Environment report

Pamodzi Gold is committed to ensure that the environment is considered in all aspects of the planning and operation of our mining activities. Sufficient resources are therefore dedicated to environmental protection to meet our environmental and mining objectives, while ensuring that future generations meet their own needs.

Licensing and permitting

Pamodzi Gold operates all of its mining activities under approved Environmental Management Programme Reports, licences and permits. At our East Rand operations, we are awaiting the imminent renewal of our mine water discharge licence, which is with DWAF for approval.

Public participation and NGO consultation

We aim to create an environmentally aware culture within our organisation, where responsibility is assigned and understood. Pamodzi Gold therefore reports to and communicates with our employees, government, industry, communities and other key stakeholders as part of our mining operations. It is our intention to develop, through consultation with communities, relevant authorities, NGOs and other key stakeholders, an effective public relation strategy that paves the way for two-way communication. In this way, we attempt to effectively capture concerns raised and address these to the best of our ability. A complaints register is used to effectively record and track this process. As part ofour commitment, we participate in a number of public forums like the Ekurhuleni Mining Forum, the Springs Air Quality Forum and the Blesbokspruit Forum and support local NGOs like the Grootvaly Blesbokspruit Conservation Trust.

Environmental monitoring

We are committed to continuous environmental improvement at our mining operations. We therefore apply sound environmental management practices based on the commitments in our Environmental Management Plans, licences and permits. Improvement is measured through environmental monitoring and making changes to processes to lessen the potentially negative effects that mining can cause, based on monitoring results. We have an extensive monitoring programme, as shown in the Table below, which is aimed at complying with our environmental licences, permits and management programmes. It is shown that Pamodzi Gold is maintaining a high level of compliance with licence and Environmental Management Programme compliance criteria. We however continually strive to reduce the impact of mining on the environment and specifically focused on water management during 2006. Two projects were undertaken to reduce the impact of mining on surface and underground water at our East Rand operations during 2006, namely the implementation of an additional mine water treatment plant (the BioSURE plant) and a river diversion.

TABLE Pamodzi Gold 2006 Monitoring Programme and Compliance Levels

* EC Electrical Conductivity is a measurement of the total amount of salts dissolved in water and is therefore a good environmental indicator. It is also used in soil monitoring as a measure of the amount of salts present

† Pamodzi Gold maintains a high level of compliance with the conditions of its Grootvlei mine discharge licence. However, the level of compliance with the in-stream water quality objectives for the Blesbokspruit is low. In order to reduce this impact, additional minewater treatment was implemented during 2006 at the BioSURE plant, as discussed below

BioSURE water treatment plant

The BioSURE water treatment plant receives 10 megalitres of mine water per day for purification through biological sulphate reduction. This minewater treatment project effectively reduces sulphates from 1 500 mg/l to less than 250 mg/l, before discharge to the Blesbokspruit. The process was developed in South Africa and makes use of two waste products, namely primary sewage sludge and mine effluent, to produce water of an acceptable quality.

West Pit River Diversion Project

In an attempt to reduce the volume of minewater that must be pumped and treated at our East Rand operations, a river diversion was constructed in the Blesbokspruit during 2006 to prevent surface water from entering the underground workings. Underground flow measurements indicate that a reduction of between 3 and 5 megalitres per day was achieved. This project was nominated and short-listed for a Nedbank Corporate Green Mining Award in 2006.