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Johannesburg- and New York-listed DRDGOLD's projects under way are "advancing very well" as the gold-from-tailings company's 2028 Vision gets a massive boost from the sky-high gold price.

Mining Weekly discussed this in a Zoom interview with DRDGOLD CEO Niël Pretorius and DRDGOLD CFO Riaan Davel, which we now publish following last week's declaration of an eighteenth consecutive financial year of dividend payout by the company that on April 25 will celebrate 130 years of being listed on the Johannesburg Stock Exchange. (Also watch attached Creamer Media video.)

The shareholders of DRDGOLD are continuing to benefit from consistently impressive on-surface gold recovery at the 13-year life-of-mine (LoM) Ergo, east of Johannesburg, as well as its rapidly advancing 20-year LoM Far West Gold Recoveries (FWGR) activities west of the Golden City.

"We're working hard to optimise our existing asset base. Basically what we're doing now is Ergo Two," Pretorius added in referring to initial life of mine plan for Ergo, acquired in 2007, having been mined out," Pretorius outlined.

Ergo Two's first new vital thrust is the cost-cutting 60 MW solar power plant at the tailings reprocessing plant, plus the commissioning of a 160 MWh battery energy storage system.

The second part of Ergo Two involves the expansion of the Brakpan tailings storage facility and commissioning of the Withok tailings facility in order to restore the throughput rate back to some 1.8-million tons a month.

That's the target of Vision 2028, along with a whole new range of resources that will be accessed over the next few years.

At the same time, on the Far West Rand, taking progressive shape are the Far West Gold Recoveries activities involving repurposing and recommissioning the Driefontein Two plant's throughput to 600 000 t a month, from its consistent current 500 000 t a month.

But, from the outset, work started on the design of the regional tailing storage facility (RTSF), where more than two-million cubic metres of material have been moved from the large 800 ha site.

The second component of the RTSF project is the doubling in size of the Driefontein Two plant to take it to 1.2-million tons a month, and through Vision 28, establishing the capital infrastructure to support a throughput of three-million ton a month.

This is about one-million tons higher than currently. Thereafter gold output will be increased by roughly a ton a year, or 40 000 oz, to take DRDGOLD to more than 200 000 oz, sustaining that for many years to come.

"These are exciting projects. They're all going well," Pretorius enthused.

The gold price at record highs is providing the ability to aggressively reinvest into supporting capital infrastructure.

DRDGOLD has spent close to R1-billion on capital infrastructure in the last six months, and has not had to dip into its debt facility set up during the course of last year.

Mining Weekly: How strong is DRDGOLD's balance sheet and what are its added strength prospects in the light of the record gold price?

Davel: We're very proud of our of our balance sheet. From31 December 2023 to 31 December 2024, our property, plant and equipment, grew by R3-billion and the majority of that investment has gone into the solar and battery system at Ergo, which is now practically complete. And then, it's strong in that we still have cash in the bank of just over R600-million at the end of December. We've always invested in rehabilitation funds or assets on our balance sheet, so it's really a strong foundation for us to grow from and the gold price is really supporting our growth.

Our model is brilliant from that point of view, in that we still operating fully at both Ergo and Far West Gold Recoveries, based on its capacity, and constraints that we want t...

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Leverage to the higher gold price drove a 216% increase in earnings before interest tax depreciation and amortisation (Ebitda) to R3.6-billion for Sibanye-Stillwater in the last six months of last year, outgoing CEO Neal Froneman reported on Friday, February 21.

Group Ebitda of R6.4-billion for the second half (H2) of 2024 was in line with the R6.4-billion Ebitda for H2 2023.

Froneman, who in September hands over to incoming CEO and current chief regional officer South Africa Richard Stewart, reported during the presentation of second-half (H2)results covered by Mining Weekly that Ebitda from South African gold operations increased by R2.5-billion, accounting for 56% of group adjusted Ebitda for the period. (Also watch attached Creamer Media video.)

This was the first six-month period since 2017 that adjusted Ebitda from the Johannesburg- and New York-listed company's South African gold operations exceeded the contribution from its South Africa platinum group metals (SA PGM) operations.

This marks a notable turnaround from previous years when the SA PGM and US PGM operations comprised 80% to 90% of group earnings.

