DRDGOLD Annual Report

Transcription

1 DRDGOLD Annual Report 21 17

2 Review of operations DRDGOLD reported two fatalities in FY21 compared with five in the previous year, translating into a 58% improvement in the Fatal Injury Frequency Rate (FIFR) from.178 per million hours worked to.75. The Dressing Station Injury Frequency Rate (DSIFR) improved by 27%, from to 17.8 and the Reportable Injury Frequency Rate (RIFR) by 11%, from 3.61 to The Lost Time Injury Frequency Rate (LTIFR) deteriorated by 8%, from 7.6 to 8.2. Total gold production in FY21 was 3% lower at oz. This was as a consequence of lower total gold production from Blyvoor, reflecting continuing volume recovery from the seismic damage caused to high-grade underground production areas towards the end of the previous financial year. After accounting for total operating costs, 7% higher at R million, total operating profit for the year was 14% lower at R191.7 million. Blyvoor Blyvoor, which mined its first ore in 1942, is on the north-western edge of South Africa s Witwatersrand Basin, to the south of Carletonville and 7km south-west of Johannesburg, in North West Province. The mine has both underground mining and surface tailings retreatment operations, and a gold plant with the capacity to treat some 4 tpm. Blyvoor has two main gold-bearing horizons: the Carbon Leader Reef (CLR) and the Main Reef, the latter located some 75m above the former. The reefs vary in thickness from five to 2cm. Recently, there has been a shift in focus to mining the Main Reef. Ore is mined from three underground shaft systems using the traditional, narrow-reef drill, blast and scrape method. Gold production from surface tailings retreatment accounts for approximately 27% of Blyvoor s total production. While Blyvoor s life of mine is projected to 23, its resource is widespread and production could extend for many years beyond this, depending on gold price and exchange rate performance among other factors. Blyvoor recorded one fatality in FY21 compared with three in the previous year. Consequently, the FIFR improved by 67.5%, from.2 to.65. The DSIFR improved by 33%, from to 19.59, while the LTIFR deteriorated by 15%, from to 13.57, and the RIFR by 3%, from 4.46 to Total gold production was 18% lower at oz. This reflects the combination of a 13% decline in underground gold production to oz and a 28% decline in surface gold production to oz. Underground production declined due to the impact on yield of seismic damage caused to high-grade mining areas in the last Blyvoor layout plan No 2 Slimes dam: East dam N No 2 Slimes dam: West dam No 3 Slimes dam No 2 Shaft No 3 Slimes dam No 4 Slimes dam No 4 Shaft No 2 Slimes dam No 1 Slimes dam No 1 Slimes dam: West dam No 5 Slimes dam No 1 Slimes dam: East dam Sub-outcrop General offices Detritus plant Mine offices No 6 Shaft Erosion channel No 7 Slimes dam Plant area No 6 Slimes dam No 5 Shaft Legend: Surface Shafts: 2, 4, 5, 6 Tailings deposition sites Main and general offices Gold plant Rock dumps Slimes dams Legend: Underground Carbon Leader Reef Main Reef Dykes Carbon Leader Reef probable reserves Main Reef probable reserves Mining licence area Ore conveyance 18

3 fault line Blyvoor: m 2 /in-stope employee quarter of FY29, and a month-long, wage-related strike in the first quarter of FY21. The decline in surface gold production can be attributed to lower volumes recovered from lower grade tailings material available, and to the discontinuation of the treatment of uneconomic rock dump material. While underground throughput increased by 5% to 633 t, underground yield was 17% lower at 3.79g/t. Surface throughput was 14% lower at t and surface yield 16% lower at.31g/t. 5 Nov 9 Dec 9 Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 Total operating costs increased by 28% to R /kg, reflecting the impact of lower gold production, wage increases and higher electricity tariffs. Underground operating costs were 27% higher at R /kg and surface operating costs, 11% higher at R18 771/kg. Blyvoor: reef tonnes broken 6 Operating loss was substantially lower at R26.8 million (FY29: R176.2 million profit) due to lower gold production and higher costs, and notwithstanding a higher average rand gold price received Oct 9 Nov 9 Dec 9 Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 Capital expenditure for the year was 18% lower at R79.6 million, reflecting the elimination of all unnecessary capital expenditure during Blyvoor s judicial management process. During the year, mining ramp-up continued towards the 2 5m 2 /pm targeted at the Way Ahead Project (WAP), and by yearend had reached some 1 75 m 2 /pm. Looking ahead, there will be continued focus on Blyvoor s key sustainability drivers: face length, face advance, productivity (m 2 /tec), and mix management. Blyvoor: geological section SOUTH Southern boundary Northern boundary NORTH Datum Pretoria series No.4 Shaft Johannesburg sub-group Bird Reef Main Reef Carbon Leader Reef North Leader fault line fault line Jeppestown sub-group -35 DRDGOLD Annual Report 21 19

