DRDGold satisfied with Zim exploration progress

HARARE - South African gold producer DRDGold has expressed satisfaction with its ongoing exploration drilling programme in the country.

The Johannesburg Securities Exchange-listed miner with a secondary listing in the Nasdaq Capital Market operates 50 percent joint venture with Chizim Investments in an early-stage gold exploration project on Zimbabwe’s greenstone belt.

DRDGold chief executive Niël Pretorius said exploration activities during the last quarter remain focused on the John Bull, Leny and Ascot targets at Norton.

South Africa’s fourth largest gold producer has 25 000 hacters of exploration tenement in Zimbabwe and has spent a moderate $3 million on drilling an exploration target near Gweru and analysing and compiling geochemical reports on the Leny, Ascot and John Bull prospects near Norton.

“At Leny, diamond drilling has been completed. An intersection of 7,7 grammes per tonne over 60cm will be followed up. A geochemical survey has shown interesting results and will need to be followed up with a further survey over a smaller grid and, possibly, drilling. At Ascot, geophysical and geochemical surveys are being undertaken,” he said.

Pretorius said at John Bull, trenching revealed a high of 24,5 grammes per tonne with strike lengths of more than 600 metres.

“Three of six drill holes were completed, the third of which intersected two promising areas, 50cm and five metres thick respectively. At KT, drilling results point to narrow quartz vein mineralisation and need for follow-up. At Guinea Fowl River, a pilot recovery programme has begun."

“We’re not spending big capital on infrastructure, but we are increasingly moving towards a scenario of bulk sampling and also extracting some gold to help offset the costs of looking into this resource,” Pretorius said.

He however, said DRDGold was not, at this stage, being asked to pay ground rentals adding the potential exposure to higher lease prices was being looked into.

The miners’ concerns come on the back ground rentals increases by the Mines ministry.

In the full year to June DRDGold more than trebled its full-year earnings, as it benefited from an overhaul of its business focusing it on gold reclamation.

Headline earnings for the year to end-June came in at 61 cents a share, despite a six percent decline in production to 135 708 ounces.

DRDGold’s production is focused on surface operations and the extraction of gold contained in mine dumps surrounding Johannesburg.

Pretorius, who describes his company as a gold plant more than a gold mine, is targeting production of between 140 000 and 150 000 ounces a year.

He said DRDGold could expand into other areas of reclamation and recovery.

“To the extent that we can do this, without violating the objects of sustainable development or our strategic commitment to low risk and high margins, it may well offer an exciting new strategic course,” the mining executive said.

The company declared a final dividend of 10 cents a share.

Shares of DRDGold have gained more than 50 percent in the past year compared with a 6,8 percent decline in the JSE’s Gold Index.

Comments (1)

Compliments of the season, just been reading through your article and would like to check if you have any possibilities of exploration drilling in Zimbabwe this year

Thomas Nyamadzawo - 3 January 2017

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