The significant increase in the profit from the SA gold operations and restructuring of the group operations have, on balance, stabilised group profitability.

CHROME VALUE OPPORTUNITY

The improved economics of Sibanye-Stillwater's chrome production are expected to assist with the development and extension projects at the SA PGM operations, which are currently being assessed.

This follows the signing on February 19 of a strategic enhancement to the historical Marikana chrome contract and a new chrome management agreement with the Glencore Merafe Venture.

Most of the chrome recovery plants at Sibanye-Stillwater's SA PGM operations is now poised to be operated by the Glencore Merafe Venture, which intends to leverage its processing expertise to optimise chrome production yields and reduce operational costs across all relevant chrome recovery plants.

The enhanced Marikana contract is expected to accelerate completion of delivery of contracted chrome volumes agreed between Lonmin and the venture in 2011, by about 20 years, through increasing feed and improving recoveries from the Marikana chrome recovery plants.

Upon expiry of the Marikana contract, the Marikana chrome recovery plants will become subject to the terms of the chrome management agreement, increasing Sibanye-Stillwater's share of free cash flow from chrome production from the Marikana chrome recovery plants.

Together, these agreements are expected to allow greater exposure to chrome prices and incentivise future chrome production growth, realising value for Sibanye-Stillwater and enhancing value creation opportunities for the Marikana operation.

URANIUM STRATEGY

On 9 December 2024, Sibanye-Stillwater agreed to sell its Beatrix 4 shaft, Beatrix operations in South Africa's Free State, which includes the Beisa uranium project, to Neo Energy Metals, a uranium exploration and development company listed on the main board of the London Stock Exchange and dual-listed in South Africa on the A2X market.

This transaction has advanced the group uranium strategy by presenting Neo Energy with an opportunity to develop the Beisa uranium project to be developed by Neo Energy, while allowing Sibanye-Stillwater to maintain exposure to future uranium production without sole reliance on group capital funding. Various alternatives to release value from surface uranium resources at the Cooke mine in Gauteng province are also being considered.

RHYOLITE RIDGE

In 2021, Sibanye-Stillwater agreed with emerging lithium-boron producer ioneer to establish a joint venture company with respect to Rhyolite Ridge. Last year, an updated project and technical information re...

Mining Weekly Editor Martin Creamer unpacks DRDGold dividends no longer being just a policy but a value; Anglo American Platinum becoming an independent fit-for-purpose PGM company; and the new ultra-low iridium collaboration that is promising major green hydrogen magnification.

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Johannesburg- and New York-listed Gold Fields on Thursday, February 20, delivered an attributable profit of $1 245-million for the year to the end of December, which was well up on the $703-million in 2023.

Improved second-half safety and operational performance allowed for a 67%-higher R7-a-share dividend, taking the 2024 total to R10 a share, a dividend yield of 3.58%

Free cash flow was a 65%-higher $605-million on 10%-lower production of 2.07-million ounces of gold and 26%-higher all-in sustaining costs (AISC).

"We expect to create additional value in 2025," Gold Fields CEO Mike Fraser stated in a release to Mining Weekly.

Set to provide the value upturn are Salares Norte in Chile, South America, which is ramping up, and the Windfall project in Québec, Canada, which is progressing towards a final investment decision.

Salares Norte's production is expected to come with materially lower AISC than the group average and drive an increase in profitability and free cash flow per share.

From 2028, Windfall will likely improve portfolio quality and cost curve positioning.

"Concurrently, as part of our asset optimisation programme, we're undertaking extensive work to optimise efficiencies and improve costs at our operations," Fraser reported.

The 10%-lower production was mainly due to lower first-half production, particularly at Gruyere, in Australia, South Deep, in South Africa, Cerro Corona in Peru, and Salares Norte.

In particular, South Deep, which is located 50 km south-west of Johannesburg near Westonaria had a much stronger second half as the team addressed the backfill leakage and rehandling issues experienced in the first half and advanced into higher-grade areas.

Currently, South Deep's life-of-mine is in excess of 80 years, making it a critical Gold fields asset for decades to come.

In the December quarter, 10% more gold was produced at South Deep - 78 800 oz compared with 71.700 oz in the September quarter. Reef grade mined fell by 8% to 5.83g/t.

