Skip to main content

 

PERFORMANCE

Abridged Mineral Resources and Mineral Reserves Statement
   

Introduction

The purpose of this report is to document the Mineral Resources and Mineral Reserves of Merafe Resources (Merafe) in accordance with the requirements of the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves, 2016 (SAMREC). All Merafe’s operations are part of a pooling and sharing venture with Glencore Operations South Africa Proprietary Limited (the Glencore-Merafe Chrome Venture (the Venture)). Merafe has a 20.5% attributable beneficial interest in the Mineral Resources and Mineral Reserves of the Venture. The estimates in this document are as at 31 December 2019. To arrive at a Mineral Resources and Mineral Reserves estimate for 31 December 2019, the budgeted production for July 2019 to December 2019 has been subtracted from the total estimates. The Mineral Resource and Mineral Reserve information in the tables on the following pages is based on information compiled by a Competent Person (as defined by the SAMREC Code).

Type of mining and mining activities

The Venture has chrome mining operations along the Western- and Eastern Limbs of the Bushveld Complex. The operations along the Western Limb of the Bushveld Complex comprise the Waterval- and Kroondal Mines. The LG6 Package at both Waterval and Kroondal Mine is mined underground using trackless mining methods on a Bord-and-Pillar lay-out. Kroondal will be targeting a production rate of 146ktpm. Boshoek Mine is 20km north-west of Rustenburg. The MG1, LG5 and LG6 Chromitite Layers have been mined in several open pits. The opencastable ore has almost been depleted and the mine has been put on care and maintenance. Townlands Extension 9 is an exploration project. A Retention Permit has been applied for in November 2017. The DMRE accepted the application and the Venture is now awaiting the granting and execution of the application. No exploration costs have to be expended on the project from the date of execution of the application for the subsequent 3 years. Pending the outcome of the application no 3rd party may legally apply for a Prospecting Right over this property. Thorncliffe-, Magareng- and Helena Mines are situated along the southern portion of the Eastern Limb of the Bushveld Complex. The MG1 Chromitite Layer is being mined underground using trackless mining methods on a Bord-and-Pillar mining lay-out. Thorncliffe, Magareng and Helena Mines are situated within the same Mining Right area but are situated on different farm properties. A conversion application from a Prospecting Right to a Mining Right has been submitted to the DMRE for an exploration project on the farms of St George and Richmond. This application has been granted, executed and registered in the Mining Deeds Office and St George and Richmond farms are now part of the Eastern Chrome Mines Mining Rights area. The Venture’s silica deposit lies 15km west of Rustenburg. The quartzite is mined mainly to supply the Venture’s furnaces with silica.

Comparison of Mineral Resource and Mineral Reserve estimates with previous year’s estimates

The annual Mineral Resource and Mineral Reserve estimates are compared with the previous year’s statement and reconciled each year after the estimates have been finalized. Changes in the year on year tonnage and grade estimates are mainly due to mining depletion and changes in the Mineral Resource and Mineral Reserves tonnages and grades due to additional geological information. In addition, disposed or lapsed rights will also impact total resources and reserves.

The biggest impact to the year-on-year changes in the chrome Mineral Resource tonnages for the Venture is mainly due to the exploration contributions of the St George and Richmond Mineral Resources to the tune of 38.68Mt. The most significant changes in the year on year estimation of the Mineral Reserves occurred along the eastern limb. With the conversion of the St George and Richmond Prospecting Right to a Mining Right the Thorncliffe mining footprint on Richmond contributed 2.04Mt. Helena had an increase of the 5 year mining footprint on the farm Helena, which mainly contributed to the resulting increase in the Mineral Reserves of 1.59Mt.

Material risk factors

There are no foreseen material risk factors that could affect the validity of the current Mineral Resource and Mineral Reserve statement. All the legislative requirements have been met with respect to the rights to mining and prospecting for which the Mineral Resources and Mineral Reserves have been reported. All the operating mines are mining under new order, executed, Mining Rights. The Prospecting Rights of all the prospecting areas have been converted to new order Prospecting Rights.


