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Simmers - Underground production resumes at Simmers" Buffelsfontein Mine
SIMMER AND JACK MINES, LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1924/007778/06)
("Simmers") or ("the Company")
Share code: SIM
ISIN: ZAE000006722
PRESS RELEASE
UNDERGROUND PRODUCTION RESUMES AT SIMMERS" BUFFELSFONTEIN MINE
Stilfontein - Veteran miner Roger Kebble today gave the signal which marked the
resumption of underground activities at Buffelsfontein Mine in the North West.
It was the first time that ore had been brought to the surface since the mine
was placed in provisional liquidation over seven months ago.
"Today marks the beginning of a brighter future for the people of Stilfontein,"
said Simmers chairman Roger Kebble. "Together I am confident that we can turn
these operations around and create something to be proud of, namely a solid
operation producing 230 000 ounces of gold per annum for at least the next ten
years."
He stressed that the fact that the deal had been concluded so quickly with
organised labour was an extraordinary testimony to the people who had worked so
hard to bring the deal to fruition.
"For gold mining in South Africa to survive and thrive, it takes a pact with
State, Labour and Capital, and that is exactly what we have achieved in Simmer &
Jack Buffelsfontein," said Kebble.
According to Simmers chief executive, Gordon Miller, it would take a few months
to build up to full production: "By June next year we anticipate that we will be
producing 581 kilograms per month at a total cash cost of R46-million per month.
"This works out at a total cash cost of $367 per ounce at the current
Rand/Dollar exchange rate, or R79 000 per kilogram. With the current gold price
at approximately R100 000 per kilogram, this is excellent news considering that
the success of Buffelsfontein was predicated on a gold price of US$420 per ounce
and a Rand/ Dollar exchange rate of R6.3, which works out to approximately R85
000/kg," said Miller.
An upbeat Miller said that he was optimistic about the future of the marginal
mime. "If all goes according to plan, Simmer & Jack Buffelsfontein will
experience a positive cash flow by the end of January 2006, and if the gold
price holds, this project will be paid off within a year which bodes extremely
well for the 3 800 people we will eventually employ."
As a new development, Simmers has commenced a feasibility study to assess the
viability of the surface and underground resources at Buffelsfontein for
Uranium. "We have 290 million tonnes of surface material and 67 million tonnes
of underground resource that is known to contain Uranium. Given the recent
substantial increase in the Uranium spot price, we have commenced exploration
drilling, metallurgical test work, and mineral resource estimation to assess the
economic potential of this resource". Preliminary results of the study are
expected early next year.
FOR FURTHER INFORMATION, PLEASE CONTACT GAIL STRAUSS ON 084 777 4060 OR LUCY
CORKIN ON 082 850 4774.
Date: 02/11/2005 01:06:11 PM Produced by the JSE SENS Department
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