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East Rand Mining Operations

Project Description

The East Rand Mining Operations (“ERMO”) cover a large area of the East Rand Basin (“ERB”) on the East Rand, Gauteng. The mining licence areas together measure approximately 36km from north to south and approximately 20km from east to west. The ERMO consists of three main areas and a processing plant, namely:

Consolidated Modderfontein Mines 1979 Ltd (“Cons Modder”), which is situated in the north of the ERB. The lease area of Cons Modder is 10,927ha in extent. Up until January 2005, when open pit operations were suspended, Cons Modder was host to all the company’s active open pit operations, and was the main exploration target area for additional open pit resources. There are three equipped underground shafts at Cons Modder, which are all actively producing.

Grootvlei Proprietary Mines Ltd (“Grootvlei”), which is situated in the eastern portion of the ERB near the town of Springs and borders on the eastern side of Cons Modder and the northern end of Nigel. The total extent of the area is 5,357ha and consists of three producing shafts and a dedicated pumping shaft that is centrally situated to keep the water level in the ERB at the minus 737mbs level by pumping 65 to 80Ml of water out of the basin per day.

Nigel Gold Mining Company (Pty) Ltd (“Nigel”) is located in the southern portion of the ERB extending over an area of 11,945ha. There is currently only one operating shaft, Marievale #2, in this section. Nigel was host to a small open pit operation in the past, which has been suspended and rehabilitated.

The processing plant, tailing facilities and main offices are located on the Grootvlei property.

Location, Access and Infrastructure

ERMO have properties in the ERB of the Witwatersrand basin located in East Rand Area of the Gauteng Province, South Africa. The operations are located approximately 40km east of Johannesburg, and can be easily accessed via numerous roads that branch off the national N12 and N17 highways (Figure 34).There is no process water source on the properties other than that which can be acquired from underground sources. Power, potable water and other related infrastructure are easily obtained given the proximity to Johannesburg and other established communities in the area.

Climate and General Topography

The climate in the area is much the same as that at WRMO, with mild to cold winters and warm summers and typical of the Highveld in South Africa. The climate does not pose any restrictions to working conditions, and work can take place all year round.

History of the Project

The East Rand was historically one of the major gold producers of the Witwatersrand Basin. Gold production commenced in 1888, when the Nigel gold mine came into operation, followed by the Van Ryn Estates in 1892. As the three ERMO have not always belonged to the same owners, and have undergone many boundary changes since mining began in the area, it is not possible to give a detailed and accurate account of the history and production of each of the properties. However, some information regarding the history of the area and the operations (as much as is known) is summarised below:

Table 29: History of the East Rand Mining Operations

Date	Activity
1888	Gold production commenced in the East Rand.
1922	Miners Strike.
1934	First shaft sunk at Grootvlei.
	Started mining the Main Reef initially – by 1970 most of Main Reef had been mined out at Grootvlei.
1940s – 1950s	Main period of production and development in East Rand.
	Uranium boom impacted positively on the East Rand as the Kimberley reef is a significant uranium host. Uranium was extracted from the Vogelstuisbult and Daggafontien Mines.
Late 1950s	Gold price was fixed and caused closure of many mines.
1978	Abolition of fixed gold price.
1981	Grootvlei – Mining of the Black Reef began.
1980s – 1990s	Grootvlei lease area extended to include East Geduld, Daggafontein and Welgedacht.
Late 1980s	Many abandoned claims were restaked and some old workings were reopened.
1990s	Flooding of the deeper Main Reef formation resulted in the major tonnage contributors shifting to the relatively shallow Kimberley and Black Reefs.
9 June 1997	Grootvlei became a wholly-owned subsidiary of Harmony Gold Mining Company Ltd (“Harmony”).
1 July 1997	Cons Modder became a wholly-owned subsidiary of Harmony.
July 1997	Pretklerk Springs Daggafontein Gold Mining company (Pty) Ltd, Pretklerk Gold Mining Company (Pty) Ltd, Pretklerk Marievale (Pty) Ltd and Nigel are merged by Petmin to form the greater Nigel Gold Mining Company.
15 December 1998	Petmin acquired Grootvlei and Cons Modder from Harmony.
October 2002	EAGC acquires 100% of ERMO (a wholly-owned subsidiary of Petmin).
14 February 2003	Bema acquires 100% of EAGC.

Latest Annual Report

31 July 2008
Annual Report 2007 [PDF - 2.6MB]

Latest News

29 July 2008
Status of fundraising, release of Annual Financial Statements and notice of Annual general meeting

27 June 2008
Further cautionary announcement

12 May 2008
First Quarter Results and the opening of Ndlovu Shaft