For the complete Mineral Resources and Mineral Reserves statement including definitions of the categorisation of mineral resources and reserves as per the SAMREC Code 2009, descriptions and exploration activities, geological settings of the reserves (including maps and diagrams), legal entitlement, methods and assumptions, material risk factors and a summary of environmental funding and management, see Appendix 1 to this report and our online Integrated Annual Report for 2019.   See Directors’ report for the statement on mining rights and mining operations.
                         
        Measured Mineral
Resources
Indicated Mineral
Resources
Measured and
Indicated Resources
Inferred Mineral
Resources
 
Name of operation Attributable
portion
Mining
method
Commodity 31.12.19 31.12.18 31.12.19 31.12.18 31.12.19 31.12.18 31.12.19 31.12.18 Competent
Person
Bushveld Complex – Western Limb                      
Western Chrome Mines – LG6 Chromitite Package and MG1 Chromitite Layer                  
Waterval 20.5% UG Ore (Mt) 16.231 16.231 1.02 1.02 17.26 17.26 0.7 0.7 MM/DR
      Cr2O3 (%) 41.31 41.31 42.6 42.6 41.4 41.4 43 43  
Marikana West 20.5% UG Ore (Mt) 2.991 2.947 1.69 1.69 4.69 4.64 MM/DR
      Cr2O3 (%) 42.43 42.44 42.6 42.6 42.5 42.5  
Kroondal 20.5% UG/OC Ore (Mt) 9.399 8.590 0.66 1.57 10.06 10.16 MM/DR
      Cr2O3 (%) 42.76 42.84 41.5 41.6 42.7 42.6  
Kroondal Gemini 20.5% UG/OC Ore (Mt) 10.369 10.037 4.22 4.96 14.59 15.00 MM/DR
      Cr2O3 (%) 42.54 42.56 41.4 41.4 42.2 42.2  
Marikana East 20.5% UG Ore (Mt) 4.279 4.193 0.53 0.79 4.81 4.98 MM/DR
      Cr2O3 (%) 42.23 42.25 42.0 41.8 42.2 42.2  
Klipfontein/Waterval 20.5% UG Ore (Mt) 11.852 9.952 22.94 16.92 34.79 26.87 101.1 106.9 MM/DR
      Cr2O3 (%) 42.08 42.1 42.0 42.0 42.0 42.0 42 42  
Boshoek 20.5% UG/OC Ore (Mt) 17.09 17.09 17.09 17.09 MM/DR
      Cr2O3 (%) 40.5 40.5 40.5 40.5  
Townlands Extension 9 20.5% UG Ore (Mt) 12.94 12.94 12.94 12.94 MM/DR
      Cr2O3 (%) 41.4 41.4 41.4 41.4  
Total – LG6 and MG1     Ore (Mt) 55.121 51.951 61.11 57.00 116.23 108.95 101.8 107.6 MM/DR
      Cr2O3 (%) 42.09 42.10 41.5 41.4 41.8 41.7 42 42  
Western Chrome Mines – Tailings                      
Kroondal Dam 20.5% Tailings (Mt) 1.5 1.6 MM
      Cr2O3 (%) 16 17  
Waterval East Dam 20.5% Tailings (Mt)   0.9 0.9 MM
      Cr2O3 (%) 19 19  
Waterval West Dam 20.5% Tailings (Mt) 0.3 0.03 MM
      Cr2O3 (%) 17 15  
Cashan Dam 20.5% Tailings (Mt) 0.03 MM
      Cr2O3 (%) 17  
Total Tailings     (Mt) 2.8 2.6  
      Cr2O3 (%) 17 17  
Bushveld Complex – Eastern Limb                      
Eastern Chrome Mines – MG1 Chromitite Layer                    
Thorncliffe mine 20.5% UG/OC Ore (Mt) 39.814 36.445 10.16 14.40 49.98 50.85 0.02 0.2 SV/DR
      Cr2O3 (%) 40.16 40.44 41.2 41.2 40.4 40.6 42 42  
Helena 20.5% UG/OC Ore (Mt) 23.763 23.667 12.77 13.58 36.54 37.25 10.2 9.1 SV/DR
      Cr2O3 (%) 39.81 39.75 38.5 38.4 39.3 39.3 38 38  
De Grooteboom 20.5% UG/OC Ore (Mt) 1.037 1.038 0.50 0.50 1.54 1.54 SV/DR
      Cr2O3 (%) 40.22 40.23 40.3 40.3 40.2 40.3  
Richmond 20.5% UG Ore (Mt) 0.578 0.595 21.83 12.26 22.41 12.86 29.2 13.9 SV/DR
      Cr2O3 (%) 40.95 41.32 41.2 41.1 41.2 41.1 41 41  
St George 20.5% UG Ore (Mt) 0.981 3.95 4.92 4.94 4.92 19.9 6.1 SV/DR
      Cr2O3 (%) 40.21 39.5 39.6 39.6 39.6 40 40  
Total – MG1     Ore (Mt) 66.172 61.743 49.23 45.67 115.40 107.41 59.2 29.3  
      Cr2O3 (%) 40.04 40.18 40.4 40.2 40.2 40.2 40 40  
Eastern Chrome Mines – MG2 Chromitite Layer                    
Thorncliffe 20.5% UG/OC Ore (Mt) 41.8 41.8 SV/DR
      Cr2O3 (%) 38 38  
Helena 20.5% UG/OC Ore (Mt) 85.4 85.4 SV/DR
      Cr2O3 (%) 38 38  
Total – MG2     Ore (Mt) 127.2 127.2  
      Cr2O3 (%) 38 38  
Total – MG1 & MG2     Ore (Mt) 66.172 61.743 49.23 45.67 115.40 107.41 186.4 156.5  
      Cr2O3 (%) 40.04 40.18 40.4 40.2 40.2 40.2 39 38  
Eastern Chrome Mines – Tailings                      
Thorncliffe Dam 20.5% Tailings (Mt) 4.4 3.9 SV
      Cr2O3 (%) 20 20  
Helena Paste 20.5% Tailings (Mt) 0.3 0.3 SV
      Cr2O3 (%)   17 17  
Total Tailings     (Mt) 4.6 4.2  
      Cr2O3 (%) 20 19  