Tragically, at South Deep, an employee was fatally injured in an underground mobile equipment incident on January 2, and in Australia, a contract employee was fatally injured at St Ives site, and a subcontractor transporting equipment from Agnew mine died in a collision

with another truck at an intersection.

RENEWABLES AT SOUTH DEEP

Renewables, which accounted for 18% of group electricity consumption during 2024, provided 17% of electricity consumption at South Deep, where wind, solar and energy storage trials continue amid the functioning of the Khanyisa solar plant, which is able to generate 50 MW or 103 GWh/year and save around R123-million, or 24%, of electricity costs a year.

South Deep's consumption of about 494 GWh of electricity a year represents 10% of the mine's annual costs and 93% of its carbon emissions, with Khanyisa - which means Light Up in Setswana - reducing the mine's carbon footprint by 110 000 t of carbon dioxide a year.

Against that background, these questions were put to Fraser, Gold Fields EVP external affairs Jongisa Magagula, Gold Fields CFO Alex Dall, Gold Fields VP corporate affairs Sven Lunsche, and Gold Fields investor relations head Thomas Mengel.

Mining Weekly: When are the wind, solar and battery storage trials likely to reach a decision-making level at South Deep?

Fraser: Firstly, we do believe that South Deep has got the most potential within our entire portfolio for really advancing renewable energy as part of its energy mix, given the life, given the cost of supply from Eskom, we definitely see a significant opportunity of reducing costs and improving reliability into South Deep, and obviously the original Khanyisa solar plant has been a significant benefit to that that business.

We have done both a detailed wind study as ...

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South Africa's chromite recovery potential has been broadened by Wednesday's joint venture agreement between Glencore Operations South Africa and Sibanye-Stillwater.

"We'll definitely extend our contract terms," Glencore Alloys CEO Japie Fullard noted in response to Mining Weekly questions during a media conference that followed the presentation by Glencore plc of operationally strong 2024 results.

The chrome pooling and sharing venture with Glencore has entered into what was described in a Merafe Resources Johannesburg Stock Exchange announcement as a "mutually beneficial enhancement to the legacy agreement, as well as a new chrome management agreement with Sibanye-Stillwater.

Glencore is listed in London and Johannesburg and Sibanye-Stillwater is listed in Johannesburg and New York, while Merafe's revenue and operating income are primarily generated from the Glencore Merafe Chrome Venture, which has a total installed capacity of 2.3-million tonnes of ferrochrome a year.

Earlier this month, Merafe advised that, through its chrome venture with Glencore, a ferrochrome smelting business review might result in the suspension of certain of its ferrochrome furnaces in May, and that work with regulatory authorities was under way to explore all viable alternatives in partnership with organised labour. Additionally, engagement with suppliers was under way to identify cost-saving measures to help improve the current situation.

The negotiated price agreement (NPA) obtained from State electricity utility Eskom last year is reportedly insufficient.

"For us to survive in terms of ferrochrome capacity in South Africa, we need, first of all, to have a better NPA tariff. And then from a governmental position, they have already approved the ore tax and if we do not have some sort of initiatives from government, it will make things extremely difficult for us to survive.

"So what do we need? We also need to be excluded, as the ferrochrome industry, from cross-border adjustment mechanism CBAM tariffs otherwise we're going to be penalised even more, and what's going to put another burden on top of ferrochrome would be the carbon tax. Those would be the areas of relief that we would seek." Fullard explained. CBAM is the cross-border adjustment mechanism.

"We need to be excluded, otherwise we're going to be penalised even more. And also, what's going to put another burden on top of ferrochrome would be the carbon tax. Those would be the areas of relief that we would seek for

South Africa, once the mainstay of global ferrochrome production, today supplies most of the chrome for China to produce ferrochrome, which is used to make stainless steel.

Mining Weekly: Are you aware of the new technology that is available that can cut electricity required for smelting by two-thirds?

Fullard: I can tell you that we are already in negotiations with the owner of this intellectual property (IP). We must all understand, though, that it's still currently at pilot project stage and is not yet commercialised, so we, as Glencore, are looking into partnership with the company that's got this IP and we're aggressively looking at this as part of the solution. I can tell you, however, it's not a short-term solution, and will take time.

