Can you elaborate on Pan African Resources’ growth pipeline and the recently discovered ore body at New Consort gold mine?
Over the last two years, we increased our underground exploration efforts at the New Consort gold mine, where we discovered one particularly rich zone within the existing gold-bearing orebody, containing mineral reserves of 5,000 tonnes, at an average grade of 25 g/t gold, demonstrating the high potential that still exists at an old asset such as Barberton mines when systematic and new exploration techniques are implemented.
We also have a very attractive external growth pipeline. We are in the process of completing a pre-feasibility study on the last remaining Witwatersrand gold tailings retreatment resources in South Africa, being the Mintails assets. We expect to complete the pre-feasibility study by July 2021, with a final feasibility study to be concluded by the first quarter of 2022. This project has the potential to give us another 50,000 ounces of high margin gold production per annum for a minimum of 10 years.
Can you elaborate on Pan African Resources’ overall balance sheet structure and how the company manages to minimize costs?
We are fortunate to have the flexibility provided by our surface operations, with much lower costs and therefore higher profit margins than underground mining. We had also taken on some debt onto our balance sheet to fund the construction of the “Elikhulu” project, but we have seen significant ROI from cash flows due to the stronger gold price in the past and paid down debt significantly, while also paying dividends to our shareholders.