Notes:

Tonnages are quoted as million metric dry tonnes. Grades are quoted as %Cr2O3. The measured and indicated Mineral Resources are inclusive of those Mineral Resources modified to produce Mineral Reserves. No cut-off grades are applied to the chromitite layers currently being mined because of the exceptional regional grade consistency and continuity.

The Mineral Resources are estimated as chromitite tonnages and grades to reflect the grades of the various individual chromitite layers. Both the LG6 and MG1 chromitite layers which the Venture is currently mining, are discrete solid chromitite layers.

Competent Persons:

PJG – Pieter-Jan Gräbe, Glencore Operations SA, (SACNASP – 400188/87). Lead Competent Person for Mineral Resources and Mineral Reserves. SV – Solly Vaid, Glencore Operations, Eastern Chrome Mines, (PLATO – MS 0114). Responsible for Mineral Resources and Mineral Reserves. MM – Mogomotsi Maputle, Glencore Operations SA, Western Chrome Mines, (SACNASP – 400071/14). Responsible for Mineral Resources and Mineral Reserves. DR –Dean Richards, Obsidian Consulting Services (SACNASP – 400190/08). Responsible for geostatistical analysis of data, Mineral Resource classification and construction of tonnage and grade block models and reporting of tonnage and grades from block models.

Chrome Mineral Reserve statement

          Proved Mineral
Reserves
Probable Mineral
Reserves
Total Mineral
Reserves
 
  Attributable
portion
Mining
method
Commodity   31.12.19 31.12.18 31.12.19 31.12.18 31.12.19 31.12.18 Competent
Person
Bushveld Complex – Western Limb                      
Western Chrome Mines – LG6 Chromitite Package and MG1 Chromitite Layer              
Waterval 20.5% UG Ore (Mt)   8.692 8.802 0.93 0.95 9.63 9.75 MM/DR
      Cr2O3 (%)   31.38 31.12 26.5 26.2 30.9 30.6  
Marikana West 20.5% UG Ore (Mt)   0.131 0.146 0.13 0.15 MM/DR
      Cr2O3 (%)   29.66 29.49 29.7 29.5  
Kroondal 20.5% UG/OC Ore (Mt)   2.523 1.901 0.56 1.38 3.09 3.28 MM/DR
      Cr2O3 (%)   29.05 29.59 28.1 28.6 28.9 29.2  
Kroondal Gemini 20.5% UG/OC Ore (Mt)   5.764 5.625 4.11 4.73 9.87 10.35 MM/DR
      Cr2O3 (%)   30.96 31.23 28.6 28.8 30.0 30.1  
Marikana East 20.5% UG Ore (Mt)   0.031 0.423 0.03 0.42 MM/DR
      Cr2O3 (%)   28.28 28.63 28.3 28.6  
Klipfontein/Waterval 20.5% UG Ore (Mt)   0.650 0.521 0.46 0.30 1.11 0.82 MM/DR
      Cr2O3 (%)   28.43 28.70 28.3 28.5 28.4 28.6  
Boshoek 20.5% UG/OC Ore (Mt)   0.58 0.58 0.58 0.58 MM/DR
      Cr2O3 (%)   26.1 26.1 26.1 26.1  
Total     Ore (Mt)   17.791 17.418 6.65 7.94 24.44 25.36 MM/DR
      Cr2O3 (%)   30.79 30.84 28.0 28.2 30.0 30.0  
Bushveld Complex – Eastern Limb                      
Eastern Chrome Mines – MG1 Chromitite Layer                    
Thorncliffe 20.5% UG/OC Ore (Mt)   20.406 19.719 6.64 10.03 27.05 29.74 SV/DR