SMELTDIRECT

Fullard's IP comment is almost certainly a reference to the promising new Proudly South African technology called SmeltDirect, which is positioned to take the greenness and cleanness of ferrochrome to a new level at a time when the likes of the CBAM imposition are not far off in a region where combatting climate change remains an essential requirement.

SmeltDirect promises to be on the receiving end of value from CBAM carbon credits, giving South Africa an open window of opportunity to regain lost ground with...

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Johannesburg- and New York-listed DRDGOLD on Tuesday, February 18, reported soaring half-year operating profit and 28%-higher revenue for the six months to December 31.

The strongly performing surface gold mining company, headed by CEO Niël Pretorius, declared a dividend for the eighteenth consecutive financial year.

"Dividends for us are no longer just a policy but a value," Pretorius stated during the half-year presentation covered by Mining Weekly. (Also watch attached Creamer Media video.)

"To take advantage of a very healthy gold price, you need to be able to produce - and our operations managed to do just that," Pretorius pointed out.

"Focusing on paying a dividend requires financial discipline, which extends to the way that we manage our costs," Pretorius added.

The well-led regeneration, climate-conscious, property-renewing and community-uplifting DRDGOLD is maintaining steady state as it moves into the new Vision 2028 organic expansion phase.

The gold price was a 26%-higher R1 478 663/kg amid operating profit leaping 74% to R1 578.7-million and headline earnings darting 65% to just under R1-billion.

Although it was overcast and rainy during the presentation of results, DRDGOLD CFO Riaan Davel made the point that the half-year financials reflected a "very sunny" performance and "really good trends", which included the operating profit of Ergo being a whopping 92% higher at R828.7-million.

The interim dividend declared was 50% higher than last year's corresponding half-year payout.

Not having to make use of the credit facility resulted in the company's cash being a well-grounded R600-million plus, clearing the way for the board to declare a dividend one and half times the previous interim payout at 30c a share.

Half-year cash operating costs were a 6%-higher R866 221/kg, which is consistent with the rate of inflation.

Capital expenditure was a 12%-lower R947.6-million owing mainly to the completion of key projects and reduced commissioning activities on reclamation sites. Moreover, recourse to bank debt was absent from these capital re-investments.

An important achievement for the period was the integration of the solar plant and battery energy storage system into the national grid, which is providing ongoing direct cost reductions and shielding the Ergo gold-from-waste recovery operation on the East Rand and soon also Far West Rand Gold Recoveries on the West Rand from higher electricity costs and any supply interruptions.

As and when accounts have been transferred into the name of Far West Gold Recoveries, there will be the benefit of electricity wheeling as well.

Sixteen per cent less Eskom electricity was used in the half-year, even though more electricity was needed to accommodate the higher tonnage. That is the result of the commissioning of the Ergo solar plant, which is now up and running.

DRDGOLD COO Jaco Schoeman outlined how the power transition initially started off with a small solar plant of only 20 MW, which grew to 60 MW, with the battery story being similar as it worked its way to a capacity of 187 MW.

"For us to shut down the plant in a controlled manner, we need at least two hours of battery capacity," Schoeman explained.

Ergo has now changed to higher volume sites and slightly lower head grades, bringing down the rand per ton profile.

Vegetation of tailing dams is ongoing and the slight increase in potable water consumption is not a bucking of the downward use of fresh water over the years.

Construction of the regional tailings storage facility at Far West Rand Gold Recoveries has progressed to a point where more than two-million cubic metres of starter wall ground has been moved and the basin and return water dams levelled. Civil work on the Driefontein 2 plant will continue to b...

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The acronyms are becoming more intense, with PTE, which stands for porous transport electrodes, the latest one, amid the already tried and trusted proton exchange membrane (PEM) popping up for decades now in the context of platinum group metals (PGMs), which South Africa hosts in the greatest volumes.

PEM and now PTE are a reflection of PGM and green hydrogen good fortune, with PTE following an earlier ruthenium breakthrough to ensure supply at an acceptable price of iridium, which, in turn, assures the generation of affordable green hydrogen. Further good news for South Africa arises when fuel cells, which also require PGMs, turn the green hydrogen in net-zero green electricity to power trucks, trains, buses, ships, planes, buildings, factories, mines and mini-grid-served communities.

