The rapid progress of gold explorer and developer West Wits Mining’s Qala Shallows mine – South Africa’s first gold mine in 15 years – has been underpinned by a multidisciplinary due diligence study conducted by engineering and scientific consultancy SRK Consulting in the second half of 2025.

Commissioned by specialist mining financier Nebari – a key funding stakeholder in Qala Shallows – the due diligence assessed the technical, operational and execution risks associated with the project.

This provided an evidence-based view on any material issues that could compromise funding, development or long-term operability, says SRK Consulting director, partner and principal mining engineer Joseph Mainama, who led the assignment for SRK Consulting.

“The client wanted comfort that there were no risks that could pose a significant threat to the project going ahead sustainably,” he says.

Of equal significance were considerations regarding execution readiness, including the established foundational components, the realism of schedules and the viability of key milestones to support the established funding and repayment structure, he adds.

Distinctive Features, Toll Treatment

The Qala Shallows mine, part of West Wits Mining’s broader Witwatersrand Basin project, features distinctive technical aspects compared to other gold operations in the country, points out Mainama.

As a shallow, mechanised underground mine, Qala Shallows contrasts starkly with the traditional deep-level, labour-intensive operations that dominate the Witwatersrand basin region.

“From a technical risk perspective, the relatively shallow depth of the operation significantly alters the design envelope,” he explains.

Further, ventilation requirements are modest by South African gold mining standards, pumping duties are materially lower and overall infrastructure intensity is reduced. As a result, the cooling of intake ventilation is not necessary owing to the shallow depth of the operation.

However, this same shallow geometry introduces other design considerations, particularly in relation to surface interaction and subsidence management, which formed part of SRK Consulting’s technical review.

Another defining element of the project’s configuration is its use of toll treatment at an existing third-party processing plant, rather than constructing a dedicated plant and tailings storage facility.

This materially reduces upfront capital and execution complexity, says SRK Consulting design engineer Kenneth Mahuma. At the same time, he adds that it creates technical and contractual interfaces that needed to be robustly structured over the life of the operation.

“From an engineering and project delivery perspective, toll treatment by a third party changes the risk profile quite significantly,” says Mahuma, adding that while this option removes considerable construction and commissioning risk, there needs to be certainty about the materials handling, logistics and processing interfaces.

Toll treatment agreements also need to be properly defined to ensure that capacity is secured for the life of the mine.

The due diligence study was conducted as a systems-level interaction to deliver a fully integrated, multidisciplinary outcome, explains Mainama.

Full Spectrum of Disciplines

SRK Consulting covered the full technical spectrum of the Qala Shallows mine, including its geology, resource and reserve compliance, the mine’s mining method and the overall mine design, as well as taking into account geotechnical considerations, and ventilation and engineering infrastructure.

SRK Consulting also examined environmental, social and governance risks, hydrology and geohydrology, capital and operating cost estimates, metallurgy and toll treatment arrangements, as well as project execution planning and organisational capability.

This due diligence exercise was not only to identify potential risks, but to make recommendations to assist the management team to implement effective risk mitigation, says Mainama.

SRK Consulting also undertook scenario and sensitivity analyses to test the project’s robustness against deviations from base-case assumptions, as well as explored scenarios such as reduced production rates.

“Such scenarios give the client a quantitative feel for how sensitive the project is to key value drivers and whether it can still sustain the funding structure under less favourable conditions,” says Mainama.

A further critical layer of SRK Consulting’s review related to mineral resource and reserve estimation – particularly the compliance with the Australasian Joint Ore Reserves Committee Code, given West Wits Mining’s exchange listing in Australia.

Non-compliance with reporting codes is a potential funding “showstopper”, notes Mainama.

He explains that part of SRK Consulting’s mandate was to confirm that the resource and reserve statements, as well as the underlying technical work, were appropriately aligned with the relevant codes and standards.

Importantly, the due diligence process itself was structured as an interactive, iterative technical engagement rather than a purely document-based review, continues Mainama.

SRK Consulting’s specialists conducted a detailed data-room review, followed by site inspections and technical workshops involving West Wits Mining’s management and engineering team, as well as Nebari representatives.

“These allowed issues to be interrogated in real time, ensuring that technical findings were immediately understood in the context of funding risk and execution priorities,” concludes Mainama.