Kibali Mine Development

Transcription

1 Kibali Mine Development The Kibali mine development in the Democratic Republic of Congo is the largest project undertaken to date by Randgold. With a reserve base at plus 10 million ounces and still growing, it will rank as one of the largest gold mines in Africa. KIBALI MINE DESIGN KIBALI MINE KEY INDICATORS for the 12 months ended 31 December KIBALI FORECAST PRODUCTION (000oz) Forecast Reserves Resources KIBALI TOTAL RESOURCES AND RESERVES (Moz) RANDGOLD RESOURCES Annual Report 2011

2 Achieved in 2011 KIBALI PLANT DESIGN Substantially bigger project defined All predevelopment objectives achieved; preconstruction underway Public participation process completed; community resettlement (RAP) advanced with first two villages successfully moved to new model town of Kokiza Detailed design of first hydropower facility completed Project infrastructure enhanced through major road construction programme Grade control of main KCD pit started Key long lead time orders placed Camp infrastructure enhanced to facilitate construction start-up Local partnerships developed in RAP construction Targeted for 2012 Source: DRA Mineral Projects KIBALI HEADGEAR AND SHAFT DESIGN Start construction of plant and infrastructure Complete detailed design for vertical shaft; begin decline and shaft development Start open pit mining Commence assembly of operational team Complete construction of first hydropower facility Start construction of employee housing Progress community resettlement to final stage Annual Report 2011 RANDGOLD RESOURCES 47

3 Kibali Mine Development (continued) The Kibali project is a gold development property which covers an area of 1 836km 2 on the Moto Goldfields in the north east of the DRC. It is located some 560 kilometres north east of the city of Kisangani and 150 kilometres west of the Ugandan border town of Arua. Kibali is a joint venture between Randgold (45%), AngloGold Ashanti (45%) and a Congolese parastatal, Sokimo (10%). The project development is being managed by Randgold which will also operate the mine. It is envisaged that the Kibali mine will comprise an integrated open pit and underground operation with the core capital programme scheduled to run over the next four years. It is anticipated that the project will ultimately be supplied by four hydropower stations supported by a thermal power station for low rainfall periods and back-up. The Moto Goldfields are located within the Moto greenstone belt, which is comprised of the Archean Kibalian (Upper and Lower) volcano-sedimentary rocks and ironstone-chert horizons that have been metamorphosed to greenschist facies. The stratigraphy consists of a volcano-sedimentary sequence comprising finegrained sedimentary rocks, several varieties of pyroclastic rocks, basaltic flow rocks, mafic-intermediate intrusions (dykes and sills) and intermediate-felsic intrusive rocks (stocks, dykes and sills). The majority of gold mineralisation identified to date is disseminated style, hosted within a sequence of coarse volcaniclastic and sedimentary rocks. The mineralisation is generally stratigraphic and associated with quartz-carbonate alteration and pyrite. Feasibility study and mine development PROgress The project successfully completed a critical year with the optimised feasibility study having been finalised by year end, as scheduled. The optimised feasibility presents a larger project compared to the previously published feasibility study, with a plant throughput of 6 million tonnes per annum, due to be commissioned in the fourth quarter of During the year, the Resettlement Action Plan (RAP) progressed on schedule, with the first two of the 14 villages successfully relocated to the new model village of Kokiza. This programme remains on the critical path to ensure the timely start-up of mining and construction. For more information on this project, please refer to the Sustainability Report on pages 76 to 104. At the same time, grade control drilling on the main KCD pit started, in advance of the mining activities which are scheduled to begin in the second quarter of KIBALI RESOURCES AND RESERVES Attributable gold*** Tonnes (Mt) Grade (g/t) Gold (Moz) 45% (Moz) at 31 December Category MineRAl resources* Open pit Indicated Inferred Underground Indicated Inferred Total mineral resources Indicated Inferred MineRAl reserves** Open pit Probable Underground Probable Total mineral reserves Probable * Open pit mineral resources are the insitu mineral resources falling within the US$1 500/oz pit shell reported at a cut-off of 0.5g/t. Underground mineral resources are those insitu mineral resources at the KCD deposit that fall below the metre RL elevation, reported at a cut-off of 1.5g/t. Mineral resources were generated by Mr Ernest Doh, an officer of the company and competent person. ** Open pit mineral reserves were reported at a gold price of US$1 000/oz and an average cut-off of 0.9g/t and include dilution and ore loss factors. Open pit mineral reserves were calculated by Mr Onno ten Brinke and Mr Nicholas Coomson, both officers of the company and competent persons. Underground mineral reserves were reported at a gold price of US$1 000/oz and a cut-off of 2.2g/t and include dilution and ore loss factors. Underground mineral reserves were calculated by Mr Andrew Fox and Mr Tim Peters, both independent consultants and competent persons. *** Attributable gold (Moz) refers to the quantity attributable to Randgold based on Randgold s 45% interest in the Kibali gold project. See comments and US disclaimer on page 74 of this Annual Report. 48 RANDGOLD RESOURCES Annual Report 2011