Crucially, PGM-catalysed electrolysers and fuel cells are all there is to ensure a low-carbon to no-carbon world and credible protection for a planet hit by climate change.

PTE has arrived to magnify the efficiency of PEM water electrolysis using the lowest amounts of iridium, which Heraeus Precious Metals has been going all out to do on its own and will now do to a far greater extent with the help of Smoltek Hydrogen.

Smoltek has entered into a strategic collaboration with Heraeus to elevate the functional efficiency of PTEs in PEM electrolysers to new heights.

"We've won another great ally in our quest to develop highly efficient catalyst solutions for PEM water electrolysis," Heraeus Precious Metals business line hydrogen systems executive VP Philipp Walter enthused in a LinkedIn comment.

Smoltek is combining its nanostructure technology with Heraeus' advanced catalyst formulations in a bid to significantly lower cost by further advancing the limits of iridium efficiency.

"We have very exciting times ahead. We're thrilled to join forces and push PEM efficiency to new levels," Smoltek Hydrogen president Ellinor Ehrnberg said in response about this latest step to support the global energy transition with scalable and sustainable solutions.

The new-generation PTE's electrolyser electrodes are required to carry water, hydrogen and oxygen from and to the PEM, while simultaneously serving as electrode and catalytic carrier, Heraeus has informed Mining Weekly in a media release.

For this purpose, PTEs are coated with ultra-thin iridium- and platinum-containing catalytic layers.

The key target is to decrease the necessary amount of PGMs, especially the very scarce iridium and to accelerate green hydrogen production at significantly lower cost and resource usage.

Key factors for an ultra-low iridium solution are a high addressable surface, smallest particle sizes and the formulation of the particles itself, and this is where the skillsets of the partners combine to a unique constellation:

The collaboration combines Smoltek's ultra-low iridium nanostructure technology for the PTE with Heraeus' expertise in advanced catalyst formulations.

Smoltek has already achieved 0.1 mg/cm iridium loading in PEM electrolysers, and this partnership is expected to further reduce the iridium content, by applying Heraeus' ruthenium-iridium catalyst on Smoltek Hydrogen's nanostructured PTE.

"Together, we aim to achieve a significant leap in catalyst efficiency and provide solutions that meet the needs of a growing hydrogen market," said Walter.

NEW PGM-CATALYSED ADVANCES

Many green hydrogen and fuel cell advances continue to be made.

For example, Toyota's new third-generation hydrogen fuel cell system, which reportedly offers improved performance, fuel efficiency, and cost reduction, is expected to be introduced in Japan, Europe, North America, and China after 2026.

In Germany, Accelera by Cummins will supply a 100 MW PEM electrolyser system for bp's ...

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One of the major subjects the London Bullion Market Association (LBMA) was at the Investing in African Mining Indaba to talk to governments about is how to move what is an informal gold mining landscape to a formal one.

"What you otherwise find is that the informal becomes illegal, which becomes criminal and can lead to the tragedy, such as at Stillfontein," LBMA CEO Ruth Crowell remarked to Mining Weekly in an interview.

Much better, in her view, is to have the conversation around how informal miners can be formally embedded in the economy and brought out of poverty.

"One of the things I was most excited about this week is coming from the World Bank and their work in Côte d'Ivoire doing exactly that.

"We've seen models in Peru where you're taking informal artisanal ASM miners and giving them formality and licence to operate on some parts of concessions and it seems that model is being replicated in Côte d'Ivoire and we'd like to encourage it and hope it can happen in other major producing countries like Ghana and Senegal," Crowell said.

"When the informal becomes illegal the Mr Bigs can take advantage. If you can give other options to people, they're going to make that good business. That's going to be the choice.

"I think the challenges around the world is that the gold business has been good business. But we need to work both from a law-enforcement perspective and also a market dynamic perspective to make that business good business and to incentive miners to become formalised to see the benefits."

In January, LBMA launched a digital database for gold bars to improve transparency in the precious metals market, expecting all LBMA-accredited refineries to come onboard in 2025.

The LBMA's "good delivery" list currently includes 66 gold refiners and 82 silver refiners around the globe, which must source gold responsibly under the accreditation requirements that give them access to the London hub, the world's largest for over-the-counter gold trading.

