Name and Location
Styldrift I expansion project, North West, South Africa.

Client
Royal Bafokeng Platinum, or RBPlat, (67%) and Anglo American Platinum (33%).

Project Description
The Styldrift project area is located about 5.5 km from the existing Bafokeng Rasimone Platinum Mine (BRPM).

The project will exploit one of the last major Merensky mining blocks on the Western Bushveld.
Styldrift I will deliver an underground operation, which will be accessed through a twin vertical shaft system, with the main shaft being sunk to 758 m and the services shaft to 723 m.

The configuration of the main shaft will allow for a single-deck personnel-and-material cage compartment that can transport 185 people; a cage counterweight compartment; two Merensky reef skip compartments, each designed to accommodate a 22 t skip; and two future skip compartments, each accommodating a 13 t skip. The services shaft will comprise a personnel-and-equipment cage compartment that can transport 22 people, and a cage counterweight compartment.

Four winders will be used during the project construction phase and three during the production phase.

The height of the main shaft headgear is 58.6 m and the service shaft 41.3 m. Concentrator capacity will be 2.76-million tonnes a year.

The mine will process 230 000 t/m of Merensky reef and 20 000 t/m of waste at steady state.

Net Present Value/Internal Rate of Return
Not stated.

Value
The project is estimated at R11.01-billion.

Duration
Steady-state production is expected in the first quarter of 2020.

Latest Developments
In August 2015, the RBPlat board implemented a strategic decision to materially reduce construction activities and the related capital expenditure on the Styldrift I project. The material reduction in platinum-group metals (PGMs) prices during the first half of the year and the view that the PGM market was likely to remain depressed in the medium term influenced this decision. This resulted in:
• the suspension of all major contracts, notably the mining contract with Aveng, contracts pertaining to the overland conveyor belt construction and deferral of all major contracts relating to the supply of mining equipment, fleet and infrastructure; and
• the transfer of RBPlat’s experienced development resources from Phase III at BRPM to Styldrift I to assist in the early development of key infrastructure.

Starting the ramp-up of Styldrift I has been delayed by 12 months to better align its timing with prevailing market conditions; the start of ramp-up has currently been delayed by 12 months. This will result in steady-state production of 230 000 t/m being achieved in the first quarter of 2020.

The revised mining and construction plan is based on a self-funding strategy, with the bulk of the work being funded from surplus cash flows at BRPM and revenues generated from on-reef development at Styldrift I. The plan focuses on developing key infrastructure and establishing sufficient stoping face length to enable RBPlat to sustainably deliver 50 000 t/m to the concentrator and position Styldrift I favourably to initiate an aggressive ramp-up when market conditions permit.

RBPlat completed 1.6 km of development in 2015, delivered 65 000 t of on-reef development ore to the concentrator, completed the support and lining of Silo 2 and commissioned ventilation Shaft 1.

The company’s project scope requires 7.8 km of development to be completed by the end of 2016, with 1 km completed in 2015 and 6.8 km planned for completion in 2016. This will result in:
• four pre-established stoping sections, equating to an estimated 800 m of face length;
• four equipped workshops and 32 pre-developed workshops;
• 900 m of footwall development, including associated ore-passes on 642 level; and
• the reaming and lining of Silo 4 and the sliping of Settler 1 to establish the necessary ore-handling and pumping infrastructure on 708 level.

This will position RBPlat to start with ramp-up during 2017, market conditions permitting.

The completion of the 250 000 t/m upgrade of the BRPM concentrator,
originally scheduled for 2015, was affected by RBPlats’ cash preservation
strategy. As a result, its completion was deferred to the first quarter of 2016.

Key Contracts and Suppliers
WorleyParsons (main project engineering, procurement and construction management contractor); Anglo Technical Division (mine shaft design); Mining & Engineering Technical Services, or Mets (services shaft headgears); Shaft Sinkers (main and services shafts and associated works until January 2015, when RBPlat terminated its contract); Louwill Engineering (main and services shafts headgears and winder house structural manufacturing and erection); FLSmidth Minerals (main shaft personnel and material winder mechanical portion); Actom – formerly Alstom Industry (main shaft personnel-and-material winder –electrical portion); Coilmech (service winder – mechanical and electrical portions); Stefanutti Stocks Civils Wramatshe joint venture (civils Phase 2 contract – main bulk surface civils); Sarens (cranes); and Sandvik Mining (underground production trackless equipment).

On Budget and on Time?
The project has been deferred by 12 months. Project expenditure for the year ended December 31, 2015, was R1.66-billion, which brought the current cumulative expenditure on the project to R5.48-million.

Contact Details for Project Information
RBPlat executive: corporate affairs Mpueleng Pooe, tel +27 10 590 4515 or email mpueleng@bafokengplatinum.co.za; or investor relations manager Lindiwe Montshiwagae, tel +27 10 590 4510 or email lindiwe@bafokengplatinum.co.za.
WorleyParsons, tel +27 11 218 3000.
Mets, tel +61 8 9421 9000 or fax +61 8 9325 8311.
Louwill Engineering, tel +27 11 818 5186, fax +27 11 818 5185 or email mail@louwill.co.za.
FLSmidth Minerals, tel +45 36 18 10 00, fax +45 36 44 11 46 or email info@flsmidth.com.
Actom, tel +27 11 820 5111 or fax +27 11 820 5100.
Coilmech, tel +27 11 452 4063, fax +27 11 452 6104 or email info@coilmech.co.za.
Stefanutti Stocks, tel +27 11 571 4300, fax +27 11 571 4370 or email holdings@stefstocks.com.
Sarens, tel +27 11 861 3800,fax +27 11 861 3899 or email info@sarenssa.co.za.
Sandvik Mining EMEA business development manager Bjorn Gohre, tel +27 11 570 9676.