4 DEVELOPMENT TIMELINE Throughout the year, significant improvements were made to the surrounding infrastructure, especially roads, with approximately 200 kilometres of existing roads upgraded and 300 kilometres of new roads completed. Significant improvements to the existing camp and preparation for the new 400 man construction camp were completed, as well as the design of the first hydropower station. In total, US$157.4 million was spent on the project (100%). An updated costing and feasibility study was completed based on a revised underground mining plan which incorporated the combination of a twin decline and vertical ore hoisting shaft targeting the deeper 5000 lode as a priority. This was then integrated into a final mining plan including multi open pit and underground schedules. The study has been through internal and external review. Optimisation of the mining and processing rates, capital estimate scheduling, and the final design was approved by the Randgold board in January 2012 and is awaiting approval by the AngloGold Ashanti board. The revised open pit and underground mining designs and schedules support a 6Mtpa operation, planned for commissioning in the last quarter of 2013 and extending to The prospectivity of the area suggests this mine life could be extended with further exploration and conversion of these new discoveries and extension of mineral reserves. KIBALI PREDEVELOPMENT Annual Report 2011 RANDGOLD RESOURCES 49

5 Kibali Mine Development (continued) KIBALI: MINERALISED WIREFRAME OF KCD OREBODY WITH CONDUCTIVITY MODEL Updated processing and general administration (G&A) costs have been determined based on the larger plant throughput and higher power load demand of the underground mine. A standard crushing, milling and Carbon in Leach (CIL) processing plant is expected to be commissioned on plant start-up, planned for late Full flotation and flash flotation circuits will be incorporated to recover the sulphide for an overall increase in gold recovery. The underground mine design consists of a twin decline that accesses the ore beneath the KCD pit and then connects with a vertical shaft ore hoisting system to exploit the high tonnage stopes planned for the 5000 lode and deeper 9000 lode. The aim is to target the large 5000 lode from a mid-level off the shaft and the declines, thus bringing the large longhole open stopes of this lode into production quicker. RSV Perth completed the feasibility study for the shaft and electrical reticulation of the underground mine. The updated Life of Mine (LOM) study, which is based only on existing reserves, currently anticipates: Total open pit ore mined of 37.2Mt of ore containing 3.4Moz of gold at a strip ratio of 4.7:1. Total underground ore mined of 36.2Mt containing 6.8Moz of gold, giving combined total tonnes mined of 249Mt. Open pit mining costs average US$3.98/tonne mined over the LOM. Underground mining costs including ore development of US$51.45/ore tonne. Mill throughput of 6Mt per year. Plant costs average US$14.33/tonne milled. G&A cost of US$6.37/tonne milled over the LOM, including outside engineering costs and Aru road maintenance. Source: DRA Mineral Projects DETAILED KIBALI PLANT DESIGN 50 RANDGOLD RESOURCES Annual Report 2011

6 LIFE OF MINE FINANCIAL MODEL Results* The construction capital (excluding contingencies or escalation) is split into two phases: Phase 1 capital programme, to bring the mine into production at the end of 2013 (first gold), is estimated at US$920 million (in 2011 money) and will cover the metallurgical facility, one hydropower station and back-up thermal power facility, construction of the tailings storage facility, relocation of villages, open pit mining and all shared infrastructure. This will run over a two year period. Phase 2 capital programme, which will run concurrently with Phase 1 but will extend over four years, is focused primarily on the underground development and includes a twin decline and vertical shaft system as well as three hydropower stations. This is expected to bring the underground into first production by the end of 2014, with steady state production targeted for the end of Phase 2 capital cost is estimated at US$650 million (in 2011 money). Internal rate of return (IRR) 22% Total cash cost per ounce US$515/oz * Using a US$1 400/oz gold price. The LOM financial model carried out using a US$1 400/oz gold price gave the returns and cash costs of production shown in the table above. Assuming a gold price of US$1 500/oz, peak funding of US$1.2 billion is expected during Design and planning is now in the process of being implemented with earthworks and open pit mining having started early in 2012 and decline and shaft sinking scheduled for the second half. The advanced grade control drilling on the KCD pit is well advanced and will be completed together with predewatering of the open pit, decline and shaft sites prior to development. GEOTECHNICAL DRILLING FOR kibali shaft Annual Report 2011 RANDGOLD RESOURCES 51

7 Kibali Mine Development (continued) THE NEW KOKIZA VILLAGE NEAR KIBALI Health, safety and environment The introduction during the year of an additional construction employees, mostly novices from the surrounding villages, to the workforce resulted in Lost Time Injuries (LTIs) increasing from 11 in 2010 to 31 in The increase mainly concerned finger injuries sustained in the building of resettlement houses. Despite the increase in the number of LTIs, the LTIFR decreased year on year from to 6.14 reflecting the significant increase in construction activity. As the year progressed the number of safety incidents and LTIs injuries dropped as concerted steps were taken such as continuing risk assessments, daily toolbox meetings, elimination of hazards and enhanced supervision to improve safety practices. Environmental monitoring continues as defined in the ESIA document prepared by Digby Wells and Associates. Community The community development function at Kibali worked in close liaison with the RAP, especially in the areas of food security, life skill training and liaison with the cultural committee when relocating graves. Beyond the relocation, Kibali witnessed a wider acceptance of the project in the area as we approached the start of physical movement of the people to the resettlement host site as a result of more engagement with various stakeholders. Human resources The Kibali project currently employs 16 expatriates and 123 local employees. There are a further 20 expatriates and local employees employed by contractors engaged in various aspects of the construction project. KIBALI MANPOWER Nat- Natat 31 Dec Expats ionals Total Expats ionals Total Employees Contractors Total For more details on health, safety, the environment, manpower and industrial and community relations at Kibali, refer to the Sustainability Report on pages 76 to 104 of this Annual Report. Exploration A brownfields exploration team is progressing the feasibility work and testing extensions on known deposits while a greenfields team is evaluating the greater lease area. More details can be found in the Exploration Review on pages 56 to 70 of this Annual Report. KIBALI EXPLORATION 52 RANDGOLD RESOURCES Annual Report 2011