Pan African to acquire Blyvoor Gold surface tailings resources

Pan African has entered into a conditional agreement to acquire the entire issued share capital of Blyvoor Gold Operations from Blyvoor Gold.

Highlights of the Transaction include:

• Six historical Tailings Storage Facilities (TSFs) with total Mineral Resources of more than 1.4 million ounces of contained gold;
• A technical study to Pre-feasibility (PFS) level indicates potential to produce 25-30k ounces of gold by processing 6 million tonnes (Mt) of tailings per annum over a mine life of 15 years (extendable to 25 years with inclusion of Inferred Mineral Resources);
• Pan African has a demonstrable track record of developing and operating similar high-margin tailings processing operations at its Barberton Tailings Retreatment Plant (BTRP), Evander Tailings Retreatment Plant (ETRP) and Elikhulu operations; and
• Staged acquisition process.

The Staged acquisition process include three-month initial fatal-flaw due diligence period, following which Pan African can elect to proceed with a Definitive Feasibility Study (DFS) over the following nine months, to December 2022.

Pan African may then, following completion of the due diligence and, if applicable, the DFS, at its sole discretion, elect to acquire Blyvoor Operations for a cash consideration of ZAR110m (US$6.9m at current exchange rates), to be funded from internal cash resources.

Blyvoor Operations owns a total of six historical TSFs comprising the following:

• Blyvooruitzicht TSF No. 1; Blyvooruitzicht TSF No. 6; Blyvooruitzicht TSF No. 7; and
• Doornfontein TSF No. 1; Doornfontein TSF No. 2; Doornfontein TSF No. 3.

During 2020, independent consultants Minxcon (Pty) Ltd (Minxcon) completed a technical study to PFS level for the Blyvoor TSFs and quantified the Mineral Resources at circa 142.9Mt with an in-situ grade of 0.31g/t gold, for an estimated gold content of more than 1.4Moz gold,

Following diagnostic leach results, Minxcon reported expected CIL gold recoveries of circa 54%. The technical study to PFS level demonstrated projected average gold production of 25-30koz/yr over a life of mine of 15 years (extendable to 25 years with inclusion of Inferred Mineral Resources), processing approximately 6Mt of tailings per annum during steady state production. As part of the work to be undertaken by Pan African, the Group will assess the potential for increasing the rate of processing and resultant annual gold production.

The proposed mining method for reclamation activities will be hydro-mining, as currently utilised at the Group’s Elikhulu and BTRP operations.