4 Review of operations (continued) Crown Crown is the world s largest gold surface tailings retreatment facility. Its three metallurgical plants Crown, City Deep and Knights, located in the central Witwatersrand have a total retreatment capacity of 95 tpm. All utilise carbon-in-pulp (CIP) technology. Crown reported one fatality during FY21 compared with none in the previous financial year. Consequently, its FIFR deteriorated from to.16. While the DSIFR improved by 5% from to 6.6, the LTIFR deteriorated by 57% from 2.91 to 4.58, and the RIFR by 84% from.97 to During the fourth quarter of FY21, the surface circuit of East Rand Proprietary Mines Limited (ERPM) was incorporated into Crown. Crown s operating and financial results for FY29 and FY21 have been restated for comparative purposes. Gold production was 4% higher at 99 41oz, reflecting a 16% increase in yield to.43g/t. Throughput was 11% lower at t, reflecting the continued impact of deposition constraint at Crown s Nasrec deposition facility. From FY29, Crown s throughput was reduced in order to limit its deposition rate to 4 tpm (previously 6 tpm). Operating costs were 6% higher at R /kg due to wage increases and higher electricity tariffs, and as a result of a higher average rand gold price received, operating profit was 26% higher at R219.1 million. Capital expenditure, 7% higher at R45.9 million, was directed mainly towards long-lead items for the new 5km pipeline linking Crown s City Deep and Crown plants with Ergo. The pipeline, construction of which is under way and scheduled for completion in August 211, will allow Crown to restore its deposition capacity to 6 tpm. Restored deposition capacity provides the operation with the opportunity to bring to account potential new resources on the western and central Witwatersrand, thus increasing production and extending their lives. Ergo Ergo was established in 27 as a joint venture between DRDGOLD and Mintails Limited, primarily to recover and treat over a period of 12 years some 186Mt of surface tailings contained in the Elsburg Tailings Complex for gold. Now wholly owned by the DRDGOLD Group, Ergo has a network of surface rights that provide access to a further 6Mt of surface tailings deposited across the western, central and eastern Witwatersrand. As a second-phase development, in conjunction with the Crown/Ergo pipeline currently under construction, the Ergo plant's second carbon-in-leach (CIL) circuit will be refurbished to increase capacity from 1.2Mtpm to Crown and Ergo layout plan Crown Central and Eastern Witwatersrand Area Ergo N1 N M1 N3 Knights plant JOHANNESBURG GERMISTON Lycaste sand dump Cason sand dump M2 CMR slimes dam complex Existing Crown tailings deposition sites SOWETO N1 Top Star City Deep plant Crown plant M1 M2 Legend R56 35 kilometres Gold plants Tailings deposition sites Slime Reserves Sand Pump station Elsburg slimes BOKSBURG N3 Elsburg pump station Brakpan tailings deposition site N17 L/29 dump Return water pump station BENONI Ergo plant BRAKPAN HEIDELBERG Slimes dams and sand dumps partially removed 27 kilometres Roads Reclamation pipelines Proposed deposition pipeline linking Crown plants to Ergo tailings deposition site (5km) Grootvlei slimes Daggafontein plant Zincor plant & deposit site Marievale slimes NIGEL SPRINGS N17 Daggafontein tailings deposition site 25 kilometres 2

5 1.8Mtpm. Ergo is licensed to produce uranium and sulphuric acid, and a feasibility study to assess the potential of these by-products from the Ergo resource is ongoing. Ergo s safety statistics form part of those reported under Crown. Ergo: volume ( t) Mar 9 Jun 9 Sep 9 Dec 9 Mar 1 Jun 1 In its first full year of operation, Ergo continued ramp-up towards full production. Gold produced totalled oz, from throughput of t at an average yield of.9g/t. Operating costs were R /kg, and an operating profit for the year of R35.4 million was recorded. Capital expenditure of R68.6 million was directed mainly towards construction and commissioning of the second feeder pipeline from the Elsburg Tailings Complex to the Brakpan plant, and its associated infrastructure. Ergo s results for Q4 of FY21 indicate excellent progress made towards Phase 1 steady state. Throughput for the quarter was t close to the targeted 1.2Mtpm. Cash operating costs in terms of R/t were R2 already substantially below the targeted R3/t, and the margin was US$386/oz. Continuing volume increase and cost reduction are expected in FY211, with consequent margin improvement. It is anticipated that ongoing metallurgical research and development initiatives will deliver improved recoveries in the medium term. Ergo: yield (g/t) Mar 9 Jun 9 Sep 9 Dec 9 Mar 1 Jun 1 Ergo: costs (R/t) Mar 9 Jun 9 Sep 9 Dec 9 Mar 1 Jun 1 Ergo: gold produced (kg) Mar 9 Jun 9 Sep 9 Dec 9 Mar 1 Jun 1 Ergo: margin (R/kg) Mar 9 Jun 9 Sep 9 Dec 9 Mar 1 Jun 1 DRDGOLD Annual Report 21 21