MINE WATER MANAGEMENT

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1 MINE WATER MANAGEMENT Johan Wagner Group Water Consultant 28 July 2016

2 Disclaimer The information in this presentation may include forward-looking statements, which are based on current expectations and projections about future events. These statements may include, without limitation, any statements preceded by, followed by or including words such as target, expect, may, anticipate, estimate, will, and other words and terms of similar meaning or the negative thereof. These forward-looking statements, as well as those included in any other material discussed at the meeting, are subject to risks, uncertainties and assumptions, including, among other things, the development of Sibanye s business, general economic conditions and actions of regulators. In light of these risks, uncertainties and assumptions, the events in the forward-looking statements may not occur. No representation or warranty is made that any forward-looking statement will come to pass and no reliance should be placed on any forward-looking statement. No one undertakes to publicly update or revise any such forward-looking statement. 2

3 Mine water management Integrated water resource management Dynamic water systems management External and internal water management issues Water management: opportunities A complex and critical issue for the mining industry and the country 3

4 SibanyeAMANZI management strategy: background : Gold Fields Liquid Gold plan: 2013: SibanyeAMANZI strategy developed when Sibanye established 2014: Water Management Department (WMD), comprising a multi-disciplinary team, set up with a mandate to deliver one-stop, in-house, professional mine water management services unique in the mining industry cost saving 4

5 SibanyeAMANZI: objectives and key results The SibanyeAMANZI programme actively delivers across four critical functional areas: Ensuring water management COMPLIANCE and safety: water use licences (WULs), fit-for-purpose (based on water end use), health, statutory, structural, routine monitoring, incident management, closure Delivering INNOVATION and PROJECTS which deliver: cost reduction, value recovery, compliance and sustainability Supporting mining operations and maintenance: footprint: reductions in municipal water consumed, water pumped and solids discharged total cost of ownership: reduced cost separation, pumping, energy, use of chemicals Developing a culture of water use awareness and stewardship: relationships and catchment management forums with key stakeholders (government and communities), value adding third party mine visits Key differentiators are: innovation, business case driven, compliance reengineering, decision support system (MEMDSS), regional integration 5

6 Critical water concerns Acid mine drainage (AMD) current situation government solution the Sibanye alternative Compliance fair water use license administrative burden law vs regulator Water quality and quantity mine closure management data scarcity governmental infrastructure constraints resource quality objectives 6

7 Acid Mine Drainage Problem Recognized as 2 nd greatest environmental issue after global warming by the US Environmental Protection Agency Treatment of AMD declared an emergency in 2010 by DWS Short-term treatment has begun are limitations Long-term solution suggested by DWS no technical solution as yet cost apportionment of 2/3 rd to existing mines and 1/3rd to tax payers pump and treat into perpetuity unsustainable treat only to potable standards not fit-for-use 7

8 Acid Mine Drainage Sibanye solution Short-term treatment: lime dosing, precipitate and settling to separate solids from compliant water high-rate settling as compared to other available technology improved cost-effective, environmental footprint can be treated to potable standards if further treatment performed Long-term treatment: backfill the void with tailings residue allow flooding of the void to just below decant level treat decant on surface to drinking water standard using appropriate technology and offset cost against cost of municipal supply 8

9 Compliance Problem The law (National Water Act (NWA)) vs regulations Obtaining a fair WUL on time sometimes unachievable conditions inconsistency of standards and requirements long application and amendment times 9

10 Compliance Sibanye solution Environmental decision support system developed (MEMDSS) Implemented three sector compliance management system (care, statutory and structural) Monitoring use of in-house specialists reduce cost ability to react in real time Active consultation with the DWS Participation in decision-making processes Sibanye participates in key workshops, policy and strategy sessions influences policies to ensure they are practicable and implementable 10

11 Water quality and quantity Problem South Africa has limited water resources which are inequitably distributed Sibanye has surplus water Governmental constraints on the sale of water by private companies Minerals naturally associated with metals and salts influences water quality metals and uranium Sewage and agricultural pollution are significant issues cross contamination Mine activities contaminate the groundwater resource Contribution and current water needs by major economic sector 18% 4% 5% 2% 3% 1% 67% Irrigation Urban Rural Mining Power generation Afforestation Transfer out 11

12 Water quality and quantity Sibanye's solution Separate clean and dirty water from source: key principle of the NWA includes keeping clean water out of dirty areas, such as mine workings Treat underground water, mine water and AMD water for internal use Produce potable water through active treatment methods (e.g. water treatment plants) for external supply for closure (includes WRTRP) included as part of draft Integrated Water Quality Management Policy of the Department of Water and Sanitation Sibanye gave input recommending the private sale of water to cover cost of treatment regional opportunities for use of resources Implement passive technologies for water treatment after closure (bioremediation e.g. wetlands and attenuation) Innovative metal s and uranium removal and recovery: projects being implemented and investigated will allow for recovery of metals Working with farmers and assisting municipalities to solve water issues 12