Pan African mining group Mwana Africa said it would restart underground mining at its Klipspringer diamond mine in South Africa and evaluate the viability of reprocessing residues at the mine after gold production from Zimbabwe stagnated.Overall profit for the year to March fell sharply from $50 million (R636m) to $7m, underlining a difficult year with low gold and nickel prices.
“The past year has proved to be particularly challenging for the Mwana Group as a whole as the prices of our two principal products, gold and nickel, weakened and have continued to fall since the financial year-end,” Mwana Africa executive chairman Yat Hoi Ning said.
This has prompted Mwana Africa to focus on its diamond project in South Africa, the Klipspringer mine.
The company said the recovery of diamonds at the Klipspringer residue treatment joint venture had reached planned capacity, although the capacity was below anticipations.
“Consideration is now being given to the reprocessing of coarser tailings,” it said.
Current projects to “recover fine diamonds from old slimes residues” had continued although the company said the resource from slimes was limited, hence the move to reprocess other residues.
Progress has also been made during the period with restarting its nickel smelter facility and kick-starting the Trojan nickel mine.
Money to restart the projects was secured through a fully subscribed $20m bond issue.
It said resumption of smelting operations would give the company ample capacity to process its own concentrates into nickel leach alloy.
The Trojan nickel mine will focus on extracting ore from higher-grade bodies. The mine had mothballed in recent years owing to low nickel prices that rendered operations unviable. Mwana Africa also runs the Freda Rebecca gold mine, where production stagnated in the past year due to equipment failures and problems in accessing high-grade ore zones.
“These problems have now been rectified and I confidently expect that our underground and surface operations will attain their full potential during the 2016 financial year,” Hoi Ning said. – Tawanda Karombo
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