in the
definition of a Resource. Further exploration work is ongoing, and includes
trial mining and processing of this shallow target to establish grade and ore
body continuity, mineability, dilution and throughput characteristics.
Cash Position
As at the end of March 2010, the Company had approximately US$11.2 million on
hand. Set out below is an abridged cash flow statement.
Cash Reconciliation Value US$
(million)
Balance as at 31 December 2009 15.9
Cash Box proceeds, 22 January 2010 5.8
Capital Expenditure -0.8
Operational and Administrative Expenditure -11.5
Forex -0.4
Other Income 0.8
Gold Sales 1.4
Balance as at end March 2010 11.2
Capital Raising
As indicated in the Chairman`s Report of Annual Report 2009, it is envisaged
that additional equity finance of at least US$35 million will be sought to fund
the Company`s mine development plan and provide the platform for sustainable
gold production going forward.
Black Economic Empowerment
At the hearing of the interdict applications on 5 November 2009, the Court
dismissed Puno`s request for an urgent interdict to halt CRG`s trial mining
activities and made a costs order against Puno to pay the costs incurred by the
CRG Group in opposing the application. Puno subsequently appealed and on 1 April
2010, the Court rejected Puno application for leave to appeal the decision
handed down by the South Gauteng High Court. The arbitration procedures are
continuing with Puno Gold Investments (Pty) Ltd. It is expected that the
arbitration proceedings will be completed within 2010.
Johannesburg
20 May 2010
JSE Sponsor
Macquarie First South Advisers (Pty) Limited
For further information, please contact:
Central Rand Gold +27 (0) 11 551 4000
Johan du Toit / Patrick Malaza
Evolution Securities Limited +44 (0) 20 7071 4300
Simon Edwards / Chris Sim / Neil Elliot
Macquarie First South Advisers (Pty) Limited +27 (0) 11 583 2000
Thembeka Mgoduso / Annerie Britz / Melanie de
Nysschen / Manisha Ramlakhan
Buchanan Communications +44 (0) 20 7466 5000
Bobby Morse / Katharine Sutton
Jenni Newman Public Relations (Pty) Limited +27 (0) 11 506 7300
Jenni Newman / Megann Outram
Date: 20/05/2010 07:05:17 Produced by the JSE SENS Department.
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