While also at the Mining Indaba, LBMA chief technical officer Neil Harby pointed out to Mining Weekly that up to 20% of the world gold supply is from artisanal (ASM) sources that is not coming through the LBMA good delivery rule structure.

What can be termed scrap or recycled gold is often ASM gold transported and converted in another country and coming back as legitimate recycled gold.

Much supply chain work has thus been done on the true definition, recycled, scrap or preconsumer and post-consumer gold.

"There's been a lot of collaborative work on that throughout the industry to make sure that the gold coming into the supply chain is correctly identified for what it is, where it has come from, and it is not trying to pass itself off as something else," Harby explained

LBMA is an international trade association, representing the London market for gold and silver Bullion with a global client base. This includes the majority of the gold-holding central banks, private sector investors, mining companies, producers, refiners and fabricators.

LBMA has 174 member companies across 23 countries: financial institutions and mining, refining, transportation, trading, vaulting and manufacturing companies. Joining the LBMA provides a seat at the table of an internationally respected body and offers wide-ranging benefits.

Mining Weekly Editor Martin Creamer discusses Barrick’s MoU with Zambia to boost mining and exploration; Brics's role in beneficiation on the African continent; and the big aluminium producer in KwaZulu-Natal that is planning to go ‘green’ to attract higher prices globally.

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While 'high-carbon' is the value-lowering label being put on aluminium from South Africa's Hillside Aluminium in KwaZulu-Natal, the Sydney-, Johannesburg- and London-listed South32 benefits from the value-enhancing 'low-carbon' premium status of its other two aluminium producers, namely Brazil Aluminium and Mozal Aluminium.

The carbon-intensive description given to Hillside stems from its use of coal-fired electricity, but the good news is that competitive decarbonisation is continuing to be intensively investigated for Hillside, the largest aluminium smelter in the southern hemisphere and the producer of a good percentage of primary aluminium for South Africa's value-adding secondary aluminium product producers.

As Hillside directly and indirectly supports more than 31 000 jobs and contributes nearly R10-billion to South Africa's GDP, it would be a major advantage if optimum public-private attention could be given to 'greening' Hillside, which is responsible for a whopping 94% of South32's total Scope 2 emissions, South32 CEO Graham Kerr spelt out in response to Mining Weekly questions followed the company's strong start to financial year 2025 (FY25), amid portfolio transformation to support the world's clean energy transition.

"Engagement with government has been good," Kerr revealed.

South32's approach to climate change embraces operational and value chain decarbonisation.

"We've been studying this technically and commercially for many years to see what's possible for the business," South32 COO Noel Pillay emphasised.

"More recently that culminated in a request for information from the market, so we went to market to test what's possible, because our technical studies concluded that we could make Hillside work with solar PV and wind, obviously with backup investment.

"That process was actually over-subscribed, so lots of interest, and in isolation that was competitive. We are talking with Eskom, so there's various options we're looking at," he said.

These include both nuclear and renewables, as well as investigating new renewables projects together with Eskom to establish the semblance of a one-stop shop.

"That's all work in progress with much more work to do to give us clarity on how we go forward," Pillay pointed out.

Just energy transition considerations for Hillside require the switch to low-carbon energy to be planned in collaboration with a broad range of government and community stakeholders.

Meanwhile, investment has been made in the low-energy consumption AP3XLE technology.

"We're trying to pull every lever that we can within what we can control and we're halfway through converting all of our potcells to AP3XLE. But what we can control is very limited. The real issue here is the power source, which is what we're working to find," Pillay added.

FY25 production guidance for Hillside is 720 000 t, which on its own is more than double the combination of the 130 000 t expected from Brazil Aluminium and the 350 000 t from Mozal.

In the half-year, overall aluminium production increased by 5% and copper production by 16%, which enabled the group to capitalise on improved commodity prices, with underlying earnings increasing by 44% to $1-billion.

An interim ordinary dividend of $154-million was declared, with $171-million remaining to be returned to shareholders.

"We are focused on continuing our strong operating performance into the second half, unlocking value from our growth pipeline and continuing to reward shareholders as our financial performance improves," Kerr stated.

"Our second climate change action plan, to be released in August, will detail our approach and the actions we are taking to address the risks and opportunities that climate change presents for our business."

Meanwhile, in the six mo...