The provision of more renewable energy at the South Deep gold mine 50 km south-west of Johannesburg is under intense scrutiny by Gold Fields, which describes the mine's two-year-old 50 MW solar plant as a major plus.

"One of the biggest economic advantages for us in our portfolio is further renewable energy at South Deep and so we've been studying that very heavily," Gold Fields CEO Mike Fraser said in response to Mining Weekly during a media roundtable.

Globally, Gold Fields has been deploying renewable energy across all its mine sites, with one of the big priorities being the establishment of a microgrid at the long-life St Ives gold mine in Western Australia, where its Granny Smith mine is expanding its solar farm and where the Gruyere joint venture (JV) and Agnew are renewables users. Moreover, in Peru, the group's Cerro Corona is 100% hydro-powered

Meanwhile, South Deep's 50 MW Khanyisa - meaning Light Up in Setswana - has been "a great contributor", Fraser said of the solar plant, which provides around 23% of the energy needs of South Deep, a long-life mechanised operation.

Now, the prospect of more solar energy capacity is a frontrunner, while the generation of wind energy is at an advanced stage of investigation.

"The extension of solar may be even more beneficial in the near term than wind. We'll continue to do those trade-offs. But the one thing we do know is that more renewable energy at South Deep is definitely on the cards, and we'll deliver on that," Fraser outlined.

South Deep currently consumes around 494 GWh of electricity a year, which represents 10% of the mine's annual costs and 93% of its carbon emissions.

GOLD PRICE

In response to Mining Weekly's question on the likelihood of the gold price having rebased at a higher level, Fraser described the gold industry as being "in a really great place right now".

"We don't plan for those higher prices, we plan conservatively, but as long as the gold prices hold, clearly, that's really good for the gold mines."

On what is driving the gold price, he said: "Firstly, there's a lot of central bank buying, particularly out of Asia. I think part of that is the long-term geopolitical unwinding and tension, particularly between the superpowers, and a moving away from the reliance on the US dollar as the global functional currency.

"Secondly, if you think one of the other major contributors to demand is also jewellery buying, particularly out of India.

"What we've seen driving India demand is there's been a reduction in duties payable, which is providing some support, but also what you've got is massive latent demand as increasing wealth emerges in India, and you should see continued strong demand on that."

A third driver is demand for micro exchange-traded funds in China and a fourth element is the foreseen lowering of interest rates, which puts the cost of holding gold in more attractive light.

"So, there are a lot of positive attributes that we should see supporting gold and certainly a lot of people are saying that the risk is more to the upside than the downside.

"Seeing a major reset to, say, below $2 000 oz is probably less likely than additional upside, which we think, over the coming years, will certainly be good for gold producers.

"If you look at Gold Fields profile going forward, I think we're well placed to take advantage," Fraser added, amid the company planning second-half gold production for around 1.2 million ounces, up on the first-half's 918 000 oz.

Meanwhile, because of the slower end-September restart at Salares Norte in Chile, and the slower recovery at South Deep, output has been guided down by 150 000 oz.

Encouragingly, South Deep's redesigned mining methodologies are setting the mine up for success, amid backfill leakage slowing stope turnaround and stope development.

"We've opted for taking a conservative approach in getting this right. There are products that have been tested that will help us solve the leakage challenge, and once through that, ...