      Cr2O3 (%)   33.54 33.31 34.1 34.2 33.7 33.6  
Helena 20.5% UG/OC Ore (Mt)   4.148 3.241 4.15 3.24 SV/DR
      Cr2O3 (%)   31.71 32.55 31.7 32.6  
Richmond 20.5% UG Ore (Mt)   SV/DR
      Cr2O3 (%)    
St George 20.5% UG Ore (Mt)   2.04 2.04 SV/DR
      Cr2O3 (%)   31.9 31.9  
Total – MG1     Ore (Mt)   24.554 22.961 8.68 10.03 33.23 32.99  
      Cr2O3 (%)   33.23 33.20 33.6 34.2 33.3 33.5  

Notes:

Tonnages are quoted as million metric dry tonnes. Grades are quoted as %Cr2O3. No cut-off grades are applied to the chromitite layers currently being mined due to the exceptional regional grade consistency and continuity. A minimum mining cut of 1.8m is applied to the ore reserve tonnage to accommodate the mechanised mining equipment employed by the underground mining operations. External waste is included to make up the minimum cut where applicable. The chromitite layers are mined mainly underground using trackless mechanised mining methods on a bord-and-pillar mine layout design.

Competent Persons:

PJG – Pieter-Jan Gräbe, Glencore Operations SA, (SACNASP – 400188/87). Lead Competent Person for Mineral Resources and Mineral Reserves. SV – Solly Vaid, Glencore Operations, Eastern Chrome Mines, (PLATO – MS 0114). Responsible for Mineral Resources and Mineral Reserves. MM – Mogomotsi Maputle, Glencore Operations SA, Western Chrome Mines, (SACNASP – 400071/14). Responsible for Mineral Resources and Mineral Reserves. DR –Dean Richards, Obsidian Consulting Services (SACNASP – 400190/08). Responsible for geostatistical analysis of data, Mineral Resource classification and construction of tonnage and grade block models and reporting of tonnage and grades from block models.

Statement by Competent Person

This summary has been reviewed and the relevant data extracted and compiled by Pieter-Jan Gräbe (PJG). PJG is the Lead Competent Person, registered with the South African Council for Natural Scientific Professions (SACNASP, Private Bag X450, Silverton, 0127), Reg. No. 400177/87 and holds a BSc Hons degree in Geology as well as a NHD in Metalliferous Mining. PJG is a geologist with 34 years’ experience in Mineral exploration and mining geology, directly linked to the mining industry and currently a full time employee of Glencore Operations South Africa. PJG consents to the inclusion in this report of the matters based on this information in the form and context in which it appears.

Pieter-Jan Gräbe
Glencore Operations South Africa Proprietary Limited

PO Box 2131
Rustenburg
0300
RSA

Tel: (014) 590 2415
Fax: (014) 590 2498

See Appendix 1 to this report and our online Integrated Annual Report 2019 for the complete Mineral Resources and Mineral Reserves statement.   For Merafe ownership of specific mines contributed to the Venture see directors’ report.