Target Gold Mine, South Africa

The newest deep gold mine to be developed in South Africa, Target first hit its scheduled mining rate of 17,500t a day in late 2001, and has since been ramping up to its scheduled production rate of 350,000oz a year of gold.

The mine has been under development since 1995, with the aim of accessing previously unknown gold resources that lie to the north of the existing Welkom gold field, some 200km southwest of Johannesburg. The total capital cost of bringing the mine into production has been R2.01bn ($215m).

The corporate rearrangement that has taken place between Avmin, Harmony Gold Mining Co. and African Rainbow Minerals has resulted in Target being transferred from its original owner, Avgold, to Harmony, which now has 100% ownership.

GEOLOGY AND RESOURCES

The Welkom gold field lies at the southwestern end of the major Witwatersrand basin. The Welkom section was discovered in the late 1940s, leading to the development of several mines, including Anglovaal's Loraine operation.

The Eldorado Reef mineralisation is contained in a series of ancient alluvial fans, stacked sequentially within the rocks of the Central Rand Group of the Witwatersrand Supergroup. Avgold's recognition of the periodicity of these sequences led the company to explore the area to the north of its Loraine mine, where it has discovered substantial gold resources contained in the Basal, 'B' and Elsburg Reefs, which occur throughout the Welkom area, and the previously uneconomic Big Pebble and Dreyerskuil Reefs.

Harmony announced an improved performance at the mine in the second half of 2008 as a result of an increased mining vehicle fleet and fewer problems encountered with large rocks in massive stoping areas which had decreased loading rates in the first half of the year.

In total, the operation has a resource of 25.1Mt containing 4.8Moz of gold. Exploration carried out over the past few years has identified substantial indicated and inferred resources in the Northern Free State area, north of Target itself, totalling some 325Mt containing around 74Moz that could form the basis for a separate new mine, and for which a prefeasibility study has been completed.

TARGET MINE DEVELOPMENT

The Target orebodies, which lie at depths of between 2,200m and 2,500m below surface, have been accessed by declines sunk from the existing underground infrastructure at Loraine, where production ended in mid-1999. This has substantially reduced the cost of bringing Target into production. Drilling equipment used included Sandvik (Tamrock) twin-boom jumbos.

The declines are equipped with roof-slung Walter-Becker monorails for transporting materials from the Loraine shaft to the Target production areas. The declines also handle crushed ore from the main underground primary crushers to the hoisting skips in Loraine's No.1 shaft, using belt conveyors that are also used for transporting personnel.

MINING METHODS

From the outset, Avgold planned Target to be highly mechanised, using long-hole stoping where reef widths allow this, and either cut-and-fill or long-hole stoping in narrow reef areas. Broken ore is handled using remote-controlled Sandvik load-haul-dump machines. Drift-and-fill mining is used in flat-lying reef areas.

The depth of the orebodies means that all the stoping areas must first be destressed by developing conventional narrow-reef stopes above them, and once extracted, all stopes are backfilled using cemented mill tailings.

In order to monitor the mine, Avgold installed a fully integrated information system – Prostar (Production Systems for Target) – that provides real-time information on all aspects of the operation, including geological data, mine operations, maintenance, materials management, production control and other parameters. The network is run from a centralised surface control room. The mine is also equipped with a leaky-feeder radio system for improved communications between surface and the entire underground operation.

The mine has 24MW of refrigeration capacity for underground ventilation air, helping to maintain the operations at temperatures of below 27.5°C.

Progress in the massive stope areas of the mine has been hampered by high stresses that caused large low-grade rocks to block the drawpoints. This has been handled by reducing the size of the stopes, by increasing the drawpoint spacing and by mining new destressing slots, giving increased mining flexibility.

ORE PROCESSING

While the initial development material containing ore was treated in the old Loraine concentrator, this has now been partly demolished and a new, highly automated metallurgical plant is scheduled for commissioning in late 2001.

The new concentrator process will feature semi-autogenous grinding (SAG) of the crushed ore from underground. Following thickening, centrifugal gravity concentration of the slurry from the SAG mills produces feed for continuous cyanide leaching. Carbon-in-pulp systems are used to retrieve the gold from the leach fluids, with Anglo American Research Laboratories' proprietary elution and electrowinning technology used for final gold recovery.

PRODUCTION

Since coming into Harmony’s portfolio in April 2004, Target's focus has been on reducing its production costs. In 2008 Harmony said its grade had decreased by 14.7% to 5.41g/t as a result of the ongoing depletion of massive higher grade stopes and ongoing stope sequencing. While volumes were higher at 820,000t, total gold produced was 5.2% lower at 4,430kg (142,433oz) as a result of the lower grades. At the same time, costs rose by 21.2% to R85,678 ($370/oz) in 2008.

Poor vehicle availability underground led to a shortfall in development, which in turn created a shortage of broken ore. As a result, the mill treated an average of 67,500t a month compared to its 105,000t a month capacity.

While the mine has extensive reserves, falling ore grades continue to present a problem, with the head grade reducing over 2006 from 6.36g/t in the first quarter to 5.18g/t in the fourth quarter. Harmony spent some $9.6m at Target during 2005–06, mainly on underground development and the replacement of the underground fleet. In 2008-09, the company reported a cash operating profit of R129m with capital expenditure more than doubling during the year to R256m.